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: 811-07704

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, 2014

Item 1: Report(s) to Shareholders.

Semiannual report dated April 30, 2014, 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, 2014

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®	35
Schwab International Index Fund®	43
Financial Notes	52
Trustees and Officers	62
Glossary	65
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 Schwab. 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 6 Months Ended April 30, 2014
Schwab® S&P 500 Index Fund (Ticker Symbol: SWPPX)	8.29%
S&P 500® Index	8.36%
Fund Category: Morningstar Large Blend	7.41%
Performance Details	page 6
Schwab 1000 Index® Fund (Ticker Symbol: SNXFX)	8.00%
Schwab 1000 Index®	8.09%
Fund Category: Morningstar Large Blend	7.41%
Performance Details	page 7
Schwab Small-Cap Index Fund® (Ticker Symbol: SWSSX)	3.04%
Russell 2000® Index	3.08%
Fund Category: Morningstar Small Blend	4.48%
Performance Details	page 8
Schwab Total Stock Market Index Fund® (Ticker Symbol: SWTSX)	7.77%
Dow Jones U.S. Total Stock Market Index	7.82%
Fund Category: Morningstar Large Blend	7.41%
Performance Details	page 9
Schwab International Index Fund®1 (Ticker Symbol: SWISX)	4.73%
MSCI EAFE® Index (Net)	4.44%
Fund Category: Morningstar Foreign Large Blend	3.45%
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.

For index definitions, please see the Glossary.

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.

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 regarding the Schwab Equity Index Funds. Each fund employs an indexing strategy to track the performance of a particular stock market benchmark, seeking returns by modeling its portfolio according to the benchmark index.

For the six-month reporting period ended April 30, 2014, the funds generated returns that generally tracked their respective indices and reflected a rally by stocks. In the U.S., the Federal Reserve began “tapering” its stimulative economic policies. In spite of this policy shift, many major stock market indices reached record highs in April, supported by the Fed’s reassurances that low interest rates remained necessary for now. Overseas, signs of possible improvement in the euro zone’s economy and efforts by the European Central Bank to keep interest rates low helped stocks in developed markets generate positive returns. However, political unrest between Russia and the Ukraine drove up market volatility, increased risk,¹ and reduced returns.

Amid this backdrop, U.S. stocks outperformed stocks in developed international markets, and large-cap stocks outperformed small-cap stocks. Value stocks performed better overall than growth stocks, particularly late in the period as volatility rose, harsh winter weather temporarily slowed economic activity, and investors favored companies less tied to strong growth. Reflecting

 Asset Class Performance Comparison % returns during the six months ended 4/30/2014

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

	8.36%	S&P 500® Index: measures U.S. large-cap stocks
	3.08%	Russell 2000® Index: measures U.S. small-cap stocks
	4.44%	MSCI EAFE® Index (Net): measures (in U.S. dollars) large-cap stocks in Europe, Australasia and the Far East
	1.74%	Barclays U.S. Aggregate Bond Index: measures the U.S. bond market
	0.02%	Barclays U.S. Treasury Bills 1-3 Months Index: 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.

For index definitions, please see the Glossary.

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-month reporting period ended April 30, 2014, the funds generated returns that generally tracked their respective indices and reflected a rally by stocks.

this environment, the S&P 500 Index returned 8.4% and the MSCI EAFE Index returned 4.4%.²

For more information about the performance, holdings, and portfolio characteristics of the Schwab Equity Index Funds, please continue reading this report. In addition, you can find further details about these funds by visiting www.schwabfunds.com, or by contacting us at 1-800-435-4000.

Sincerely,

For full definitions of the referenced indices, please see the Glossary.

¹ To find out more information, please read “Investments in Russian Securities” in the “What’s New” section on www.schwabfunds.com.

² The total return cited is for the MSCI EAFE Index (Net), which is calculated net of foreign withholding taxes.

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 04/30/14

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)		8.29	%		20.29	%		19.02	%		7.63	%
S&P 500® Index		8.36	%		20.44	%		19.14	%		7.67	%
Fund Category: Morningstar Large Blend		7.41	%		19.35	%		17.82	%		7.17	%

Fund Expense Ratio³: 0.09%

 Statistics

Number of Holdings	503
Weighted Average Market Cap ($ x 1,000,000)	$121,990
Price/Earnings Ratio (P/E)	18.5
Price/Book Ratio (P/B)	2.6
Portfolio Turnover Rate4	1%

 Sector Weightings % of Investments

Information Technology	18.1%
Financials	15.6%
Health Care	12.9%
Consumer Discretionary	11.5%
Industrials	10.5%
Energy	10.3%
Consumer Staples	9.5%
Materials	3.4%
Utilities	3.1%
Telecommunication Services	2.4%
Other	2.7%
Total	100.0%

 Top Equity Holdings % of Net Assets⁵

Apple, Inc.	3.0%
Exxon Mobil Corp.	2.6%
Microsoft Corp.	1.8%
Johnson & Johnson	1.6%
General Electric Co.	1.6%
Chevron Corp.	1.4%
Wells Fargo & Co.	1.4%
Berkshire Hathaway, Inc., Class B	1.3%
The Procter & Gamble Co.	1.3%
JPMorgan Chase & Co.	1.2%
Total	17.2%

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.

For index definitions, please see the Glossary.

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.
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 04/30/14

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)		8.00	%		20.31	%		19.06	%		7.77	%
Schwab 1000 Index®		8.09	%		20.61	%		19.41	%		8.07	%
S&P 500® Index		8.36	%		20.44	%		19.14	%		7.67	%
Fund Category: Morningstar Large Blend		7.41	%		19.35	%		17.82	%		7.17	%

Fund Expense Ratios³: Net 0.30%; Gross 0.35%

 Statistics

Number of Holdings	998
Weighted Average Market Cap ($ x 1,000,000)	$107,688
Price/Earnings Ratio (P/E)	19.6
Price/Book Ratio (P/B)	2.6
Portfolio Turnover Rate4	2%

 Sector Weightings % of Investments

Information Technology	17.9%
Financials	16.6%
Health Care	12.8%
Consumer Discretionary	12.4%
Industrials	11.4%
Energy	10.1%
Consumer Staples	8.9%
Materials	3.7%
Utilities	3.1%
Telecommunication Services	2.3%
Other	0.8%
Total	100.0%

 Top Equity Holdings % of Net Assets⁵

Apple, Inc.	2.7%
Exxon Mobil Corp.	2.3%
Microsoft Corp.	1.6%
Johnson & Johnson	1.5%
General Electric Co.	1.4%
Chevron Corp.	1.2%
Wells Fargo & Co.	1.2%
Berkshire Hathaway, Inc., Class B	1.2%
The Procter & Gamble Co.	1.1%
JPMorgan Chase & Co.	1.1%
Total	15.3%

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.

For index definitions, please see the Glossary.

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. 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	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 04/30/14

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)		3.04	%		20.44	%		21.06	%		9.60	%
Russell 2000® Index		3.08	%		20.50	%		19.84	%		8.67	%
Small-Cap Spliced Index3		3.08	%		20.50	%		21.16	%		9.70	%
Fund Category: Morningstar Small Blend		4.48	%		21.54	%		19.86	%		8.76	%

Fund Expense Ratios⁴: Net 0.27%; Gross 0.30%

 Statistics

Number of Holdings	2,009
Weighted Average Market Cap ($ x 1,000,000)	$1,839
Price/Earnings Ratio (P/E)	55.7
Price/Book Ratio (P/B)	2.1
Portfolio Turnover Rate5	1%

 Sector Weightings % of Investments

Financials	22.7%
Information Technology	16.6%
Industrials	14.1%
Consumer Discretionary	12.5%
Health Care	12.5%
Energy	5.9%
Materials	4.7%
Consumer Staples	3.7%
Utilities	3.2%
Telecommunication Services	0.7%
Other	3.4%
Total	100.0%

 Top Equity Holdings % of Net Assets⁶

American Realty Capital Properties, Inc.	0.4%
Rite Aid Corp.	0.3%
Acuity Brands, Inc.	0.3%
NorthStar Realty Finance Corp.	0.3%
SunEdison, Inc.	0.3%
The Middleby Corp.	0.3%
CoStar Group, Inc.	0.3%
athenahealth, Inc.	0.3%
Kate Spade & Co.	0.2%
Questcor Pharmaceuticals, Inc.	0.2%
Total	2.9%

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.

For index definitions, please see the Glossary.

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 many 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. 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 0.10%. 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 04/30/14

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)		7.77	%		20.60	%		19.50	%		8.29	%
Dow Jones U.S. Total Stock Market Index		7.82	%		20.65	%		19.62	%		8.27	%
Fund Category: Morningstar Large Blend		7.41	%		19.35	%		17.82	%		7.17	%

Fund Expense Ratios³: Net 0.09%; Gross 0.10%

 Statistics

Number of Holdings	2,411
Weighted Average Market Cap ($ x 1,000,000)	$99,304
Price/Earnings Ratio (P/E)	20.7
Price/Book Ratio (P/B)	2.5
Portfolio Turnover Rate4	0%	5

 Sector Weightings % of Investments

Information Technology	17.4%
Financials	16.8%
Health Care	12.5%
Consumer Discretionary	12.2%
Industrials	11.3%
Energy	9.6%
Consumer Staples	8.3%
Materials	3.8%
Utilities	3.1%
Telecommunication Services	2.2%
Other	2.8%
Total	100.0%

 Top Equity Holdings % of Net Assets⁶

Apple, Inc.	2.5%
Exxon Mobil Corp.	2.1%
Microsoft Corp.	1.4%
Johnson & Johnson	1.3%
General Electric Co.	1.2%
Chevron Corp.	1.1%
Wells Fargo & Co.	1.1%
Berkshire Hathaway, Inc., Class B	1.1%
The Procter & Gamble Co.	1.1%
JPMorgan Chase & Co.	1.0%
Total	13.9%

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.

For index definitions, please see the Glossary.

“Dow Jones” and “The Dow Jones U.S. Total Stock Market Index” 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, 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	Less than 1%.
6	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 04/30/14

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)		4.73	%		13.45	%		13.72	%		6.98	%
MSCI EAFE® Index (Net)		4.44	%		13.35	%		13.58	%		6.93	%
International Spliced Index		4.44	%		13.35	%		13.67	%		7.17	%
Fund Category: Morningstar Foreign Large Blend		3.45	%		11.69	%		13.12	%		6.74	%

Fund Expense Ratios³: 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.

For index definitions, please see the Glossary.

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	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 04/30/14 continued

 Statistics

Number of Holdings	922
Weighted Average Market Cap ($ x 1,000,000)	$68,061
Price/Earnings Ratio (P/E)	17.8
Price/Book Ratio (P/B)	1.6
Portfolio Turnover Rate1	1%

 Sector Weightings % of Investments

Financials	25.0%
Industrials	12.4%
Consumer Discretionary	11.3%
Consumer Staples	10.9%
Health Care	10.3%
Materials	8.1%
Energy	7.2%
Telecommunication Services	4.9%
Information Technology	4.2%
Utilities	3.6%
Other	2.1%
Total	100.0%

 Top Equity Holdings % of Net Assets²

Nestle S.A. – Reg’d	1.8%
Roche Holding AG	1.5%
Novartis AG – Reg’d	1.5%
HSBC Holdings plc	1.4%
BP plc	1.1%
Total S.A.	1.1%
Royal Dutch Shell plc, A Shares	1.1%
Toyota Motor Corp.	1.1%
GlaxoSmithKline plc	1.0%
Sanofi	0.9%
Total	12.5%

 Country Weightings % of Investments

United Kingdom	21.2%
Japan	18.6%
France	10.3%
Germany	9.2%
Switzerland	9.1%
Australia	7.8%
Spain	3.5%
Sweden	3.2%
Hong Kong	2.7%
Netherlands	2.6%
Other Countries	11.8%
Total	100.0%

Portfolio holdings may have changed since the report date.

Source of Sector Classification: S&P and MSCI.

International investments are subject to additional risks such as currency fluctuation, geopolitical risk and the potential for illiquid markets.

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 may incur two types of costs: (1) transaction costs, such as redemption fees; and (2) ongoing costs, including 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, 2013 and held through April 30, 2014.

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 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 a 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. Therefore, the hypothetical return lines of the table are useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, 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 11/1/13		at 4/30/14		11/1/13–4/30/14
Schwab® S&P 500 Index Fund
Actual Return		0.09%	$	1,000.00	$	1,082.90	$	0.46
Hypothetical 5% Return		0.09%	$	1,000.00	$	1,024.35	$	0.45
Schwab 1000 Index® Fund
Actual Return		0.29%	$	1,000.00	$	1,080.00	$	1.50
Hypothetical 5% Return		0.29%	$	1,000.00	$	1,023.36	$	1.45
Schwab Small-Cap Index Fund®
Actual Return		0.17%	$	1,000.00	$	1,030.40	$	0.86
Hypothetical 5% Return		0.17%	$	1,000.00	$	1,023.95	$	0.85
Schwab Total Stock Market Index Fund®
Actual Return		0.09%	$	1,000.00	$	1,077.70	$	0.46
Hypothetical 5% Return		0.09%	$	1,000.00	$	1,024.35	$	0.45
Schwab International Index Fund®
Actual Return		0.19%	$	1,000.00	$	1,047.30	$	0.96
Hypothetical 5% Return		0.19%	$	1,000.00	$	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

	11/1/13–			11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–
	4/30/14*			10/31/13			10/31/12			10/31/11			10/31/10			10/31/091
Per-Share Data ($)
Net asset value at beginning of period		27.78			22.35			19.82			18.70			16.28			15.28
Income (loss) from investment operations:
Net investment income (loss)		0.28			0.52			0.44			0.39			0.35			0.20
Net realized and unrealized gains (losses)		1.99			5.40			2.49			1.09			2.31			1.22
Total from investment operations		2.27			5.92			2.93			1.48			2.66			1.42
Less distributions:
Distributions from net investment income		(0.48	)		(0.49	)		(0.40	)		(0.36	)		(0.24	)		(0.42	)
Net asset value at end of period		29.57			27.78			22.35			19.82			18.70			16.28
Total return (%)		8.29	2		27.06			15.09			7.97			16.50			9.81
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		0.09	3		0.09			0.09			0.09			0.09			0.13	4
Gross operating expenses		0.09	3		0.09			0.10			0.10			0.10			0.16
Net investment income (loss)		1.95	3		2.10			2.09			1.96			1.97			2.09
Portfolio turnover rate		1	2		1			2			3			2			3	5
Net assets, end of period ($ x 1,000,000)		18,773			17,121			12,687			10,909			10,007			8,718

* 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 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, 2014 (Unaudited)

This section shows the fund’s 50 largest portfolio holdings in unaffiliated issuers, and any holdings exceeding 1% of the fund’s 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	.1%	Common Stock		10,549,726,052		18,226,492,414
	2	.7%	Short-Term Investments		501,698,441		501,698,441
	99	.8%	Total Investments		11,051,424,493		18,728,190,855
	0	.1%	Collateral Invested for Securities on Loan		14,846,312		14,846,312
	0	.1%	Other Assets and Liabilities, Net				29,598,683
	100	.0%	Net Assets				18,772,635,850

	Number		% of Net		Value
Security	of Shares		Assets		($)
Common Stock 97.1% of net assets
Automobiles & Components 1.1%
Other Securities				1.1		209,580,098
Banks 5.9%
Bank of America Corp.		11,448,611		0.9		173,331,970
Citigroup, Inc.		3,293,247		0.9		157,779,464
JPMorgan Chase & Co.		4,107,131		1.2		229,917,193
Wells Fargo & Co.		5,193,209		1.4		257,790,895
Other Securities				1.5		279,269,519
				5.9		1,098,089,041
Capital Goods 7.9%
3M Co.		691,919		0.5		96,239,014
General Electric Co.		10,881,752		1.6		292,610,311
The Boeing Co.		739,654		0.5		95,430,159
United Technologies Corp.		913,235		0.6		108,063,097
Other Securities				4.7		886,142,025
				7.9		1,478,484,606
Commercial & Professional Supplies 0.6%
Other Securities				0.6		120,722,320
Consumer Durables & Apparel 1.3%
Other Securities				1.3		242,692,075
Consumer Services 1.7%
McDonald’s Corp.		1,073,638		0.6		108,845,420
Other Securities				1.1		209,500,213
				1.7		318,345,633
Diversified Financials 4.8%
American Express Co.		983,641		0.5		85,999,733
Berkshire Hathaway, Inc., Class B *		1,952,430		1.3		251,570,605
The Charles Schwab Corp. (a)		1,267,581		0.2		33,654,276
Other Securities				2.8		527,490,742
				4.8		898,715,356
Energy 10.3%
Chevron Corp.		2,070,634		1.4		259,905,980
ConocoPhillips		1,329,790		0.5		98,816,695
Exxon Mobil Corp.		4,687,841		2.6		480,081,797
Occidental Petroleum Corp.		858,650		0.4		82,215,737
Schlumberger Ltd.		1,420,015		0.8		144,202,523
Other Securities				4.6		865,613,223
				10.3		1,930,835,955
Food & Staples Retailing 2.3%
CVS Caremark Corp.		1,274,951		0.5		92,714,437
Wal-Mart Stores, Inc.		1,754,702		0.7		139,867,296
Other Securities				1.1		197,323,268
				2.3		429,905,001
Food, Beverage & Tobacco 5.1%
Altria Group, Inc.		2,186,791		0.5		87,712,187
PepsiCo, Inc.		1,643,463		0.7		141,157,037
Philip Morris International, Inc.		1,724,346		0.8		147,310,879
The Coca-Cola Co.		4,109,556		0.9		167,628,789
Other Securities				2.2		414,776,598
				5.1		958,585,490
Health Care Equipment & Services 4.0%
Other Securities				4.0		751,625,061
Household & Personal Products 2.1%
The Procter & Gamble Co.		2,940,690		1.3		242,753,959
Other Securities				0.8		149,006,305
				2.1		391,760,264
Insurance 2.8%
American International Group, Inc.		1,587,854		0.5		84,362,683
Other Securities				2.3		440,204,177
				2.8		524,566,860
Materials 3.4%
Other Securities				3.4		638,521,501

14 See financial notes

 Schwab S&P 500 Index Fund

Portfolio Holdings (Unaudited) continued

	Number		% of Net		Value
Security	of Shares		Assets		($)
Media 3.4%
Comcast Corp., Class A		2,826,964		0.8		146,323,657
The Walt Disney Co.		1,767,183		0.7		140,208,299
Other Securities				1.9		360,109,063
				3.4		646,641,019
Pharmaceuticals, Biotechnology & Life Sciences 8.8%
AbbVie, Inc.		1,722,886		0.5		89,727,903
Amgen, Inc.		818,859		0.5		91,507,493
Bristol-Myers Squibb Co.		1,783,064		0.5		89,313,676
Gilead Sciences, Inc. *		1,668,350		0.7		130,948,792
Johnson & Johnson		3,068,125		1.6		310,770,381
Merck & Co., Inc.		3,189,314		1.0		186,766,228
Pfizer, Inc.		6,942,233		1.1		217,153,048
Other Securities				2.9		541,650,979
				8.8		1,657,838,500
Real Estate 2.2%
Other Securities				2.2		413,409,920
Retailing 4.0%
Amazon.com, Inc. *		403,480		0.7		122,710,372
The Home Depot, Inc.		1,527,350		0.6		121,439,598
Other Securities				2.7		498,138,708
				4.0		742,288,678
Semiconductors & Semiconductor Equipment 2.0%
Intel Corp.		5,392,505		0.8		143,925,958
Other Securities				1.2		234,928,794
				2.0		378,854,752
Software & Services 9.8%
Facebook, Inc., Class A *		1,852,800		0.6		110,760,384
Google, Inc., Class A *		306,158		0.9		163,757,791
Google, Inc., Class C *		306,158		0.9		161,241,172
International Business Machines Corp.		1,069,690		1.1		210,161,994
Microsoft Corp.		8,192,531		1.8		330,978,252
Oracle Corp.		3,758,986		0.8		153,667,348
Visa, Inc., Class A		549,800		0.6		111,394,978
Other Securities				3.1		591,569,900
				9.8		1,833,531,819
Technology Hardware & Equipment 6.2%
Apple, Inc.		967,431		3.0		570,871,359
Cisco Systems, Inc.		5,646,928		0.7		130,500,506
QUALCOMM, Inc.		1,834,065		0.8		144,359,256
Other Securities				1.7		326,776,505
				6.2		1,172,507,626
Telecommunication Services 2.4%
AT&T, Inc.		5,672,236		1.1		202,498,825
Verizon Communications, Inc.		4,491,378		1.1		209,882,094
Other Securities				0.2		34,491,985
				2.4		446,872,904
Transportation 1.9%
Union Pacific Corp.		492,175		0.5		93,724,885
Other Securities				1.4		269,694,850
				1.9		363,419,735
Utilities 3.1%
Other Securities				3.1		578,698,200
Total Common Stock
(Cost $10,549,726,052)						18,226,492,414
	Face
Security	Amount		% of Net		Value
Rate, Maturity Date	($)		Assets		($)
Short-Term Investments 2.7% of net assets
Time Deposits 2.5%
Wells Fargo
0.03%, 05/01/14		398,692,850		2.1		398,692,850
Other Securities				0.4		73,007,633
				2.5		471,700,483
U.S. Treasury Obligations 0.2%
Other Securities				0.2		29,997,958
Total Short-Term Investments
(Cost $501,698,441)						501,698,441
End of Investments.
	Number		% of Net		Value
Security	of Shares		Assets		($)
Collateral Invested for Securities on Loan 0.1% of net assets
Wells Fargo Advantage Government Money Market Fund, Institutional Class 0.01% (e)		14,846,312		0.1		14,846,312
Total Collateral Invested for Securities on Loan
(Cost $14,846,312)						14,846,312
End of Collateral Invested for Securities on Loan.

At 04/30/14, tax basis cost of the fund’s investments was $11,093,131,863 and the unrealized appreciation and depreciation were $8,118,138,549 and ($483,079,557), respectively, with a net unrealized appreciation of $7,635,058,992.

For the following notes, please refer to the complete schedule of portfolio 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. Securities on loan were valued at $14,879,804.
(c)	All or a portion of this security is held as collateral for open futures contracts.
(d)	The rate shown is the purchase yield.
(e)	The rate shown is the 7-day yield.

See financial notes 15

 Schwab S&P 500 Index Fund

Portfolio Holdings (Unaudited) continued

REIT — Real Estate Investment Trust

In addition to the above, the fund held the following at 04/30/14:

			Contract		Unrealized
	Number of		Value		Appreciation
	Contracts		($)		($)
Futures Contracts
S&P 500 Index, e-mini, Long, expires 06/20/14		5,500		516,422,500		9,564,070

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2014 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Other Significant		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Common Stock1		$18,226,492,414		$—		$—		$18,226,492,414
Short-Term Investments1		—		501,698,441		—		501,698,441
Total		$18,226,492,414		$501,698,441		$—		$18,728,190,855
Other Financial Instruments
Collateral Invested for Securities on Loan		$14,846,312		$—		$—		$14,846,312
Futures Contracts2		9,564,070		—		—		9,564,070

1	As categorized in the complete schedule of portfolio holdings.
2	Futures contracts are not included in Investments in the schedule of portfolio holdings 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, 2014.

16 See financial notes

 Schwab S&P 500 Index Fund

Statement of

Assets and Liabilities

As of April 30, 2014; unaudited

Assets
Investments in affiliated issuers, at value (cost $16,522,060)		$33,654,276
Investments in unaffiliated issuers, at value (cost $11,034,902,433) including securities on loan of $14,879,804	+	18,694,536,579
Total investments, at value (cost $11,051,424,493)		18,728,190,855
Collateral invested for securities on loan		14,846,312
Receivables:
Investments sold		28,224,627
Fund shares sold		33,950,792
Dividends		16,861,129
Variation margin on futures contracts		1,610,116
Income from securities on loan		26,943
Interest		393
Prepaid expenses	+	144,184
Total assets		18,823,855,351
Liabilities
Collateral held for securities on loan		14,846,312
Payables:
Investments bought		16,248,355
Investment adviser and administrator fees		92,827
Shareholder service fees		35,968
Fund shares redeemed		19,715,282
Accrued expenses	+	280,757
Total liabilities		51,219,501
Net Assets
Total assets		18,823,855,351
Total liabilities	−	51,219,501
Net assets		$18,772,635,850
Net Assets by Source
Capital received from investors		11,334,250,739
Net investment income not yet distributed		107,556,071
Net realized capital losses		(355,501,392	)
Net unrealized capital appreciation		7,686,330,432
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$18,772,635,850		634,749,898			$29.57

See financial notes 17

 Schwab S&P 500 Index Fund

Statement of

Operations

For the period November 1, 2013 through April 30, 2014; unaudited

Investment Income
Dividends received from affiliated issuer		$147,886
Dividends received from unaffiliated issuers		181,272,135
Interest		75,352
Securities on loan	+	103,431
Total investment income		181,598,804
Expenses
Investment adviser and administrator fees		5,351,809
Shareholder service fees		1,718,505
Portfolio accounting fees		187,818
Transfer agent fees		185,500
Shareholder reports		165,998
Custodian fees		147,400
Registration fees		90,786
Independent trustees’ fees		46,725
Professional fees		44,649
Index fee		37,379
Other expenses	+	165,757
Total expenses		8,142,326
Expense reduction by CSIM and its affiliates	−	185,500
Net expenses	−	7,956,826
Net investment income		173,641,978
Realized and Unrealized Gains (Losses)
Net realized losses on unaffiliated investments		(50,404,108	)
Net realized gains on futures contracts	+	39,704,300
Net realized losses		(10,699,808	)
Net change in unrealized appreciation (depreciation) on affiliated issuer		4,736,667
Net change in unrealized appreciation (depreciation) on unaffiliated investments		1,266,246,993
Net change in unrealized appreciation (depreciation) on futures contracts	+	(1,387,033	)
Net change in unrealized appreciation (depreciation)	+	1,269,596,627
Net realized and unrealized gains		1,258,896,819
Increase in net assets resulting from operations		$1,432,538,797

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

11/1/13-4/30/14				11/1/12-10/31/13
Net investment income		$173,641,978			$311,029,585
Net realized gains (losses)		(10,699,808	)		53,530,089
Net change in unrealized appreciation (depreciation)	+	1,269,596,627			3,166,704,651
Increase in net assets from operations		1,432,538,797			3,531,264,325
Distributions to Shareholders
Distributions from net investment income		($297,103,536	)		($278,278,089	)

Transactions in Fund Shares

		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		VALUE			SHARES		VALUE
Shares sold			69,737,443		$1,997,823,716			155,380,507		$3,830,088,605
Shares reinvested			7,894,318		218,593,671			11,251,940		248,330,312
Shares redeemed	+		(59,295,853	)	(1,700,255,422	)		(117,760,806	)	(2,897,316,141	)
Net transactions in fund shares			18,335,908		$516,161,965			48,871,641		$1,181,102,776
Shares Outstanding and Net Assets
		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			616,413,990		$17,121,038,624			567,542,349		$12,686,949,612
Total increase	+		18,335,908		1,651,597,226			48,871,641		4,434,089,012
End of period			634,749,898		$18,772,635,850			616,413,990		$17,121,038,624
Net investment income not yet distributed					$107,556,071					$231,017,629

See financial notes 19

Schwab 1000 Index^® Fund

Financial Statements

Financial Highlights

	11/1/13–			11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–
	4/30/14*			10/31/13			10/31/12			10/31/11			10/31/10			10/31/091
Per-Share Data ($)
Net asset value at beginning of period		48.31			40.23			37.44			35.79			31.00			28.69
Income (loss) from investment operations:
Net investment income (loss)		0.41	2		0.81	2		0.71	2		0.62	2		0.57	2		0.54	2
Net realized and unrealized gains (losses)		3.31			9.74			4.32			2.07			4.80			2.41
Total from investment operations		3.72			10.55			5.03			2.69			5.37			2.95
Less distributions:
Distributions from net investment income		(0.75	)		(0.81	)		(0.72	)		(0.57	)		(0.58	)		(0.64	)
Distributions from net realized gains		(1.50	)		(1.66	)		(1.52	)		(0.47	)		—			—
Total distributions		(2.25	)		(2.47	)		(2.24	)		(1.04	)		(0.58	)		(0.64	)
Net asset value at end of period		49.78			48.31			40.23			37.44			35.79			31.00
Total return (%)		8.00	3		27.85			14.38			7.60			17.51			10.72
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		0.29	4		0.29			0.29			0.29			0.29			0.38	5
Gross operating expenses		0.33	4		0.34			0.34			0.34			0.35			0.44
Net investment income (loss)		1.69	4		1.87			1.85			1.64			1.71			1.96
Portfolio turnover rate		2	3		4			4			5			5			4
Net assets, end of period ($ x 1,000,000)		6,178			5,887			4,848			4,552			4,575			4,279

* 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, 2014 (Unaudited)

This section shows the fund’s 50 largest portfolio holdings in unaffiliated issuers, and any holdings exceeding 1% of the fund’s 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	.6%	Common Stock		1,968,379,173		6,153,539,781
	0	.7%	Other Investment Company		44,979,602		44,979,602
	0	.1%	Short-Term Investment		2,579,839		2,579,839
	100	.4%	Total Investments		2,015,938,614		6,201,099,222
	0	.3%	Collateral Invested for Securities on Loan		21,473,000		21,473,000
	(0	.7%)	Other Assets and Liabilities, Net				(44,305,219	)
	100	.0%	Net Assets				6,178,267,003

	Number		% of Net			Value
Security	of Shares		Assets			($)
Common Stock 99.6% of net assets
Automobiles & Components 1.3%
Other Securities				1.3			80,871,063
Banks 5.6%
Bank of America Corp.		3,383,941		0.8			51,232,867
Citigroup, Inc.		975,256		0.8			46,724,515
JPMorgan Chase & Co.		1,212,578		1.1			67,880,116
Wells Fargo & Co.		1,532,396		1.2			76,068,138
Other Securities				1.7			105,559,721
					��
				5.6			347,465,357
Capital Goods 8.5%
3M Co.		201,554		0.4			28,034,146
General Electric Co.		3,212,602		1.4			86,386,868
The Boeing Co.		217,589		0.5			28,073,333
United Technologies Corp.		270,303		0.5			31,984,954
Other Securities				5.7			349,558,830
				8.5			524,038,131
Commercial & Professional Supplies 0.8%
Other Securities				0.8			52,104,047
Consumer Durables & Apparel 1.5%
Other Securities				1.5			89,327,044
Consumer Services 2.0%
McDonald’s Corp.		318,736		0.5			32,313,456
Other Securities				1.5			91,489,792
				2.0			123,803,248
Diversified Financials 4.7%
American Express Co.		294,377		0.4			25,737,381
Berkshire Hathaway, Inc., Class B *		575,312		1.2			74,128,951
The Charles Schwab Corp. (a)		367,065		0.2			9,745,576
Other Securities				2.9			179,922,197
				4.7			289,534,105
Energy 10.2%
Chevron Corp.		611,337		1.2			76,735,020
ConocoPhillips		390,966		0.5			29,052,683
Exxon Mobil Corp.		1,383,663		2.3			141,700,928
Occidental Petroleum Corp.		254,516		0.4			24,369,907
Schlumberger Ltd.		417,347		0.7			42,381,588
Other Securities				5.1			313,167,854
				10.2			627,407,980
Food & Staples Retailing 2.1%
CVS Caremark Corp.		380,011		0.4			27,634,400
Wal-Mart Stores, Inc.		520,227		0.7			41,467,294
Other Securities				1.0			61,330,853
				2.1			130,432,547
Food, Beverage & Tobacco 4.8%
Altria Group, Inc.		635,805		0.4			25,502,138
PepsiCo, Inc.		487,485		0.7			41,870,087
Philip Morris International, Inc.		507,565		0.7			43,361,278
The Coca-Cola Co.		1,213,848		0.8			49,512,860
Other Securities				2.2			136,150,504
				4.8			296,396,867
Health Care Equipment & Services 4.2%
Other Securities				4.2			258,130,813
Household & Personal Products 2.0%
The Procter & Gamble Co.		868,219		1.1			71,671,478
Other Securities				0.9			53,791,069
				2.0			125,462,547
Insurance 3.1%
American International Group, Inc.		472,176		0.4			25,086,711
Other Securities				2.7			167,353,756
				3.1			192,440,467
Materials 3.8%
Other Securities				3.8			232,074,497

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		837,923		0.7		43,370,894
The Walt Disney Co.		519,260		0.7		41,198,088
Other Securities				2.2		138,089,123
				3.6		222,658,105
Pharmaceuticals, Biotechnology & Life Sciences 8.6%
AbbVie, Inc.		508,646		0.4		26,490,284
Amgen, Inc.		240,902		0.5		26,920,798
Bristol-Myers Squibb Co.		526,739		0.4		26,384,357
Gilead Sciences, Inc. *		492,444		0.6		38,651,930
Johnson & Johnson		907,287		1.5		91,899,100
Merck & Co., Inc.		939,218		0.9		55,000,606
Pfizer, Inc.		2,043,851		1.0		63,931,659
Other Securities				3.3		203,718,098
				8.6		532,996,832
Real Estate 3.2%
Other Securities				3.2		197,660,428
Retailing 4.0%
Amazon.com, Inc. *		119,341		0.6		36,295,178
The Home Depot, Inc.		451,735		0.6		35,917,450
Other Securities				2.8		177,269,241
				4.0		249,481,869
Semiconductors & Semiconductor Equipment 2.2%
Intel Corp.		1,597,980		0.7		42,650,086
Other Securities				1.5		90,014,926
				2.2		132,665,012
Software & Services 9.9%
Facebook, Inc., Class A *		547,600		0.5		32,735,528
Google, Inc., Class A *		90,388		0.8		48,346,733
Google, Inc., Class C *		90,388		0.8		47,603,744
International Business Machines Corp.		313,440		1.0		61,581,557
Microsoft Corp.		2,418,738		1.6		97,717,015
Oracle Corp.		1,108,910		0.7		45,332,241
Visa, Inc., Class A		163,700		0.5		33,167,257
Other Securities				4.0		244,422,415
				9.9		610,906,490
Technology Hardware & Equipment 5.9%
Apple, Inc.		285,618		2.7		168,540,326
Cisco Systems, Inc.		1,649,415		0.6		38,117,981
QUALCOMM, Inc.		542,678		0.7		42,714,185
Other Securities				1.9		117,481,969
				5.9		366,854,461
Telecommunication Services 2.3%
AT&T, Inc.		1,667,277		0.9		59,521,789
Verizon Communications, Inc.		1,324,157		1.0		61,877,857
Other Securities				0.4		22,452,656
				2.3		143,852,302
Transportation 2.1%
Union Pacific Corp.		145,662		0.4		27,738,415
Other Securities				1.7		103,777,813
				2.1		131,516,228
Utilities 3.2%
Other Securities				3.2		195,459,341
Total Common Stock
(Cost $1,968,379,173)						6,153,539,781
Other Investment Company 0.7% of net assets
Money Market Fund 0.7%
State Street Institutional U.S. Government Money Market Fund, Institutional Class 0.00% (e)		44,979,602		0.7		44,979,602
Total Other Investment Company
(Cost $44,979,602)						44,979,602
	Face
Security	Amount		% of Net		Value
Rate, Maturity Date	($)		Assets		($)
Short-Term Investment 0.1% of net assets
U.S. Treasury Obligation 0.1%
Other Securities				0.1		2,579,839
Total Short-Term Investment
(Cost $2,579,839)						2,579,839
End of Investments.
	Number		% of Net		Value
Security	of Shares		Assets		($)
Collateral Invested for Securities on Loan 0.3% of net assets
State Street Institutional U.S. Government Money Market Fund, Institutional Class 0.00% (e)		21,473,000		0.3		21,473,000
Total Collateral Invested for Securities on Loan
(Cost $21,473,000)						21,473,000
End of Collateral Invested for Securities on Loan.

At 04/30/14, tax basis cost of the fund’s investments was $1,994,876,427 and the unrealized appreciation and depreciation were $4,232,768,822 and ($26,546,027), respectively, with a net unrealized appreciation of $4,206,222,795.

22 See financial notes

 Schwab 1000 Index Fund

Portfolio Holdings (Unaudited) continued

For the following notes, please refer to the complete schedule of portfolio 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. Securities on loan were valued at $25,843,096.
(c)	All or a portion of this security is held as collateral for open futures contracts.
(d)	The rate shown is the purchase yield.
(e)	The rate shown is the 7-day yield.

REIT — Real Estate Investment Trust

In addition to the above, the fund held the following at 04/30/14:

			Contract		Unrealized
	Number of		Value		Appreciation
	Contracts		($)		($)
Futures Contracts
S&P 500 Index, e-mini, Long, expires 06/20/14		220		20,656,900		296,777

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2014 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Other Significant		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Common Stock1		$6,153,539,781		$—		$—		$6,153,539,781
Other Investment Company1		44,979,602		—		—		44,979,602
Short-Term Investment1		—		2,579,839		—		2,579,839
Total		$6,198,519,383		$2,579,839		$—		$6,201,099,222
Other Financial Instruments
Collateral Invested for Securities on Loan		$21,473,000		$—		$—		$21,473,000
Futures Contracts2		296,777		—		—		296,777

1	As categorized in the complete schedule of portfolio holdings.
2	Futures contracts are not included in Investments in the schedule of portfolio holdings 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, 2014.

See financial notes 23

 Schwab 1000 Index Fund

Statement of

Assets and Liabilities

As of April 30, 2014; unaudited

Assets
Investments in affiliated issuers, at value (cost $1,803,228)		$9,745,576
Investments in unaffiliated issuers, at value (cost $2,014,135,386) including securities on loan of $25,843,096	+	6,191,353,646
Total investments, at value (cost $2,015,938,614)		6,201,099,222
Collateral invested for securities on loan		21,473,000
Receivables:
Investments sold		4,409,456
Dividends		5,239,770
Fund shares sold		2,238,389
Variation margin on futures contracts		163,274
Income from securities on loan		52,432
Prepaid expenses	+	79,460
Total assets		6,234,755,003
Liabilities
Collateral held for securities on loan		21,473,000
Payables:
Investment adviser and administrator fees		92,772
Shareholder service fees		55,458
Independent trustees’ fees		1,164
Fund shares redeemed		34,736,311
Accrued expenses	+	129,295
Total liabilities		56,488,000
Net Assets
Total assets		6,234,755,003
Total liabilities	−	56,488,000
Net assets		$6,178,267,003
Net Assets by Source
Capital received from investors		1,843,328,828
Net investment income not yet distributed		31,239,147
Net realized capital gains		118,241,643
Net unrealized capital appreciation		4,185,457,385
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$6,178,267,003		124,114,245			$49.78

24 See financial notes

 Schwab 1000 Index Fund

Statement of

Operations

For the period November 1, 2013 through April 30, 2014; unaudited

Investment Income
Dividends received from affiliated issuer		$44,048
Dividends received from unaffiliated issuers (net of foreign withholding taxes of $1,759)		59,419,396
Interest		529
Securities on loan	+	269,457
Total investment income		59,733,430
Expenses
Investment adviser and administrator fees		6,719,013
Shareholder service fees		2,921,014
Shareholder reports		86,871
Portfolio accounting fees		80,783
Custodian fees		51,572
Transfer agent fees		45,748
Professional fees		29,705
Independent trustees’ fees		26,216
Registration fees		21,165
Interest expense		176
Other expenses	+	58,745
Total expenses		10,041,008
Expense reduction by CSIM and its affiliates	−	1,304,921
Net expenses	−	8,736,087
Net investment income		50,997,343
Realized and Unrealized Gains (Losses)
Net realized gains on unaffiliated investments		90,947,120
Net realized gains on futures contracts	+	6,577,236
Net realized gains		97,524,356
Net change in unrealized appreciation (depreciation) on affiliated issuer		1,431,554
Net change in unrealized appreciation (depreciation) on unaffiliated investments		318,146,407
Net change in unrealized appreciation (depreciation) on futures contracts	+	(2,012,686	)
Net change in unrealized appreciation (depreciation)	+	317,565,275
Net realized and unrealized gains		415,089,631
Increase in net assets resulting from operations		$466,086,974

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

11/1/13-4/30/14				11/1/12-10/31/13
Net investment income		$50,997,343			$99,492,905
Net realized gains		97,524,356			178,811,471
Net change in unrealized appreciation (depreciation)	+	317,565,275			1,026,638,598
Increase in net assets from operations		466,086,974			1,304,942,974
Distributions to Shareholders
Distributions from net investment income		(91,043,881	)		(96,597,152	)
Distributions from net realized gains	+	(182,379,726	)		(197,828,775	)
Total distributions		($273,423,607	)		($294,425,927	)

Transactions in Fund Shares

		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		VALUE			SHARES		VALUE
Shares sold			4,323,561		$210,008,414			9,372,908		$400,294,068
Shares reinvested			5,073,441		236,878,978			6,695,843		255,781,218
Shares redeemed	+		(7,143,869	)	(348,515,356	)		(14,700,117	)	(627,358,330	)
Net transactions in fund shares			2,253,133		$98,372,036			1,368,634		$28,716,956
Shares Outstanding and Net Assets
		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			121,861,112		$5,887,231,600			120,492,478		$4,847,997,597
Total increase	+		2,253,133		291,035,403			1,368,634		1,039,234,003
End of period			124,114,245		$6,178,267,003			121,861,112		$5,887,231,600
Net investment income not yet distributed					$31,239,147					$71,285,685

26 See financial notes

Schwab Small-Cap Index Fund^®

Financial Statements

Financial Highlights

	11/1/13–			11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–
	4/30/14*			10/31/13			10/31/12			10/31/11			10/31/10			10/31/091
Per-Share Data ($)
Net asset value at beginning of period		27.62			21.26			20.55			19.18			15.14			13.85
Income (loss) from investment operations:
Net investment income (loss)		0.19	2		0.42	2		0.33	2		0.25	2		0.22	2		0.18	2
Net realized and unrealized gains (losses)		0.61			6.94			1.89			1.37			3.97			1.40
Total from investment operations		0.80			7.36			2.22			1.62			4.19			1.58
Less distributions:
Distributions from net investment income		(0.31	)		(0.50	)		(0.35	)		(0.20	)		(0.15	)		(0.29	)
Distributions from net realized gains		(1.29	)		(0.50	)		(1.16	)		(0.05	)		—			—
Total distributions		(1.60	)		(1.00	)		(1.51	)		(0.25	)		(0.15	)		(0.29	)
Net asset value at end of period		26.82			27.62			21.26			20.55			19.18			15.14
Total return (%)		3.04	3		36.23			11.87			8.45			27.85			11.98
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		0.17	4		0.17			0.17			0.19			0.19			0.28	5
Gross operating expenses		0.20	4		0.20			0.21			0.19			0.20			0.33
Net investment income (loss)		1.43	4		1.76			1.63			1.18			1.23			1.41
Portfolio turnover rate		1	3		11			41	6		26			33			26
Net assets, end of period ($ x 1,000,000)		2,518			2,351			1,675			1,502			1,406			1,142

* 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, 2014 (Unaudited)

This section shows the fund’s 50 largest portfolio holdings in unaffiliated issuers, and any holdings exceeding 1% of the fund’s 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	.2%	Common Stock		1,658,448,442		2,422,381,678
	0	.0%	Rights		213,444		213,444
	0	.0%	Warrants		—		—
	3	.3%	Short-Term Investments		81,905,229		81,905,229
	99	.5%	Total Investments		1,740,567,115		2,504,500,351
	4	.9%	Collateral Invested for Securities on Loan		122,988,021		122,988,021
	(4	.4%)	Other Assets and Liabilities, Net				(109,646,051	)
	100	.0%	Net Assets				2,517,842,321

	Number		% of Net		Value
Security	of Shares		Assets		($)
Common Stock 96.2% of net assets
Automobiles & Components 1.1%
Dana Holding Corp.		236,000		0.2		4,996,120
Tenneco, Inc. *		92,000		0.2		5,508,040
Other Securities				0.7		16,749,818
				1.1		27,253,978
Banks 8.5%
FirstMerit Corp.		246,215		0.2		4,774,109
PacWest Bancorp		139,751		0.2		5,501,997
Prosperity Bancshares, Inc.		97,100		0.2		5,728,900
Other Securities				7.9		197,400,604
				8.5		213,405,610
Capital Goods 9.0%
Acuity Brands, Inc.		64,400		0.3		8,022,308
EMCOR Group, Inc.		99,500		0.2		4,576,005
EnerSys, Inc.		71,178		0.2		4,810,209
Esterline Technologies Corp. *		47,000		0.2		5,123,940
Generac Holdings, Inc.		77,300		0.2		4,551,424
HEICO Corp.		100,206		0.2		5,543,396
Teledyne Technologies, Inc. *		55,300		0.2		5,135,158
The Middleby Corp. *		28,252		0.3		7,133,065
Woodward, Inc.		102,600		0.2		4,599,558
Other Securities				7.0		176,174,597
				9.0		225,669,660
Commercial & Professional Supplies 3.3%
Other Securities				3.3		83,547,809
Consumer Durables & Apparel 2.8%
Brunswick Corp.		134,200		0.2		5,393,498
Kate Spade & Co. *		189,400		0.2		6,585,438
Other Securities				2.4		59,828,041
				2.8		71,806,977
Consumer Services 3.5%
Other Securities				3.5		88,308,081
Diversified Financials 3.5%
Prospect Capital Corp.		465,800		0.2		5,035,298
Other Securities				3.3		84,364,430
				3.5		89,399,728
Energy 5.9%
Kodiak Oil & Gas Corp. *		393,800		0.2		5,005,198
Targa Resources Corp.		48,900		0.2		5,280,711
Other Securities				5.5		137,660,108
				5.9		147,946,017
Food & Staples Retailing 1.2%
Rite Aid Corp. *		1,101,900		0.3		8,043,870
United Natural Foods, Inc. *		72,982		0.2		5,037,947
Other Securities				0.7		17,934,533
				1.2		31,016,350
Food, Beverage & Tobacco 2.0%
Darling International, Inc. *		234,700		0.2		4,696,347
The Hain Celestial Group, Inc. *		57,331		0.2		4,931,613
Other Securities				1.6		40,991,955
				2.0		50,619,915
Health Care Equipment & Services 6.5%
Align Technology, Inc. *		108,700		0.2		5,477,393
athenahealth, Inc. *		54,500		0.3		6,738,380
Centene Corp. *		81,592		0.2		5,417,709
HealthSouth Corp.		129,800		0.2		4,496,272
Team Health Holdings, Inc. *		102,300		0.2		4,959,504
Other Securities				5.4		135,661,696
				6.5		162,750,954
Household & Personal Products 0.4%
Other Securities				0.4		11,116,737
Insurance 2.3%
CNO Financial Group, Inc.		334,600		0.2		5,771,850
Other Securities				2.1		52,749,335
				2.3		58,521,185

28 See financial notes

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		% of Net		Value
Security	of Shares		Assets		($)
Materials 4.7%
Axiall Corp.		104,700		0.2		4,879,020
PolyOne Corp.		144,554		0.2		5,416,438
Other Securities				4.3		108,723,908
				4.7		119,019,366
Media 1.3%
Other Securities				1.3		31,849,110
Pharmaceuticals, Biotechnology & Life Sciences 5.9%
InterMune, Inc. *		146,800		0.2		4,709,344
Questcor Pharmaceuticals, Inc.		77,500		0.2		6,368,950
Other Securities				5.5		138,148,107
				5.9		149,226,401
Real Estate 8.3%
American Realty Capital Properties, Inc.		702,700		0.4		9,198,343
Highwoods Properties, Inc.		133,900		0.2		5,402,865
LaSalle Hotel Properties		156,426		0.2		5,174,572
NorthStar Realty Finance Corp.		488,600		0.3		7,827,372
RLJ Lodging Trust		186,300		0.2		4,968,621
Other Securities				7.0		176,317,756
				8.3		208,889,529
Retailing 3.8%
Other Securities				3.8		94,753,881
Semiconductors & Semiconductor Equipment 3.6%
SunEdison, Inc. *		402,400		0.3		7,738,152
Other Securities				3.3		82,159,817
				3.6		89,897,969
Software & Services 8.2%
Aspen Technology, Inc. *		140,300		0.2		6,031,497
CoStar Group, Inc. *		42,675		0.3		6,865,981
PTC, Inc. *		178,800		0.2		6,324,156
The Ultimate Software Group, Inc. *		40,900		0.2		4,892,867
WEX, Inc. *		57,976		0.2		5,563,957
Other Securities				7.1		178,174,819
				8.2		207,853,277
Technology Hardware & Equipment 4.7%
ARRIS Group, Inc. *		172,860		0.2		4,509,917
Belden, Inc.		66,300		0.2		4,893,603
FEI Co.		62,400		0.2		4,962,048
Other Securities				4.1		104,024,308
				4.7		118,389,876
Telecommunication Services 0.7%
Other Securities				0.7		16,710,190
Transportation 1.8%
Spirit Airlines, Inc. *		90,600		0.2		5,149,704
Other Securities				1.6		39,728,947
				1.8		44,878,651
Utilities 3.2%
Cleco Corp.		90,600		0.2		4,761,030
Other Securities				3.0		74,789,397
				3.2		79,550,427
Total Common Stock
(Cost $1,658,448,442)						2,422,381,678
Rights 0.0% of net assets
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
Other Securities				0.0		—
Telecommunication Services 0.0%
Other Securities				0.0		213,444
Total Rights
(Cost $213,444)						213,444
Warrants 0.0% of net assets
Energy 0.0%
Other Securities				0.0		—
Total Warrants
(Cost $—)						—
	Face
Security	Amount		% of Net		Value
Rate, Maturity Date	($)		Assets		($)
Short-Term Investments 3.3% of net assets
Time Deposits 3.1%
DNB
0.03%, 05/01/14		74,674,338		3.0		74,674,338
Other Securities				0.1		3,231,163
				3.1		77,905,501
U.S. Treasury Obligations 0.2%
Other Securities				0.2		3,999,728
Total Short-Term Investments
(Cost $81,905,229)						81,905,229
End of Investments.

See financial notes 29

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		% of Net		Value
Security	of Shares		Assets		($)
Collateral Invested for Securities on Loan 4.9% of net assets
Wells Fargo Advantage Government Money Market Fund, Institutional Class 0.01% (f)		122,988,021		4.9		122,988,021
Total Collateral Invested for Securities on Loan
(Cost $122,988,021)						122,988,021
End of Collateral Invested for Securities on Loan.

At 04/30/14 tax basis cost of the fund’s investments was $1,748,601,497 and the unrealized appreciation and depreciation were $874,737,824 and ($118,838,970), respectively, with a net unrealized appreciation of $755,898,854.

For the following notes, please refer to the complete schedule of portfolio 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 $213,444 or 0.0% of net assets.
(c)	All or a portion of this security is on loan. Securities on loan were valued at $119,586,498.
(d)	All or a portion of this security is held as collateral for open futures contracts.
(e)	The rate shown is the purchase yield.
(f)	The rate shown is the 7-day yield.

CVR —	Contingent Value Rights
REIT —	Real Estate Investment Trust

In addition to the above, the fund held the following at 04/30/14:

			Contract		Unrealized
	Number of		Value		Depreciation
	Contracts		($)		($)
Futures Contracts
Russell 2000 Index, mini, Long, expires 06/20/14		810		91,011,600		(2,559,487	)

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2014 (see financial note 2(a) for additional information):

Assets Valuation Input

	Quoted Prices in					Significant
	Active Markets for			Other Significant		Unobservable
	Identical Assets			Observable Inputs		Inputs
Description	(Level 1)			(Level 2)		(Level 3)		Total
Common Stock1		$2,422,381,678			$—		$—		$2,422,381,678
Rights1		—			—		213,444		213,444
Warrants1		—			—		—		—
Short-Term Investments1		—			81,905,229		—		81,905,229
Total		$2,422,381,678			$81,905,229		$213,444		$2,504,500,351
Other Financial Instruments
Collateral Invested for Securities on Loan		$122,988,021			$—		$—		$122,988,021
Liabilities Valuation Input
Other Financial Instruments
Futures Contracts2		($2,559,487	)		$—		$—		($2,559,487	)

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

30 See financial notes

 Schwab Small-Cap 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		Appreciation		Gross		Gross		Transfers		Transfers		April 30,
Investments in Securities	2013		(Losses)		(Depreciation)		Purchases		Sales		in		out		2014
Rights		$—		$—		$—		$213,444		$—		$—		$—		$213,444
Total		$—		$—		$—		$213,444		$—		$—		$—		$213,444

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, 2014.

See financial notes 31

 Schwab Small-Cap Index Fund

Statement of

Assets and Liabilities

As of April 30, 2014; unaudited

Assets
Investments, at value (cost $1,740,567,115) including securities on loan of $119,586,498		$2,504,500,351
Collateral invested for securities on loan		122,988,021
Receivables:
Investments sold		1,868,075
Fund shares sold		16,602,357
Dividends		975,401
Variation margin on futures contracts		504,799
Income from securities on loan		344,957
Receivable from investment adviser		623
Interest		65
Prepaid expenses	+	23,571
Total assets		2,647,808,220
Liabilities
Collateral held for securities on loan		122,988,021
Payables:
Investments bought		5,851,560
Investment adviser and administrator fees		23,550
Shareholder service fees		5,048
Fund shares redeemed		929,451
Accrued expenses	+	168,269
Total liabilities		129,965,899
Net Assets
Total assets		2,647,808,220
Total liabilities	−	129,965,899
Net assets		$2,517,842,321
Net Assets by Source
Capital received from investors		1,725,990,449
Net investment income not yet distributed		9,379,527
Net realized capital gains		21,098,570
Net unrealized capital appreciation		761,373,775
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$2,517,842,321		93,884,820			$26.82

32 See financial notes

 Schwab Small-Cap Index Fund

Statement of

Operations

For the period November 1, 2013 through April 30, 2014; unaudited

Investment Income
Dividends (net of foreign withholding taxes of $9,035)		$17,587,064
Interest		12,510
Securities on loan	+	2,100,839
Total investment income		19,700,413
Expenses
Investment adviser and administrator fees		1,847,629
Shareholder service fees		239,778
Index fee		159,276
Shareholder reports		67,648
Portfolio accounting fees		52,030
Registration fees		30,519
Transfer agent fees		29,877
Professional fees		22,770
Custodian fees		22,578
Independent trustees’ fees		9,012
Other expenses	+	22,931
Total expenses		2,504,048
Expense reduction by CSIM and its affiliates	−	410,068
Net expenses	−	2,093,980
Net investment income		17,606,433
Realized and Unrealized Gains (Losses)
Net realized gains on investments		24,787,656
Net realized gains on futures contracts		7,401,687
Net realized losses on foreign currency transactions	+	(202	)
Net realized gains		32,189,141
Net change in unrealized appreciation (depreciation) on investments		26,089,836
Net change in unrealized appreciation (depreciation) on futures contracts		(5,714,948	)
Net change in unrealized appreciation (depreciation) on foreign currency translations	+	17
Net change in unrealized appreciation (depreciation)	+	20,374,905
Net realized and unrealized gains		52,564,046
Increase in net assets resulting from operations		$70,170,479

See financial notes 33

 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

11/1/13-4/30/14				11/1/12-10/31/13
Net investment income		$17,606,433			$35,040,608
Net realized gains		32,189,141			103,525,565
Net change in unrealized appreciation (depreciation)	+	20,374,905			474,902,335
Increase in net assets from operations		70,170,479			613,468,508
Distributions to Shareholders
Distributions from net investment income		(26,168,327	)		(39,112,389	)
Distributions from net realized gains	+	(110,361,333	)		(39,238,431	)
Total distributions		($136,529,660	)		($78,350,820	)

Transactions in Fund Shares

		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		VALUE			SHARES		VALUE
Shares sold			10,108,822		$277,418,798			17,519,506		$419,420,964
Shares reinvested			4,440,568		116,032,036			3,540,194		72,432,373
Shares redeemed	+		(5,810,211	)	(160,602,496	)		(14,685,439	)	(350,359,363	)
Net transactions in fund shares			8,739,179		$232,848,338			6,374,261		$141,493,974
Shares Outstanding and Net Assets
		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			85,145,641		$2,351,353,164			78,771,380		$1,674,741,502
Total increase	+		8,739,179		166,489,157			6,374,261		676,611,662
End of period			93,884,820		$2,517,842,321			85,145,641		$2,351,353,164
Net investment income not yet distributed					$9,379,527					$17,941,421

34 See financial notes

Schwab Total Stock Market Index Fund^®

Financial Statements

Financial Highlights

	11/1/13–			11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–
	4/30/14*			10/31/13			10/31/12			10/31/11			10/31/10			10/31/091
Per-Share Data ($)
Net asset value at beginning of period		32.53			25.80			22.92			21.57			18.50			17.08
Income (loss) from investment operations:
Net investment income (loss)		0.30			0.57			0.47			0.41			0.37			0.24
Net realized and unrealized gains (losses)		2.19			6.70			2.83			1.33			3.02			1.55
Total from investment operations		2.49			7.27			3.30			1.74			3.39			1.79
Less distributions:
Distributions from net investment income		(0.51	)		(0.54	)		(0.42	)		(0.39	)		(0.32	)		(0.37	)
Distributions from net realized gains		(0.15	)		—			—			—			—			—
Total distributions		(0.66	)		(0.54	)		(0.42	)		(0.39	)		(0.32	)		(0.37	)
Net asset value at end of period		34.36			32.53			25.80			22.92			21.57			18.50
Total return (%)		7.77	2		28.76			14.71			8.14			18.53			10.92
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		0.09	3		0.09			0.09			0.09			0.09			0.21	4
Gross operating expenses		0.10	3		0.10			0.10			0.11			0.11			0.28
Net investment income (loss)		1.85	3		2.02			2.02			1.79			1.85			2.02
Portfolio turnover rate		0	2,5		2			3			1			3			5
Net assets, end of period ($ x 1,000,000)		3,631			3,183			2,240			1,747			1,470			1,205

* 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.

⁵ Less than 1%.

See financial notes 35

 Schwab Total Stock Market Index Fund

Portfolio Holdings as of April 30, 2014 (Unaudited)

This section shows the fund’s 50 largest portfolio holdings in unaffiliated issuers, and any holdings exceeding 1% of the fund’s 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		2,186,360,928		3,522,081,897
	0	.0%	Rights		32,982		32,760
	0	.0%	Warrants		—		—
	2	.8%	Short-Term Investments		101,893,219		101,893,219
	99	.8%	Total Investments		2,288,287,129		3,624,007,876
	0	.7%	Collateral Invested for Securities on Loan		26,681,531		26,681,531
	(0	.5%)	Other Assets and Liabilities, Net				(19,603,489	)
	100	.0%	Net Assets				3,631,085,918

	Number		% of Net		Value
Security	of Shares		Assets		($)
Common Stock 97.0% of net assets
Automobiles & Components 1.2%
Other Securities				1.2		45,014,329
Banks 5.8%
Bank of America Corp.		1,783,756		0.7		27,006,066
Citigroup, Inc.		512,528		0.7		24,555,216
JPMorgan Chase & Co.		639,144		1.0		35,779,281
Wells Fargo & Co.		808,206		1.1		40,119,346
Other Securities				2.3		83,037,153
				5.8		210,497,062
Capital Goods 8.2%
3M Co.		105,600		0.4		14,687,904
General Electric Co.		1,693,466		1.2		45,537,301
The Boeing Co.		115,500		0.4		14,901,810
United Technologies Corp.		142,168		0.5		16,822,739
Other Securities				5.7		205,907,882
				8.2		297,857,636
Commercial & Professional Supplies 1.0%
Other Securities				1.0		37,447,254
Consumer Durables & Apparel 1.5%
Other Securities				1.5		54,963,788
Consumer Services 2.1%
McDonald’s Corp.		167,109		0.5		16,941,510
Other Securities				1.6		59,608,341
				2.1		76,549,851
Diversified Financials 4.4%
American Express Co.		154,250		0.4		13,486,077
Berkshire Hathaway, Inc., Class B *		303,874		1.1		39,154,165
The Charles Schwab Corp. (a)		197,326		0.1		5,239,005
Other Securities				2.8		100,772,860
				4.4		158,652,107
Energy 9.6%
Chevron Corp.		322,239		1.1		40,447,439
ConocoPhillips		206,923		0.4		15,376,448
Exxon Mobil Corp.		729,434		2.1		74,701,336
Occidental Petroleum Corp.		134,720		0.4		12,899,440
Schlumberger Ltd.		220,660		0.6		22,408,023
Other Securities				5.0		182,252,011
				9.6		348,084,697
Food & Staples Retailing 2.0%
CVS Caremark Corp.		199,590		0.4		14,514,185
Wal-Mart Stores, Inc.		273,100		0.6		21,768,801
Other Securities				1.0		34,814,260
				2.0		71,097,246
Food, Beverage & Tobacco 4.4%
Altria Group, Inc.		336,400		0.4		13,493,004
PepsiCo, Inc.		256,958		0.6		22,070,123
Philip Morris International, Inc.		267,600		0.6		22,861,068
The Coca-Cola Co.		639,600		0.7		26,089,284
Other Securities				2.1		76,350,238
				4.4		160,863,717
Health Care Equipment & Services 4.2%
Other Securities				4.2		153,676,884
Household & Personal Products 1.9%
The Procter & Gamble Co.		457,615		1.1		37,776,118
Other Securities				0.8		29,550,652
				1.9		67,326,770
Insurance 3.1%
American International Group, Inc.		247,096		0.4		13,128,210
Other Securities				2.7		97,818,854
				3.1		110,947,064
Materials 3.8%
Other Securities				3.8		137,520,303

36 See financial notes

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		% of Net		Value
Security	of Shares		Assets		($)
Media 3.3%
Comcast Corp., Class A		440,004		0.6		22,774,607
The Walt Disney Co.		274,993		0.6		21,817,945
Other Securities				2.1		76,127,422
				3.3		120,719,974
Pharmaceuticals, Biotechnology & Life Sciences 8.2%
AbbVie, Inc.		268,105		0.4		13,962,908
Amgen, Inc.		127,468		0.4		14,244,549
Bristol-Myers Squibb Co.		277,550		0.4		13,902,480
Gilead Sciences, Inc. *		259,680		0.6		20,382,283
Johnson & Johnson		477,470		1.3		48,362,936
Merck & Co., Inc.		496,370		0.8		29,067,427
Pfizer, Inc.		1,077,401		0.9		33,701,103
Other Securities				3.4		123,900,754
				8.2		297,524,440
Real Estate 3.6%
Other Securities				3.6		130,037,439
Retailing 4.0%
Amazon.com, Inc. *		62,800		0.5		19,099,364
The Home Depot, Inc.		237,670		0.5		18,897,142
Other Securities				3.0		107,525,330
				4.0		145,521,836
Semiconductors & Semiconductor Equipment 2.2%
Intel Corp.		839,232		0.6		22,399,102
Other Securities				1.6		58,042,196
				2.2		80,441,298
Software & Services 9.4%
Facebook, Inc., Class A *		288,400		0.5		17,240,552
Google, Inc., Class A *		47,665		0.7		25,495,055
Google, Inc., Class C *		47,665		0.7		25,103,249
International Business Machines Corp.		165,210		0.9		32,458,809
Microsoft Corp.		1,274,950		1.4		51,507,980
Oracle Corp.		584,549		0.6		23,896,363
Visa, Inc., Class A		85,600		0.5		17,343,416
Other Securities				4.1		148,966,618
				9.4		342,012,042
Technology Hardware & Equipment 5.8%
Apple, Inc.		150,600		2.5		88,867,554
Cisco Systems, Inc.		869,509		0.6		20,094,353
QUALCOMM, Inc.		285,400		0.6		22,463,834
Other Securities				2.1		77,822,226
				5.8		209,247,967
Telecommunication Services 2.2%
AT&T, Inc.		878,856		0.9		31,375,159
Verizon Communications, Inc.		698,972		0.9		32,662,962
Other Securities				0.4		14,112,541
				2.2		78,150,662
Transportation 2.0%
Union Pacific Corp.		76,900		0.4		14,644,067
Other Securities				1.6		59,828,568
				2.0		74,472,635
Utilities 3.1%
Other Securities				3.1		113,454,896
Total Common Stock
(Cost $2,186,360,928)						3,522,081,897
Rights 0.0% of net assets
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
Other Securities				0.0		—
Technology Hardware & Equipment 0.0%
Other Securities				0.0		—
Telecommunication Services 0.0%
Other Securities				0.0		32,760
Total Rights
(Cost $32,982)						32,760
Warrants 0.0% of net assets
Energy 0.0%
Other Securities				0.0		—
Total Warrants
(Cost $—)						—
	Face
Security	Amount		% of Net		Value
Rate, Maturity Date	($)		Assets		($)
Short-Term Investments 2.8% of net assets
Time Deposit 2.6%
Australia & New Zealand Banking Group Ltd.
0.03%, 05/01/14		95,893,627		2.6		95,893,627
U.S. Treasury Obligation 0.2%
Other Securities				0.2		5,999,592
Total Short-Term Investments
(Cost $101,893,219)						101,893,219
End of Investments.

See financial notes 37

 Schwab Total Stock Market 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, Institutional Class 0.01% (f)		26,681,531		0.7		26,681,531
Total Collateral Invested for Securities on Loan
(Cost $26,681,531)						26,681,531
End of Collateral Invested for Securities on Loan.

At 04/30/14 tax basis cost of the fund’s investments was $2,302,453,550 and the unrealized appreciation and depreciation were $1,391,997,727 and ($70,443,401), respectively, with a net unrealized appreciation of $1,321,554,326.

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

*	Non-income producing security.
(a)	Issuer is affiliated with the fund’s adviser.
(b)	Illiquid security. At the period end, the value of these amounted to $32,760 or 0.0% of net assets.
(c)	All or a portion of this security is on loan. Securities on loan were valued at $26,212,591.
(d)	All or a portion of this security is held as collateral for open futures contracts.
(e)	The rate shown is the purchase yield.
(f)	The rate shown is the 7-day yield.
(g)	Fair-valued by management in accordance with procedures approved by the Board of Trustees.

CVR —	Contingent Value Rights
REIT —	Real Estate Investment Trust

In addition to the above, the fund held the following at 04/30/14:

					Unrealized
			Contract		Appreciation
	Number of		Value		(Depreciation)
	Contracts		($)		($)
Futures Contracts
Russell 2000 Index, mini, Long, expires 06/20/14		140		15,730,400		(387,687	)
S&P 500 Index, e-mini, Long, expires 06/20/14		960		90,139,200		1,414,538
Net Unrealized Appreciation						1,026,851

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2014 (see financial note 2(a) for additional information):

Assets Valuation Input

	Quoted Prices in					Significant
	Active Markets for			Other Significant		Unobservable
	Identical Assets			Observable Inputs		Inputs
Description	(Level 1)			(Level 2)		(Level 3)		Total
Common Stock1		$3,522,081,897			$—		$—		$3,522,081,897
Rights1		—			—		32,760		32,760
Warrants1		—			—		—		—
Short-Term Investments1		—			101,893,219		—		101,893,219
Total		$3,522,081,897			$101,893,219		$32,760		$3,624,007,876
Other Financial Instruments
Collateral Invested for Securities on Loan		$26,681,531			$—		$—		$26,681,531
Futures Contracts2		1,414,538			—		—		1,414,538
Liabilities Valuation Input
Other Financial Instruments
Futures Contracts2		($387,687	)		$—		$—		($387,687	)

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

38 See financial notes

 Schwab Total Stock Market 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		Appreciation		Gross		Gross		Transfers		Transfers		April 30,
Investments in Securities	2013		(Losses)		(Depreciation)		Purchases		Sales		in		out		2014
Rights		$—		$—		$—		$32,760		$—		$—		$—		$32,760
Total		$—		$—		$—		$32,760		$—		$—		$—		$32,760

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, 2014.

See financial notes 39

 Schwab Total Stock Market Index Fund

Statement of

Assets and Liabilities

As of April 30, 2014; unaudited

Assets
Investments in affiliated issuers, at value (cost $3,791,179)		$5,239,005
Investments in unaffiliated issuers, at value (cost $2,284,495,950) including securities on loan of $26,212,591	+	3,618,768,871
Total investments, at value (cost $2,288,287,129)		3,624,007,876
Collateral invested for securities on loan		26,681,531
Receivables:
Investments sold		2,731,383
Fund shares sold		4,014,474
Dividends		2,868,059
Variation margin on futures contracts		369,725
Income from securities on loan		66,654
Interest		80
Prepaid expenses	+	25,664
Total assets		3,660,765,446
Liabilities
Collateral held for securities on loan		26,681,531
Payables:
Investment adviser and administrator fees		17,157
Shareholder service fees		7,754
Fund shares redeemed		2,901,999
Accrued expenses	+	71,087
Total liabilities		29,679,528
Net Assets
Total assets		3,660,765,446
Total liabilities	−	29,679,528
Net assets		$3,631,085,918
Net Assets by Source
Capital received from investors		2,275,969,005
Net investment income not yet distributed		20,811,481
Net realized capital losses		(2,442,166	)
Net unrealized capital appreciation		1,336,747,598
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$3,631,085,918		105,672,883			$34.36

40 See financial notes

 Schwab Total Stock Market Index Fund

Statement of

Operations

For the period November 1, 2013 through April 30, 2014; unaudited

Investment Income
Dividends received from affiliated issuer		$22,437
Dividends received from unaffiliated issuers (net of foreign withholding taxes of $919)		32,563,922
Interest		13,479
Securities on loan	+	363,101
Total investment income		32,962,939
Expenses
Investment adviser and administrator fees		1,018,417
Shareholder service fees		327,012
Portfolio accounting fees		62,909
Shareholder reports		46,966
Transfer agent fees		43,940
Registration fees		40,239
Custodian fees		33,159
Professional fees		24,789
Independent trustees’ fees		11,121
Other expenses	+	30,671
Total expenses		1,639,223
Expense reduction by CSIM and its affiliates	−	111,598
Net expenses	−	1,527,625
Net investment income		31,435,314
Realized and Unrealized Gains (Losses)
Net realized gains on unaffiliated investments		6,681,513
Net realized gains on futures contracts	+	7,664,313
Net realized gains		14,345,826
Net change in unrealized appreciation (depreciation) on affiliated issuer		703,130
Net change in unrealized appreciation (depreciation) on unaffiliated investments		207,471,017
Net change in unrealized appreciation (depreciation) on futures contracts	+	(1,581,686	)
Net change in unrealized appreciation (depreciation)	+	206,592,461
Net realized and unrealized gains		220,938,287
Increase in net assets resulting from operations		$252,373,601

See financial notes 41

 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

11/1/13-4/30/14				11/1/12-10/31/13
Net investment income		$31,435,314			$54,198,628
Net realized gains		14,345,826			18,230,467
Net change in unrealized appreciation (depreciation)	+	206,592,461			606,599,386
Increase in net assets from operations		252,373,601			679,028,481
Distributions to Shareholders
Distributions from net investment income		(50,022,427	)		(47,503,974	)
Distributions from net realized gains	+	(14,754,888	)		—
Total distributions		($64,777,315	)		($47,503,974	)

Transactions in Fund Shares

		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		VALUE			SHARES		VALUE
Shares sold			14,017,321		$468,560,747			26,862,706		$768,188,272
Shares reinvested			1,242,275		40,088,226			1,519,219		38,800,859
Shares redeemed	+		(7,446,363	)	(248,546,232	)		(17,343,333	)	(494,804,875	)
Net transactions in fund shares			7,813,233		$260,102,741			11,038,592		$312,184,256
Shares Outstanding and Net Assets
		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			97,859,650		$3,183,386,891			86,821,058		$2,239,678,128
Total increase	+		7,813,233		447,699,027			11,038,592		943,708,763
End of period			105,672,883		$3,631,085,918			97,859,650		$3,183,386,891
Net investment income not yet distributed					$20,811,481					$39,398,594

42 See financial notes

Schwab International Index Fund^®

Financial Statements

Financial Highlights

	11/1/13–			11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–
	4/30/14*			10/31/13			10/31/12			10/31/11			10/31/10			10/31/091
Per-Share Data ($)
Net asset value at beginning of period		19.92			16.32			16.02			17.31			16.26			13.95
Income (loss) from investment operations:
Net investment income (loss)		0.39			0.49			0.57			0.57			0.48			0.37
Net realized and unrealized gains (losses)		0.52			3.69			0.33			(1.38	)		1.01			2.58
Total from investment operations		0.91			4.18			0.90			(0.81	)		1.49			2.95
Less distributions:
Distributions from net investment income		(0.51	)		(0.58	)		(0.60	)		(0.48	)		(0.44	)		(0.64	)
Net asset value at end of period		20.32			19.92			16.32			16.02			17.31			16.26
Total return (%)		4.73	2		26.40			6.07			(4.83	)		9.31			22.55
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		0.19	3		0.19			0.19			0.19			0.19			0.32	4
Gross operating expenses		0.22	3		0.23			0.23			0.21			0.22			0.41
Net investment income (loss)		4.08	3		2.88			3.66			3.26			2.88			2.92
Portfolio turnover rate		1	2		5			31	5		10			13			21
Net assets, end of period ($ x 1,000,000)		2,499			2,205			1,415			1,375			1,471			1,369

* 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 43

 Schwab International Index Fund

Portfolio Holdings as of April 30, 2014 (Unaudited)

This section shows the fund’s 50 largest portfolio holdings in unaffiliated issuers, and any holdings exceeding 1% of the fund’s 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	.8%	Common Stock		1,795,245,659		2,420,335,392
	0	.6%	Preferred Stock		9,585,888		15,506,942
	0	.0%	Rights		429,850		617,551
	0	.0%	Warrants		—		15,968
	0	.4%	Other Investment Company		8,089,400		9,564,800
	1	.8%	Short-Term Investments		43,356,422		43,356,422
	99	.6%	Total Investments		1,856,707,219		2,489,397,075
	1	.6%	Collateral Invested for Securities on Loan		39,582,384		39,582,384
	(1	.2%)	Other Assets and Liabilities, Net				(29,524,528	)
	100	.0%	Net Assets				2,499,454,931

	Number		% of Net		Value
Security	of Shares		Assets		($)
Common Stock 96.8% of net assets
Australia 7.8%
Australia & New Zealand Banking Group Ltd.		499,603		0.7		16,066,120
BHP Billiton Ltd.		584,822		0.8		20,595,440
Commonwealth Bank of Australia		293,519		0.9		21,591,519
National Australia Bank Ltd.		427,816		0.6		14,086,858
Westpac Banking Corp.		566,132		0.7		18,543,378
Other Securities				4.1		103,263,396
				7.8		194,146,711
Austria 0.3%
Other Securities				0.3		6,602,869
Belgium 1.2%
Anheuser-Busch InBev N.V.		146,333		0.6		15,949,688
Other Securities				0.6		13,912,924
				1.2		29,862,612
Denmark 1.3%
Novo Nordisk A/S, Class B		362,601		0.7		16,457,003
Other Securities				0.6		16,278,357
				1.3		32,735,360
Finland 0.9%
Other Securities				0.9		21,463,336
France 10.2%
BNP Paribas S.A.		181,285		0.5		13,622,564
Sanofi		217,578		0.9		23,480,983
Total S.A.		389,505		1.1		27,866,807
Other Securities				7.7		191,155,264
				10.2		256,125,618
Germany 8.6%
Allianz SE - Reg’d		83,125		0.6		14,466,231
BASF SE		167,247		0.8		19,401,607
Bayer AG - Reg’d		150,580		0.8		20,936,895
Daimler AG - Reg’d		175,310		0.7		16,321,207
SAP AG		167,775		0.5		13,560,752
Siemens AG - Reg’d		144,381		0.8		19,046,775
Other Securities				4.4		110,291,414
				8.6		214,024,881
Hong Kong 2.7%
AIA Group Ltd.		2,193,200		0.4		10,666,833
Other Securities				2.3		57,271,881
				2.7		67,938,714
Ireland 0.3%
Other Securities				0.3		7,957,135
Israel 0.5%
Other Securities				0.5		12,246,563
Italy 2.6%
Eni S.p.A.		463,229		0.5		11,997,314
Other Securities				2.1		52,523,575
				2.6		64,520,889
Japan 18.5%
Honda Motor Co., Ltd.		296,839		0.4		9,850,503
Mitsubishi UFJ Financial Group, Inc.		2,321,209		0.5		12,347,657
SoftBank Corp.		174,900		0.5		13,026,201
Toyota Motor Corp.		502,303		1.1		27,138,502
Other Securities				16.0		400,064,693
				18.5		462,427,556
Netherlands 2.6%
ING Groep N.V. CVA *		699,136		0.4		9,994,047
Unilever N.V. CVA		296,626		0.5		12,719,650
Other Securities				1.7		42,102,562
				2.6		64,816,259

44 See financial notes

 Schwab International Index Fund

Portfolio Holdings (Unaudited) continued

	Number		% of Net		Value
Security	of Shares		Assets		($)
New Zealand 0.1%
Other Securities				0.1		3,286,806
Norway 0.8%
Other Securities				0.8		20,747,711
Portugal 0.2%
Other Securities				0.2		4,712,809
Singapore 1.4%
Other Securities				1.4		36,148,396
Spain 3.5%
Banco Bilbao Vizcaya Argentaria S.A.		1,074,233		0.5		13,232,117
Banco Santander S.A.		2,156,646		0.9		21,449,283
Telefonica S.A.		745,834		0.5		12,516,669
Other Securities				1.6		40,395,618
				3.5		87,593,687
Sweden 3.2%
Other Securities				3.2		79,192,016
Switzerland 9.0%
Cie Financiere Richemont S.A.		95,052		0.4		9,670,591
Nestle S.A. - Reg’d		587,209		1.8		45,382,016
Novartis AG - Reg’d		418,859		1.5		36,412,459
Roche Holding AG		127,931		1.5		37,528,058
UBS AG - Reg’d *		664,575		0.5		13,898,831
Other Securities				3.3		83,065,479
				9.0		225,957,434
United Kingdom 21.1%
AstraZeneca plc		228,601		0.7		18,044,527
Barclays plc		2,785,700		0.5		11,895,058
BG Group plc		620,762		0.5		12,557,585
BHP Billiton plc		384,591		0.5		12,485,505
BP plc		3,395,901		1.1		28,671,972
British American Tobacco plc		343,981		0.8		19,863,158
Diageo plc		457,073		0.6		14,004,623
GlaxoSmithKline plc		885,286		1.0		24,460,922
Glencore Xstrata plc		1,932,125		0.4		10,425,291
HSBC Holdings plc		3,413,951		1.4		34,882,423
Lloyds Banking Group plc *		9,096,859		0.5		11,600,428
Prudential plc		466,031		0.4		10,713,636
Rio Tinto plc		231,511		0.5		12,586,716
Royal Dutch Shell plc, A Shares		702,997		1.1		27,792,423
Royal Dutch Shell plc, B Shares		451,454		0.8		19,169,183
Unilever plc		233,707		0.4		10,454,428
Vodafone Group plc		4,813,579		0.7		18,275,268
Other Securities				9.2		229,944,884
				21.1		527,828,030
Total Common Stock
(Cost $1,795,245,659)						2,420,335,392
Preferred Stock 0.6% of net assets
Germany 0.6%
Other Securities				0.6		15,429,254
United Kingdom 0.0%
Other Securities				0.0		77,688
Total Preferred Stock
(Cost $9,585,888)						15,506,942
Rights 0.0% of net assets
Australia 0.0%
Other Securities				0.0		8,631
Spain 0.0%
Other Securities				0.0		439,614
United Kingdom 0.0%
Other Securities				0.0		169,306
Total Rights
(Cost $429,850)						617,551
Warrants 0.0% of net assets
Hong Kong 0.0%
Other Securities				0.0		15,968
Total Warrants
(Cost $—)						15,968
Other Investment Company 0.4% of net assets
United States 0.4%
Other Securities				0.4		9,564,800
Total Other Investment Company
(Cost $8,089,400)						9,564,800
	Face
Security	Amount		% of Net		Value
Rate, Maturity Date	($)		Assets		($)
Short-Term Investments 1.8% of net assets
Time Deposits 1.6%
DNB
0.03%, 05/01/14		37,460,427		1.5		37,460,427
Other Securities				0.1		1,796,269
				1.6		39,256,696

See financial notes 45

 Schwab International Index Fund

Portfolio Holdings (Unaudited) continued

	Face
Security	Amount		% of Net		Value
Rate, Maturity Date	($)		Assets		($)
U.S. Treasury Obligation 0.2%
Other Securities				0.2		4,099,726
Total Short-Term Investments
(Cost $43,356,422)						43,356,422
End of Investments.
	Number		% of Net		Value
Security	of Shares		Assets		($)
Collateral Invested for Securities on Loan 1.6% of net assets
Wells Fargo Advantage Government Money Market Fund, Institutional Class 0.01% (f)		39,582,384		1.6		39,582,384
Total Collateral Invested for Securities on Loan
(Cost $39,582,384)						39,582,384
End of Collateral Invested for Securities on Loan.

At 04/30/14, the tax basis cost of the fund’s investments was $1,865,329,188 and the unrealized appreciation and depreciation were $724,768,165 and ($100,700,278), respectively, with a net unrealized appreciation of $624,067,887.

At 04/30/14, the values of certain foreign securities held by the fund aggregating $2,410,064,032 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(a) for additional information)

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

*	Non-income producing security.
(a)	All or a portion of this security is on loan. Securities on loan were valued at $37,263,952.
(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 $541,901 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.
(f)	The rate shown is the 7-day yield.

ADR —	American Depositary Receipt
CDI —	CHESS Depositary Interest
CVA —	Dutch Certificate
ETF —	Exchange traded fund
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 04/30/14:

			Contract		Unrealized
	Number of		Value		Appreciation
	Contracts		($)		($)
Futures Contracts
MSCI EAFE, e-mini, Long, expires 06/20/14		410		39,448,150		1,294,344

46 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, 2014 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Other Significant		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Common Stock1		$—		$750,128,722		$—		$750,128,722
Australia		391,933		192,005,698		1,749,080		194,146,711
Austria		612,967		5,989,902		—		6,602,869
Belgium		551,565		29,311,047		—		29,862,612
Denmark		1,371,835		31,363,525		—		32,735,360
Finland		1,176,348		20,286,988		—		21,463,336
France		4,923,878		251,201,740		—		256,125,618
Germany		527,512		213,497,369		—		214,024,881
Hong Kong		994,572		66,944,142		—		67,938,714
Ireland		2,153,251		5,803,884		—		7,957,135
Netherlands		706,051		64,110,208		—		64,816,259
Norway		647,168		20,100,543		—		20,747,711
Switzerland		2,544,424		223,413,010		—		225,957,434
United Kingdom		7,350,030		520,478,000		—		527,828,030
Preferred Stock1		—		15,429,254		—		15,429,254
United Kingdom		—		—		77,688		77,688
Rights
Australia		—		—		8,631		8,631
Spain		—		—		439,614		439,614
United Kingdom		169,306		—		—		169,306
Warrants1		15,968		—		—		15,968
Other Investment Company1		9,564,800		—		—		9,564,800
Short-Term Investments1		—		43,356,422		—		43,356,422
Total		$33,701,608		$2,453,420,454		$2,275,013		$2,489,397,075
Other Financial Instruments
Collateral Invested for Securities on Loan		$39,582,384		$—		$—		$39,582,384
Futures Contracts2		1,294,344		—		—		1,294,344

1	As categorized in the complete schedule of portfolio holdings.
2	Futures contracts are not included in Investments in the schedule of portfolio holdings 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		Appreciation			Gross		Gross			Transfers		Transfers		April 30,
Investments in Securities	2013		(Losses)		(Depreciation)			Purchases		Sales			in		out		2014
Common Stock
Australia		$—		$—		$15,721			$233,905		$—			$1,499,454		$—		$1,749,080
Preferred Stock
United Kingdom		41,914		460		837			77,200		(42,723	)		—		—		77,688
Rights
Australia		—		—		8,631			—		—			—		—		8,631
Spain		389,200		—		(7,788	)		429,850		(371,648	)		—		—		439,614
Total		$431,114		$460		$17,401			$740,955		($414,371	)		$1,499,454		$—		$2,275,013

See financial notes 47

 Schwab International Index Fund

Portfolio Holdings (Unaudited) continued

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 appreciation (depreciation) for Level 3 investments held by the fund at April 30, 2014 was $30,657.

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, 2014. The transfers in the amount of $12,437,479 and $11,946,901 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 or out of Level 3 from Level 1 or Level 2 were the result of fair valued securities for which no quoted value was available.

48 See financial notes

 Schwab International Index Fund

Statement of

Assets and Liabilities

As of April 30, 2014; unaudited

Assets
Investments, at value (cost $1,856,707,219) including securities on loan of $37,263,952		$2,489,397,075
Foreign currency, at value (cost $285)		304
Collateral invested for securities on loan		39,582,384
Receivables:
Investments sold		152,638
Dividends		9,257,079
Fund shares sold		5,749,417
Foreign tax reclaims		2,049,845
Income from securities on loan		306,632
Variation margin on futures contracts		153,525
Interest		31
Prepaid expenses	+	23,450
Total assets		2,546,672,380
Liabilities
Collateral held for securities on loan		39,582,384
Payables:
Investment adviser and administrator fees		23,506
Shareholder service fees		5,349
Fund shares redeemed		7,483,642
Accrued expenses	+	122,568
Total liabilities		47,217,449
Net Assets
Total assets		2,546,672,380
Total liabilities	−	47,217,449
Net assets		$2,499,454,931
Net Assets by Source
Capital received from investors		1,863,881,846
Net investment income not yet distributed		25,470,280
Net realized capital losses		(23,973,126	)
Net unrealized capital appreciation		634,075,931
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$2,499,454,931		123,026,091			$20.32

See financial notes 49

 Schwab International Index Fund

Statement of

Operations

For the period November 1, 2013 through April 30, 2014; unaudited

Investment Income
Dividends (net of foreign withholding taxes of $3,609,985)		$48,676,615
Interest		11,616
Securities on loan	+	541,478
Total investment income		49,229,709
Expenses
Investment adviser and administrator fees		1,728,380
Shareholder service fees		225,057
Custodian fees		210,614
Index fee		192,465
Portfolio accounting fees		57,741
Registration fees		40,221
Shareholder reports		39,794
Transfer agent fees		30,518
Professional fees		26,969
Independent trustees’ fees		8,563
Interest expense		1,680
Other expenses	+	29,955
Total expenses		2,591,957
Expense reduction by CSIM and its affiliates	−	400,995
Net expenses	−	2,190,962
Net investment income		47,038,747
Realized and Unrealized Gains (Losses)
Net realized gains on investments		293,859
Net realized gains on futures contracts		4,407,303
Net realized losses on foreign currency transactions	+	(37,762	)
Net realized gains		4,663,400
Net change in unrealized appreciation (depreciation) on investments		60,029,367
Net change in unrealized appreciation (depreciation) on futures contracts		(1,123,492	)
Net change in unrealized appreciation (depreciation) on foreign currency translations	+	29,329
Net change in unrealized appreciation (depreciation)	+	58,935,204
Net realized and unrealized gains		63,598,604
Increase in net assets resulting from operations		$110,637,351

50 See financial notes

 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

11/1/13-4/30/14				11/1/12-10/31/13
Net investment income		$47,038,747			$50,514,341
Net realized gains		4,663,400			6,801,009
Net change in unrealized appreciation (depreciation)	+	58,935,204			355,342,477
Increase in net assets from operations		110,637,351			412,657,827
Distributions to Shareholders
Distributions from net investment income		($56,954,638	)		($50,551,708	)

Transactions in Fund Shares

		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		VALUE			SHARES		VALUE
Shares sold			17,267,103		$340,238,495			36,208,819		$648,488,445
Shares reinvested			2,382,491		45,076,723			2,784,477		45,581,882
Shares redeemed	+		(7,283,521	)	(144,205,816	)		(15,012,168	)	(266,487,088	)
Net transactions in fund shares			12,366,073		$241,109,402			23,981,128		$427,583,239
Shares Outstanding and Net Assets
		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			110,660,018		$2,204,662,816			86,678,890		$1,414,973,458
Total increase	+		12,366,073		294,792,115			23,981,128		789,689,358
End of period			123,026,091		$2,499,454,931			110,660,018		$2,204,662,816
Net investment income not yet distributed					$25,470,280					$35,386,171

See financial notes 51

 Schwab Equity Index Funds

Financial Notes, unaudited

1. Business Structure of the Funds:

Each of the funds 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	Schwab Total Bond Market Fund
Schwab International Core Equity Fund	Schwab GNMA Fund
Schwab Target 2010 Fund	Schwab Treasury Inflation Protected Securities Index Fund
Schwab Target 2015 Fund	Schwab Tax-Free Bond Fund
Schwab Target 2020 Fund	Schwab California Tax-Free Bond Fund
Schwab Target 2025 Fund	Schwab Global Real Estate Fund
Schwab Target 2030 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 a 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 U.S. Securities and 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:

•  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

52 

 Schwab Equity Index Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

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 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 NAV 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 Contracts (“futures”): Futures are valued at their settlement prices as of the close of their exchanges.

•  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 NAVs. Exchange traded 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, ETFs and futures contracts. Investments in mutual funds are valued daily at their NAVs, and investments in ETFs are valued daily at the last reported sale price or the official closing price, 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

53

 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, 2014 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 a 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 appreciation or depreciation 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 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 appreciation or depreciation 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 be maintained on a daily marked-to-market basis in an amount at least equal to the current value of the securities loaned. The lending agent provides a fund with indemnification against borrower default (the borrower fails to return the security on loan) reducing the risk of loss as a result of default. The cash collateral of securities loaned is currently invested in money market portfolios operating under Rule 2a-7 of the 1940 Act. Each fund bears the risk of loss with respect to the investment of cash collateral. Securities lending income, as disclosed in each 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 and broker rebates which are subject to adjustments pursuant to the securities lending agreement. On loans not collateralized by cash, a fee is received from the borrower, and is allocated between a fund and the lending agent. A fund retains the right to recall a security on loan. The aggregate market value of securities loaned will not at any time exceed one-third of the total assets of a fund, including collateral received from the loan (at market value computed at the time of the loan). Total costs and expenses, including agent fees associated with securities lending activities under the trust’s Securities Lending Program paid to the unaffiliated lending agent are approximately 15% of the gross lending revenues.

54 

 Schwab Equity Index Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

The values of the securities on loan and the related cash collateral are disclosed in the Portfolio Holdings and the Statement of Assets and Liabilities for each fund. The following table presents the non-cash collateral as of April 30, 2014:

	Non-Cash
	Collateral Received
Schwab 1000 Index Fund		$4,784,437

(c) Security Transactions:

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

Assets and liabilities denominated in foreign currencies are reported in U.S. dollars. For assets and liabilities held on a given date, the dollar value is based on market exchange rates in effect on that date. Transactions involving foreign currencies, including purchases, sales, income receipts and expense payments, are 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 forward 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. Any distributions from underlying funds are recorded in accordance with the character of the distributions as designated by the underlying funds.

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, 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 a fund’s operating expenses.

55

 Schwab Equity Index Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

(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, 2014, 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.

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.

Market Risk. 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.

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. 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.

Investment Style Risk. 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.

A significant percentage of an index may be composed of securities in a single industry or sector of the economy. If a fund is focused in an industry or sector, it may present more risks than if it were broadly diversified over numerous industries and sectors of the economy.

Sampling Index Tracking Risk. 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 will be 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

56 

 Schwab Equity Index Funds

Financial Notes, unaudited (continued)

3. Risk Factors (continued):

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.

Concentration Risk. To the extent that a fund’s or an index’s portfolio is concentrated in the securities of issuers in a particular market, industry, group of industries, sector, country, 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, country, or asset class.

Small-Cap Risk. 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 performance also will lag those investments.

Large- 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 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 or small-cap stocks, for instance — a fund’s performance also will lag those investments.

Foreign Investment Risk. 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); the imposition of economic sanctions or other government restrictions; differing accounting, auditing, financial reporting and legal standards and practices; differing securities market structures; and higher transaction costs. These risks may negatively impact the value or liquidity of a fund’s investments, and could impair the fund’s ability to meet its investment objective or invest in accordance with its investment strategies. These risks may be heightened in connection with investments in emerging markets. Foreign securities also include American Depositary Receipts (“ADRs”), Global Depositary Receipts (“GDRs”) and European Depositary Receipts (“EDRs”), which are depositary receipts issued by U.S. and foreign banks that represent shares of foreign-based corporations. ADRs, GDRs and EDRs may be less liquid than the underlying shares in their primary trading markets; and GDRs, many of which are issued by companies in emerging markets, may be more volatile.

Geographic Risk. 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.

Derivatives Risk. 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 a fund to realize higher amounts of short-term capital gain. These risks could cause a fund to lose more than the principal amount invested.

Liquidity Risk. 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.

Security Lending Risk. 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.

57

 Schwab Equity Index Funds

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 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%

For its advisory and administrative services to the other funds discussed in this report, 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%

58 

 Schwab Equity 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. The table below shows funds with investment activities involving The Charles Schwab Corporation shares during the report period:

	Balance						Balance				Realized		Dividends
	of Shares						of Shares		Market		Gains (Losses)		Received
	Held at		Gross		Gross		Held at		Value at		11/01/13		11/01/13
Fund	10/31/13		Purchases		Sales		04/30/14		04/30/14		to 04/30/14		to 04/30/14
Schwab S&P 500 Index Fund		1,232,381		35,200		—		1,267,581		$33,654,276		$—		$147,886
Schwab 1000 Index Fund		367,065		—		—		367,065		9,745,576		—		44,048
Schwab Total Stock Market Index Fund		182,326		15,000		—		197,326		5,239,005		—		22,437

Certain Schwab Funds may own shares of other Schwab Funds. The table below reflects the percentages of shares of each fund in this report that are owned by other Schwab Funds as of April 30, 2014, as applicable:

	Underlying Funds
								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		1.5%			—%		6.1%		—%		7.3%
Schwab MarketTrack Growth Portfolio		1.5%			—%		5.7%		—%		5.8%
Schwab MarketTrack Balanced Portfolio		0.8%			—%		3.1%		—%		3.2%
Schwab MarketTrack Conservative Portfolio		0.2%			—%		0.9%		—%		0.9%
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		0.2%			—%		—%		—%		—%
Schwab Target 2030 Fund		0.4%			—%		—%		—%		—%
Schwab Target 2035 Fund		0.2%			—%		—%		—%		—%
Schwab Target 2040 Fund		0.5%			—%		—%		—%		—%
Schwab Target 2045 Fund		0.0%	*		—%		—%		—%		—%
Schwab Target 2050 Fund		0.0%	*		—%		—%		—%		—%
Schwab Target 2055 Fund		0.0%	*		—%		—%		—%		—%

* Less than 0.1%

Certain other related parties may own shares of Schwab funds in this report. As of April 30, 2014, 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, Schwab Total Stock Market Index Fund and Schwab International Index Fund were 2.6%, 6.5% and 3.8%, 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 CSIM 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.

59

 Schwab Equity Index Funds

Financial Notes, unaudited (continued)

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.

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 on the funds’ 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 during the report period. The funds invested in futures to equitize available cash. The fair value and variation margin for futures contracts held at April 30, 2014 are presented on the Portfolio Holdings and Statement of Assets and Liabilities, 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		$477,006,642		5,195
Schwab 1000 Index Fund		34,186,625		373
Schwab Small-Cap Index Fund		76,366,792		666
Schwab Total Stock Market Index Fund		84,851,742		896
Schwab International Index Fund		59,401,850		628

8. Purchases and Sales/Maturities of Investment Securities:

For the period ended April 30, 2014, 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		$488,673,397		$117,410,171
Schwab 1000 Index Fund		140,526,171		201,070,167
Schwab Small-Cap Index Fund		158,832,087		30,888,998
Schwab Total Stock Market Index Fund		245,589,545		16,202,338
Schwab International Index Fund		256,108,251		19,109,276

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
	(11/1/13-4/30/14)		(11/1/12-10/31/13)
Schwab S&P 500 Index Fund		$97,608		$199,433
Schwab 1000 Index Fund		21,714		43,102
Schwab Small-Cap Index Fund		16,952		22,392
Schwab Total Stock Market Index Fund		39,408		45,887
Schwab International Index Fund		12,252		17,950

60 

 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, 2013, 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, 2014		$109,256,533		$—		$—		$—		$—
October 31, 2015		89,645,092		—		—		—		—
October 31, 2016		77,879,594		—		—		—		—
October 31, 2017		20,049,252		—		—		—		17,391,687
Total		$296,830,471		$—		$—		$—		$17,391,687

For the year ended October 31, 2013, the funds had capital losses utilized and capital losses expired 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		$67,871,433		$—		$—		$7,116,259		$8,898,651
Capital losses expired		50,785,672		—		—		—		—

As of October 31, 2013, 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, 2013, 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.

61

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 97 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).	76	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).	76	Director, Gilead Sciences, Inc. (2005 – present) Director, Monaco Coach Corporation (2005 – 2009)
David L. Mahoney 1954 Trustee (Trustee of Schwab Capital Trust and Schwab Investments since 2011.)	Private Investor.	76	Director, Symantec Corporation (2003 – present) Director, Corcept Therapeutics Incorporated (2004 – present)
Kiran M. Patel 1948 Trustee (Trustee of Schwab Capital Trust and Schwab Investments since 2011.)	Retired. Executive Vice President and General Manager of Small Business Group, Intuit, Inc. (financial software and services for consumers and small businesses) (Dec. 2008 – Sept. 2013).	76	Director, KLA-Tencor Corporation (2008 – present)
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).	76	Director, Eaton (2012 – present) Director and Chairman of the Audit Committee, Oneok Partners LP (2003 – 2013) Director, Oneok, Inc. (2009 – 2013) 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. (investment banking and securities firm) (Jan. 2008 – present); Partner, Colgin Partners, LLC (vineyards) (February 1998 – present).	76	Board Member and Chairman of the Audit Committee, Isis Pharmaceuticals (1994 – present)

62 

 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.	76	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.	97	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 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, Chief Executive Officer (Dec. 2010 – present), and Chief Investment Officer (Sept. 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 (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).

63

 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
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).
David Lekich 1964 Chief Legal Officer and Secretary (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 and Assistant Secretary (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 retire at age 72 or after twenty years as a trustee, whichever comes first. In addition, the retirement policy requires any independent trustee of 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 own stock of The Charles Schwab Corporation, the parent company of 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.

64 

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. Treasury Bills 1 − 3 Months Index An index that includes all publicly issued zero-coupon U.S. Treasury Bills that have a remaining maturity of less than 3 months and more than 1 month, are rated investment grade, and have $250 million or more of outstanding face 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 capital gain or loss is considered unrealized appreciation or depreciation.

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 (Europe, Australasia, Far East) 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.

restricted and illiquid securities Restricted securities are securities that are subject to legal restrictions on their sale. Restricted securities generally can be sold in privately negotiated transactions, pursuant to an exemption from registration under the Securities Act of1933 (the “1933 Act”), or in a registered public offering. Certain restricted securities, such as Section 4(a)(2) commercial paper and Rule 144A securities under the 1933 Act, may be considered to be liquid if they meet the criteria for liquidity established by the Board. Illiquid securities generally are any securities that cannot be disposed of promptly and in the ordinary course of business at approximately the amount at which a fund has valued the instruments. The liquidity of a fund’s investments is monitored under the supervision and direction of the Board. Investments currently not considered liquid include repurchase agreements not maturing within seven days and certain restricted securities.

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. It includes approximately 2000 of the smallest securities based on a combination of their market cap and current index membership.

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.

Schwab 1000 Index An index that represents the performance of the largest 1,000 publicly traded companies in the United States.

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.

65

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 the Schwab Funds’ 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.

^© 2014 Charles Schwab & Co., Inc. All rights reserved.

Member SIPC^®

Printed on recycled paper.

MFR13562-18

00118055

Semiannual report dated April 30, 2014, 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, 2014

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

This page is intentionally left blank.

Schwab Active Equity Funds

In This Report

Performance at a Glance	4
From the President	5
Fund Management	7
Performance and Fund Facts
Schwab Core Equity Fund™	8
Schwab Dividend Equity Fund™	9
Schwab Large-Cap Growth Fund™	10
Schwab Small-Cap Equity Fund™	11
Schwab Hedged Equity Fund™	12
Schwab Financial Services Fund™	13
Schwab Health Care Fund™	14
Schwab® International Core Equity Fund	15
Fund Expenses	17
Financial Statements and Portfolio Holdings
Schwab Core Equity Fund™	18
Schwab Dividend Equity Fund™	25
Schwab Large-Cap Growth Fund™	32
Schwab Small-Cap Equity Fund™	39
Schwab Hedged Equity Fund™	48
Schwab Financial Services Fund™	57
Schwab Health Care Fund™	63
Schwab® International Core Equity Fund	70
Financial Notes	80
Trustees and Officers	91
Glossary	94

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 Schwab. 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 6 Months Ended April 30, 2014
Schwab Core Equity Fundtm(Ticker Symbol: SWANX)	8.30%
S&P 500® Index	8.36%
Fund Category: Morningstar Large Blend	7.41%
Performance Details	page 8
Schwab Dividend Equity Fundtm(Ticker Symbol: SWDSX)	7.75%
S&P 500® Index	8.36%
Fund Category: Morningstar Large Value	8.14%
Performance Details	page 9
Schwab Large-Cap Growth Fundtm(Ticker Symbol: SWLSX)	6.88%
Russell 1000 Growth Index	6.95%
Fund Category: Morningstar Large Growth	5.09%
Performance Details	page 10
Schwab Small-Cap Equity Fundtm(Ticker Symbol: SWSCX)	7.05%
Russell 2000® Index	3.08%
Fund Category: Morningstar Small Blend	4.48%
Performance Details	page 11
Schwab Hedged Equity Fundtm(Ticker Symbol: SWHEX)	5.81%	3
S&P 500® Index	8.36%
Fund Category: Morningstar Long/Short Equity	3.15%
Performance Details	page 12
Schwab Financial Services Fundtm(Ticker Symbol: SWFFX)	6.91%
S&P 1500 SuperComposite Financial Sector Index	7.26%
Fund Category: Morningstar Financial	5.20%
Performance Details	page 13
Schwab Health Care Fundtm1(Ticker Symbol: SWHFX)	10.29%
Dow Jones Global Health Care Index	11.07%
Fund Category: Morningstar Health	10.33%
Performance Details	page 14
Schwab® International Core Equity Fund1 (Ticker Symbol: SICNX)	7.01%
MSCI EAFE® Index (Net)*	4.44%
Fund Category: Morningstar Foreign Large Blend	3.45%
Performance Details	pages 15-16

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.

For index definitions, please see the Glossary.

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, 2014, 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.
3	Total return for the report period presented in the table differs from the return in the Financial Highlights. The total return presented in the above table is calculated based on the NAV at which shareholder transactions were processed. The total return presented in the Financial Highlights section of the report is calculated in the same manner, but also takes into account certain adjustments that are necessary under generally accepted accounting principles required in the annual and semi-annual reports.

4 Schwab Active Equity 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 regarding the Schwab Active Equity Funds. Each fund employs a disciplined investment process that involves quantitative and fundamental research and analysis with a bottom-up approach to stock selection. To aid its stock selection process, the Portfolio Management team utilizes Schwab Equity Ratings^® as an input.

For the six-month reporting period ended April 30, 2014, the funds generated returns that reflected a rally by stocks, with the International Core Equity Fund and Schwab Small-Cap Equity Fund outperforming their comparative indices. The Schwab Health Care Fund generated a solid return but underperformed its comparative index, as momentum stocks faced challenges late in the period. In addition, the Schwab Hedged Equity Fund underperformed its comparative index, reflecting the fund’s use of short sale transactions that generally caused performance to lag when stocks rallied.

In the U.S., the Federal Reserve began “tapering” its stimulative economic policies. In spite of this policy shift, and harsh winter weather that temporarily slowed economic growth, many major U.S. stock market indices reached record highs in April, supported by the Fed’s reassurances that low interest rates remained necessary for now. Overseas, signs of possible improvement in the euro zone’s economy and efforts by the European Central Bank to keep interest rates low helped stocks in developed markets generate gains. However,

 Asset Class Performance Comparison % returns during the six months ended 4/30/2014

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

	8.36%	S&P 500® Index: measures U.S. large-cap stocks
	3.08%	Russell 2000® Index: measures U.S. small-cap stocks
	4.44%	MSCI EAFE® Index (Net): measures (in U.S. dollars) large-cap stocks in Europe, Australasia and the Far East
	1.74%	Barclays U.S. Aggregate Bond Index: measures the U.S. bond market
	0.02%	Barclays U.S. Treasury Bills 1-3 Months Index: 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.

For index definitions, please see the Glossary.

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 Active Equity Funds 5

From the President continued

For the six-month reporting period ended April 30, 2014, the funds generated returns that reflected a rally by stocks.

emerging markets faced concerns about higher U.S. interest rates, slow growth, and relatively high inflation, even as political unrest between Russia and the Ukraine drove up market volatility, increased risk, and reduced returns.

Amid this backdrop, large-cap stocks outperformed small-cap stocks, and value stocks generally outperformed growth stocks. The Health Care and Financials sectors generated some of the highest returns, while the Information Technology and Materials sectors underperformed by comparison. Reflecting these conditions, returns for the respective indices tracked by the funds ranged from 11.1% for the Dow Jones Global Health Care Index, to 3.1% for the Russell 2000 Index.

For more information about the performance, holdings, and portfolio characteristics of the Schwab Active Equity Funds, please continue reading this report. In addition, you can find further details about these funds by visiting www.schwabfunds.com, or by contacting us at 1-800-435-4000.

Sincerely,

For full definitions of the referenced indices, please see the Glossary.

6 Schwab Active Equity Funds

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.

Wei Li, Ph.D., CFA Managing Director and Senior Portfolio Manager, is responsible for the day-to-day co-management of the funds. 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.

Schwab Active Equity Funds 7

Schwab Core Equity Fund™

Performance and Fund Facts as of 04/30/14

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)		8.30	%		20.07	%		17.17	%		7.79	%
S&P 500® Index		8.36	%		20.44	%		19.14	%		7.67	%
Fund Category: Morningstar Large Blend		7.41	%		19.35	%		17.82	%		7.17	%

Fund Expense Ratio⁴: 0.73%

 Statistics

Number of Holdings	131
Weighted Average Market Cap ($ x 1,000,000)	$89,711
Price/Earnings Ratio (P/E)	16.5
Price/Book Ratio (P/B)	2.2
Portfolio Turnover Rate5	35%

 Sector Weightings % of Investments

Information Technology	17.8%
Health Care	15.6%
Financials	13.7%
Energy	11.8%
Industrials	10.7%
Consumer Discretionary	10.3%
Consumer Staples	8.2%
Utilities	5.7%
Materials	4.5%
Telecommunication Services	1.4%
Other	0.3%
Total	100.0%

 Top Equity Holdings % of Net Assets⁶

Wells Fargo & Co.	3.2%
Pfizer, Inc.	2.6%
PepsiCo, Inc.	2.5%
Occidental Petroleum Corp.	2.5%
Archer-Daniels-Midland Co.	2.3%
Apple, Inc.	2.2%
Oracle Corp.	2.1%
ConocoPhillips	2.0%
Medtronic, Inc.	2.0%
The PNC Financial Services Group, Inc.	2.0%
Total	23.4%

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.

For index definitions, please see the Glossary.

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 and September 7, 2012, respectively, the Laudus U.S. MarketMasters Fund and the Schwab Premier Equity Fund merged into the fund.
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 Dividend Equity Fund™

Performance and Fund Facts as of 04/30/14

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 Dividend Equity Fundtm (9/2/03)		7.75	%		19.30	%		18.08	%		8.18	%
S&P 500® Index		8.36	%		20.44	%		19.14	%		7.67	%
Russell 1000 Value Index		9.61	%		20.90	%		19.52	%		7.95	%
Fund Category: Morningstar Large Value		8.14	%		19.20	%		17.71	%		7.18	%

Fund Expense Ratio⁴: 0.89%

 Yields¹

30-Day SEC Yield 1.40%

 Statistics

Number of Holdings	134
Weighted Average Market Cap ($ x 1,000,000)	$89,574
Price/Earnings Ratio (P/E)	15.9
Price/Book Ratio (P/B)	1.9
Portfolio Turnover Rate5	36%

 Sector Weightings % of Investments

Financials	26.0%
Energy	15.5%
Health Care	14.0%
Industrials	9.0%
Information Technology	8.9%
Utilities	7.5%
Consumer Discretionary	6.5%
Consumer Staples	5.3%
Materials	4.4%
Telecommunication Services	1.9%
Other	1.0%
Total	100.0%

 Top Equity Holdings % of Net Assets⁶

Wells Fargo & Co.	4.0%
Johnson & Johnson	3.0%
Pfizer, Inc.	2.8%
Exxon Mobil Corp.	2.7%
ConocoPhillips	2.6%
Chevron Corp.	2.5%
Occidental Petroleum Corp.	2.4%
Medtronic, Inc.	2.1%
The Dow Chemical Co.	2.0%
The PNC Financial Services Group, Inc.	2.0%
Total	26.1%

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.

For index definitions, please see the Glossary.

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. 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 9

Schwab Large-Cap Growth Fund™

Performance and Fund Facts as of 04/30/14

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)		6.88	%		19.56	%		17.39	%		6.68	%
Russell 1000 Growth Index		6.95	%		20.66	%		19.47	%		8.27	%
Fund Category: Morningstar Large Growth		5.09	%		20.34	%		17.61	%		7.15	%

Fund Expense Ratios⁴: Net 0.99%; Gross 1.05%

 Statistics

Number of Holdings	106
Weighted Average Market Cap ($ x 1,000,000)	$85,164
Price/Earnings Ratio (P/E)	19.8
Price/Book Ratio (P/B)	3.4
Portfolio Turnover Rate5	41%

 Sector Weightings % of Investments

Information Technology	24.8%
Consumer Discretionary	16.7%
Health Care	15.1%
Industrials	12.4%
Consumer Staples	11.6%
Financials	8.5%
Energy	4.7%
Materials	3.8%
Telecommunication Services	1.5%
Utilities	0.6%
Other	0.3%
Total	100.0%

 Top Equity Holdings % of Net Assets⁶

Apple, Inc.	4.3%
Oracle Corp.	3.3%
PepsiCo, Inc.	3.0%
Microsoft Corp.	2.9%
EOG Resources, Inc.	2.2%
United Parcel Service, Inc., Class B	2.1%
The Kroger Co.	2.1%
Comcast Corp., Class A	2.0%
Celgene Corp.	2.0%
Amgen, Inc.	2.0%
Total	25.9%

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.

For index definitions, please see the Glossary.

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.

10 Schwab Active Equity Funds

Schwab Small-Cap Equity Fund™

Performance and Fund Facts as of 04/30/14

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 Small-Cap Equity Fundtm (7/1/03)		7.05	%		26.65	%		22.47	%		9.68	%
Russell 2000® Index		3.08	%		20.50	%		19.84	%		8.67	%
Fund Category: Morningstar Small Blend		4.48	%		21.54	%		19.86	%		8.76	%

Fund Expense Ratio⁴: 1.11%

 Statistics

Number of Holdings	326
Weighted Average Market Cap ($ x 1,000,000)	$1,722
Price/Earnings Ratio (P/E)	34.3
Price/Book Ratio (P/B)	1.8
Portfolio Turnover Rate5	51%

 Sector Weightings % of Investments

Financials	20.0%
Information Technology	19.2%
Health Care	15.8%
Industrials	12.6%
Consumer Discretionary	10.9%
Energy	7.6%
Materials	5.2%
Consumer Staples	4.4%
Telecommunication Services	1.2%
Utilities	1.1%
Other	2.0%
Total	100.0%

 Top Equity Holdings % of Net Assets⁶

Stone Energy Corp.	1.2%
Aspen Technology, Inc.	1.0%
ARRIS Group, Inc.	1.0%
International Rectifier Corp.	0.9%
PTC, Inc.	0.9%
Commercial Metals Co.	0.9%
RLJ Lodging Trust	0.9%
American Equity Investment Life Holding Co.	0.9%
CNO Financial Group, Inc.	0.9%
Impax Laboratories, Inc.	0.9%
Total	9.5%

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.

For index definitions, please see the Glossary.

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 many 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.

Schwab Active Equity Funds 11

Schwab Hedged Equity Fund™

Performance and Fund Facts as of 04/30/14

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)		5.81	%	4		11.12	%		10.39	%		5.78	%
S&P 500® Index		8.36	%			20.44	%		19.14	%		7.67	%
Fund Category: Morningstar Long/Short Equity		3.15	%			9.34	%		9.95	%		6.19	%

Fund Expense Ratios⁵: Net 2.48%; Gross 2.52%

 Statistics

Number of Holdings
Long Holdings	134
Short Holdings	81
Weighted Average Market Cap ($ x 1,000,000)
Long Holdings	$46,587
Short Holdings	$6,955
Price/Earnings Ratio (P/E)
Long Holdings	18.6
Short Holdings	80.5
Price/Book Ratio (P/B)
Long Holdings	2.0
Short Holdings	3.1
Portfolio Turnover Rate6	72%
Portfolio Turnover Rate excluding short sales6	38%

 Top Equity Long Holdings

 % of Net Assets⁷

Pfizer, Inc.	2.3%
ConocoPhillips	2.3%
Occidental Petroleum Corp.	2.1%
EOG Resources, Inc.	2.1%
The PNC Financial Services Group, Inc.	2.1%
Total	10.9%

 Top Equity Short Holdings

 % of Net Assets⁷

C.H. Robinson Worldwide, Inc.	1.3%
Eagle Materials, Inc.	1.3%
M&T Bank Corp.	1.3%
Fastenal Co.	1.3%
Kate Spade & Co.	1.2%
Total	6.4%

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.

For index definitions, please see the Glossary.

The Schwab 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	Total return for the report period presented in the table differs from the return in the Financial Highlights. The total return presented in the above table is calculated based on the NAV at which shareholder transactions were processed. The total return presented in the Financial Highlights section of the report is calculated in the same manner, but also takes into account certain adjustments that are necessary under generally accepted accounting principles required in the annual and semi-annual reports.
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.
6	Not annualized.
7	This list is not a recommendation of any security by the investment adviser.

12 Schwab Active Equity Funds

Schwab Financial Services Fund™

Performance and Fund Facts as of 04/30/14

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)		6.91	%		17.49	%		15.96	%		4.00	%
S&P 1500 SuperComposite Financial Sector Index		7.26	%		18.42	%		17.14	%		0.58	%
S&P 500® Index		8.36	%		20.44	%		19.14	%		7.67	%
Fund Category: Morningstar Financial		5.20	%		17.60	%		15.43	%		3.41	%

Fund Expense Ratios³: Net 0.94%; Gross 1.03%

 Statistics

Number of Holdings	66
Weighted Average Market Cap ($ x 1,000,000)	$85,151
Price/Earnings Ratio (P/E)	15.8
Price/Book Ratio (P/B)	1.2
Portfolio Turnover Rate4	29%

 Industry Weightings % of Investments

Banks	37.9%
Diversified Financials	24.3%
Real Estate	18.9%
Insurance	18.8%
Other	0.1%
Total	100.0%

 Top Equity Holdings % of Net Assets⁵

Wells Fargo & Co.	9.3%
JPMorgan Chase & Co.	6.8%
Citigroup, Inc.	6.4%
Berkshire Hathaway, Inc., Class B	5.3%
Bank of America Corp.	4.5%
The PNC Financial Services Group, Inc.	3.2%
Capital One Financial Corp.	3.1%
The Bank of New York Mellon Corp.	2.3%
MetLife, Inc.	2.2%
Aflac, Inc.	2.1%
Total	45.2%

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.

For index definitions, please see the Glossary.

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.

Schwab Active Equity Funds 13

Schwab Health Care Fund™

Performance and Fund Facts as of 04/30/14

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)		10.29	%		23.57	%		22.87	%		11.86	%
Dow Jones Global Health Care Index		11.07	%		20.70	%		20.76	%		9.42	%
S&P 500® Index		8.36	%		20.44	%		19.14	%		7.67	%
Fund Category: Morningstar Health		10.33	%		27.14	%		22.62	%		10.44	%

Fund Expense Ratios³: Net 0.82%; Gross 0.83%

 Statistics

Number of Holdings	96
Weighted Average Market Cap ($ x 1,000,000)	$97,260
Price/Earnings Ratio (P/E)	24.6
Price/Book Ratio (P/B)	3.4
Portfolio Turnover Rate4	23%

 Industry Weightings % of Investments

Pharmaceuticals, Biotechnology & Life Sciences	73.0%
Healthcare – Services	25.0%
Materials	1.7%
Other	0.3%
Total	100.0%

 Top Equity Holdings % of Net Assets⁵

Johnson & Johnson	7.9%
Pfizer, Inc.	7.0%
Merck & Co., Inc.	5.8%
AbbVie, Inc.	4.4%
Novartis AG – Reg’d	4.1%
Amgen, Inc.	3.9%
Medtronic, Inc.	3.8%
Biogen Idec, Inc.	3.7%
Celgene Corp.	3.6%
Gilead Sciences, Inc.	3.6%
Total	47.8%

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.

For index definitions, please see the Glossary.

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.

14 Schwab Active Equity Funds

Schwab^® International Core Equity Fund

Performance and Fund Facts as of 04/30/14

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® International Core Equity Fund (5/30/08)		7.01	%		16.89	%		16.16	%		2.90	%
MSCI EAFE® Index (Net)4		4.44	%		13.35	%		13.58	%		1.27	%
MSCI EAFE® Index (Gross)4		4.67	%		13.80	%		14.10	%		1.73	%
Fund Category: Morningstar Foreign Large Blend		3.45	%		11.69	%		13.12	%		0.56	%

Fund Expense Ratios: Net 0.86%; Gross 1.10%

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.

For index definitions, please see the Glossary.

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

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	Effective February 28, 2014, 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.

Schwab Active Equity Funds 15

 Schwab^® International Core Equity Fund

Performance and Fund Facts as of 04/30/14 continued

 Statistics

Number of Holdings	166
Weighted Average Market Cap ($ x 1,000,000)	$59,048
Price/Earnings Ratio (P/E)	16.7
Price/Book Ratio (P/B)	1.4
Portfolio Turnover Rate1	40%

 Sector Weightings % of Investments

Financials	24.3%
Health Care	12.0%
Industrials	11.4%
Consumer Discretionary	10.6%
Consumer Staples	9.3%
Energy	9.2%
Materials	7.0%
Telecommunication Services	6.1%
Information Technology	5.5%
Utilities	2.1%
Other	2.5%
Total	100.0%

 Top Equity Holdings % of Net Assets²

Total S.A.	2.8%
Sanofi	2.6%
AstraZeneca plc	2.4%
Toyota Motor Corp.	1.9%
DBS Group Holdings Ltd.	1.9%
Allianz SE – Reg’d	1.9%
Resona Holdings, Inc.	1.8%
Intesa Sanpaolo S.p.A.	1.8%
Mizuho Financial Group, Inc.	1.7%
Total	18.8%

 Country Weightings % of Investments

United Kingdom	19.6%
Japan	18.2%
France	11.2%
Switzerland	9.4%
Germany	7.7%
Australia	6.3%
Sweden	3.9%
Italy	2.8%
Singapore	2.8%
Other Countries	18.1%
Total	100.0%

Portfolio holdings may have changed since the report date.

Source of Sector Classification: S&P and MSCI.

International investments are subject to additional risks such as currency fluctuation, geopolitical risk and the potential for illiquid markets.

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

16 Schwab Active Equity Funds

Fund Expenses (Unaudited)

 Examples for a $1,000 Investment

As a fund shareholder, you may incur two types of costs: (1) transaction costs, such as redemption fees; and (2) ongoing costs, including 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, 2013 and held through April 30, 2014.

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 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 a 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. Therefore, the hypothetical return lines of the table are useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, 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 11/1/13		at 4/30/14		11/1/13–4/30/14
Schwab Core Equity Fundtm
Actual Return		0.72%	$	1,000.00	$	1,083.00	$	3.72
Hypothetical 5% Return		0.72%	$	1,000.00	$	1,021.22	$	3.61
Schwab Dividend Equity Fundtm
Actual Return		0.89%	$	1,000.00	$	1,077.50	$	4.58
Hypothetical 5% Return		0.89%	$	1,000.00	$	1,020.38	$	4.46
Schwab Large-Cap Growth Fundtm
Actual Return		0.99%	$	1,000.00	$	1,068.80	$	5.08
Hypothetical 5% Return		0.99%	$	1,000.00	$	1,019.89	$	4.96
Schwab Small-Cap Equity Fundtm
Actual Return		1.09%	$	1,000.00	$	1,070.50	$	5.60
Hypothetical 5% Return		1.09%	$	1,000.00	$	1,019.39	$	5.46
Schwab Hedged Equity Fundtm
Actual Return		2.12%	$	1,000.00	$	1,057.50	$	10.82
Hypothetical 5% Return		2.12%	$	1,000.00	$	1,014.28	$	10.59
Schwab Financial Services Fundtm
Actual Return		0.91%	$	1,000.00	$	1,069.10	$	4.67
Hypothetical 5% Return		0.91%	$	1,000.00	$	1,020.28	$	4.56
Schwab Health Care Fundtm
Actual Return		0.80%	$	1,000.00	$	1,102.90	$	4.17
Hypothetical 5% Return		0.80%	$	1,000.00	$	1,020.83	$	4.01
Schwab® International Core Equity Fund
Actual Return		0.86%	$	1,000.00	$	1,070.10	$	4.41
Hypothetical 5% Return		0.86%	$	1,000.00	$	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.

Schwab Active Equity Funds 17

Schwab Core Equity Fund™

Financial Statements

Financial Highlights

	11/1/13–			11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–
	4/30/14*			10/31/13			10/31/12			10/31/11			10/31/10			10/31/09
Per-Share Data ($)
Net asset value at beginning of period		23.46			18.80			16.81			15.78			14.26			13.43
Income (loss) from investment operations:
Net investment income (loss)		0.14			0.32			0.26			0.19			0.17			0.17
Net realized and unrealized gains (losses)		1.69			4.51			2.07			1.01			1.50			0.88
Total from investment operations		1.83			4.83			2.33			1.20			1.67			1.05
Less distributions:
Distributions from net investment income		(0.22	)		(0.17	)		(0.34	)		(0.17	)		(0.15	)		(0.22	)
Distributions from net realized gains		(1.66	)		—			—			—			—			—
Total distributions		(1.88	)		(0.17	)		(0.34	)		(0.17	)		(0.15	)		(0.22	)
Net asset value at end of period		23.41			23.46			18.80			16.81			15.78			14.26
Total return (%)		8.30	1		25.89			13.99			7.60			11.77			8.11
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		0.72	2		0.72			0.72			0.73			0.73			0.75
Gross operating expenses		0.72	2		0.73			0.73			0.73			0.74			0.78
Net investment income (loss)		1.16	2		1.51			1.37			1.06			1.05			1.39
Portfolio turnover rate		35	1		80			45	3		35			49			41	3
Net assets, end of period ($ x 1,000,000)		2,325			2,247			1,880			1,719			1,792			1,770

* Unaudited.

¹ Not annualized.

² Annualized.

³ Portfolio turnover excludes the impact of investment activities from mergers with other funds.

18 See financial notes

 Schwab Core Equity Fund

Portfolio Holdings as of April 30, 2014 (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	.3%	Common Stock		1,834,945,768		2,308,462,127
	0	.2%	Other Investment Company		5,680,346		5,680,346
	0	.1%	Short-Term Investment		599,959		599,959
	99	.6%	Total Investments		1,841,226,073		2,314,742,432
	0	.4%	Other Assets and Liabilities, Net				9,786,968
	100	.0%	Net Assets				2,324,529,400

	Number		Value
Security	of Shares		($)
Common Stock 99.3% of net assets
Banks 7.8%
Bank of America Corp.		2,177,200		32,962,808
Citigroup, Inc.		315,000		15,091,650
JPMorgan Chase & Co.		256,240		14,344,315
The PNC Financial Services Group, Inc.		547,400		46,003,496
Wells Fargo & Co.		1,483,200		73,626,048
				182,028,317
Capital Goods 7.1%
Danaher Corp.		144,400		10,596,072
Emerson Electric Co.		94,100		6,415,738
General Dynamics Corp.		124,300		13,604,635
General Electric Co.		396,100		10,651,129
IDEX Corp.		154,500		11,521,065
Masco Corp.		252,200		5,066,698
Northrop Grumman Corp.		310,800		37,765,308
PACCAR, Inc.		154,400		9,878,512
Parker Hannifin Corp.		54,100		6,864,208
The Boeing Co.		290,000		37,415,800
United Rentals, Inc. *		168,900		15,847,887
				165,627,052
Commercial & Professional Supplies 1.0%
Manpowergroup, Inc.		101,600		8,264,144
R.R. Donnelley & Sons Co.		849,900		14,958,240
				23,222,384
Consumer Durables & Apparel 2.4%
Hanesbrands, Inc.		89,800		7,371,682
Jarden Corp. *		332,250		18,988,088
NIKE, Inc., Class B		325,400		23,737,930
Whirlpool Corp.		39,600		6,073,848
				56,171,548
Consumer Services 2.4%
MGM Resorts International *		986,800		24,896,964
Service Corp. International		212,700		3,992,379
Wyndham Worldwide Corp.		204,000		14,553,360
Wynn Resorts Ltd.		54,900		11,193,561
				54,636,264
Diversified Financials 2.4%
Berkshire Hathaway, Inc., Class B *		112,100		14,444,085
Capital One Financial Corp.		380,400		28,111,560
Lazard Ltd., Class A		190,700		8,972,435
The NASDAQ OMX Group, Inc.		49,900		1,841,310
Waddell & Reed Financial, Inc., Class A		36,400		2,455,180
				55,824,570
Energy 11.7%
Baker Hughes, Inc.		257,000		17,964,300
Chevron Corp.		318,100		39,927,912
ConocoPhillips		636,700		47,313,177
EOG Resources, Inc.		348,000		34,104,000
Exxon Mobil Corp.		145,500		14,900,655
Hess Corp.		125,600		11,198,496
Marathon Petroleum Corp.		72,100		6,701,695
Murphy Oil Corp.		140,565		8,916,038
Occidental Petroleum Corp.		598,290		57,286,267
Phillips 66		142,100		11,825,562
SM Energy Co.		232,600		17,242,638
Valero Energy Corp.		94,500		5,402,565
				272,783,305
Food & Staples Retailing 0.8%
The Kroger Co.		226,400		10,423,456
Walgreen Co.		121,300		8,236,270
				18,659,726
Food, Beverage & Tobacco 6.5%
Altria Group, Inc.		325,800		13,067,838
Archer-Daniels-Midland Co.		1,235,900		54,045,907
Bunge Ltd.		72,800		5,798,520
Dr Pepper Snapple Group, Inc.		57,400		3,181,108
PepsiCo, Inc.		680,400		58,439,556
The Hillshire Brands Co.		341,800		12,185,170
Tyson Foods, Inc., Class A		84,400		3,542,268
				150,260,367
Health Care Equipment & Services 6.0%
Align Technology, Inc. *		79,400		4,000,966
Becton, Dickinson & Co.		21,500		2,430,145
Boston Scientific Corp. *		332,500		4,192,825
C.R. Bard, Inc.		95,800		13,156,214
Cardinal Health, Inc.		512,900		35,651,679

See financial notes 19

 Schwab Core Equity Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
CareFusion Corp. *		449,300		17,549,658
Centene Corp. *		78,300		5,199,120
McKesson Corp.		59,200		10,016,048
Medtronic, Inc.		784,100		46,120,762
				138,317,417
Household & Personal Products 0.9%
Energizer Holdings, Inc.		186,800		20,863,692
Insurance 3.1%
Aflac, Inc.		265,200		16,633,344
Axis Capital Holdings Ltd.		64,800		2,964,600
CNO Financial Group, Inc.		557,800		9,622,050
Genworth Financial, Inc., Class A *		557,561		9,952,464
MetLife, Inc.		291,300		15,249,555
Protective Life Corp.		65,700		3,360,555
Reinsurance Group of America, Inc.		88,800		6,811,848
The Travelers Cos., Inc.		81,000		7,336,980
				71,931,396
Materials 4.5%
Ashland, Inc.		120,100		11,601,660
Avery Dennison Corp.		169,700		8,257,602
International Paper Co.		142,000		6,624,300
PPG Industries, Inc.		193,000		37,368,660
Steel Dynamics, Inc.		343,200		6,270,264
The Dow Chemical Co.		684,700		34,166,530
				104,289,016
Media 2.1%
Comcast Corp., Class A		455,000		23,550,800
Live Nation Entertainment, Inc. *		239,800		5,007,024
Viacom, Inc., Class B		241,800		20,548,164
				49,105,988
Pharmaceuticals, Biotechnology & Life Sciences 9.6%
AbbVie, Inc.		220,000		11,457,600
Amgen, Inc.		285,552		31,910,436
Biogen Idec, Inc. *		16,500		4,737,480
Celgene Corp. *		236,000		34,694,360
Johnson & Johnson		337,300		34,165,117
Merck & Co., Inc.		230,980		13,526,189
Pfizer, Inc.		1,946,100		60,874,008
Salix Pharmaceuticals Ltd. *		56,300		6,193,000
Thermo Fisher Scientific, Inc.		219,300		25,000,200
				222,558,390
Real Estate 0.3%
CBRE Group, Inc., Class A *		140,700		3,748,248
RLJ Lodging Trust		137,200		3,659,124
				7,407,372
Retailing 3.4%
Amazon.com, Inc. *		26,000		7,907,380
Best Buy Co., Inc.		315,600		8,183,508
GameStop Corp., Class A		70,500		2,797,440
Liberty Interactive Corp., Class A *		511,400		14,861,284
Macy’s, Inc.		591,500		33,969,845
The Home Depot, Inc.		146,000		11,608,460
				79,327,917
Semiconductors & Semiconductor Equipment 0.7%
Intel Corp.		607,300		16,208,837
Software & Services 9.8%
Activision Blizzard, Inc.		456,400		9,132,564
AOL, Inc. *		224,300		9,602,283
CA, Inc.		817,700		24,645,478
Computer Sciences Corp.		370,500		21,926,190
Global Payments, Inc.		76,700		5,125,861
Google, Inc., Class A *		16,700		8,932,496
Google, Inc., Class C *		16,700		8,795,222
Jack Henry & Associates, Inc.		164,800		9,090,368
Microsoft Corp.		756,800		30,574,720
Oracle Corp.		1,169,900		47,825,512
Synopsys, Inc. *		474,942		17,867,318
Xerox Corp.		2,782,200		33,636,798
				227,154,810
Technology Hardware & Equipment 7.2%
Apple, Inc.		87,400		51,573,866
Brocade Communications Systems, Inc. *		237,800		2,213,918
Cisco Systems, Inc.		529,300		12,232,123
Hewlett-Packard Co.		1,285,200		42,488,712
NetApp, Inc.		424,000		15,098,640
SanDisk Corp.		118,800		10,094,436
TE Connectivity Ltd.		163,300		9,631,434
Western Digital Corp.		281,900		24,843,847
				168,176,976
Telecommunication Services 1.3%
Telephone & Data Systems, Inc.		173,071		4,705,800
Verizon Communications, Inc.		570,800		26,673,484
				31,379,284
Transportation 2.6%
Delta Air Lines, Inc.		535,800		19,733,514
FedEx Corp.		115,200		15,696,000
Southwest Airlines Co.		999,000		24,145,830
				59,575,344
Utilities 5.7%
AES Corp.		1,578,400		22,807,880
Ameren Corp.		562,000		23,216,220
American Electric Power Co., Inc.		453,700		24,413,597
CenterPoint Energy, Inc.		446,400		11,052,864
Edison International		495,400		28,019,824
Entergy Corp.		133,000		9,642,500

20 See financial notes

 Schwab Core Equity Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
NextEra Energy, Inc.		138,200		13,799,270
				132,952,155
Total Common Stock
(Cost $1,834,945,768)				2,308,462,127
Other Investment Company 0.2% of net assets
Money Market Fund 0.2%
State Street Institutional U.S. Government Money Market Fund, Institutional Class 0.00% (c)		5,680,346		5,680,346
Total Other Investment Company
(Cost $5,680,346)				5,680,346
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investment 0.1% of net assets
U.S. Treasury Obligation 0.1%
U.S. Treasury Bill
0.05%, 06/19/14 (a)(b)		600,000		599,959
Total Short-Term Investment
(Cost $599,959)				599,959
End of Investments.

At 04/30/14, the tax basis cost of the fund’s investments was $1,841,866,802 and the unrealized appreciation and depreciation were $484,424,808 and ($11,549,178), respectively, with a net unrealized appreciation of $472,875,630.

*	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)	The rate shown is the 7-day yield.

In addition to the above, the fund held the following at 04/30/14:

			Contract		Unrealized
	Number of		Value		Appreciation
	Contracts		($)		($)
Futures Contracts
S&P 500 Index, e-mini, Long, expires 06/20/14		41		3,849,695		78,128

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2014 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Other Significant		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Common Stock1		$2,308,462,127		$—		$—		$2,308,462,127
Other Investment Company1		5,680,346		—		—		5,680,346
Short-Term Investment1		—		599,959		—		599,959
Total		$2,314,142,473		$599,959		$—		$2,314,742,432
Other Financial Instruments
Futures Contracts2		$78,128		$—		$—		$78,128

1	As categorized in portfolio holdings.
2	Futures contracts are not included in Investments in the schedule of portfolio holdings 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, 2014.

See financial notes 21

 Schwab Core Equity Fund

Statement of

Assets and Liabilities

As of April 30, 2014; unaudited

Assets
Investments, at value (cost $1,841,226,073)		$2,314,742,432
Receivables:
Investments sold		8,623,577
Fund shares sold		1,364,157
Dividends		967,981
Variation margin on futures contracts		12,505
Prepaid expenses	+	29,499
Total assets		2,325,740,151
Liabilities
Payables:
Investment adviser and administrator fees		89,580
Shareholder service fees		59,772
Independent trustees’ fees		6
Fund shares redeemed		980,735
Accrued expenses	+	80,658
Total liabilities		1,210,751
Net Assets
Total assets		2,325,740,151
Total liabilities	−	1,210,751
Net assets		$2,324,529,400
Net Assets by Source
Capital received from investors		1,721,466,521
Net investment income not yet distributed		10,456,437
Net realized capital gains		119,011,955
Net unrealized capital appreciation		473,594,487
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$2,324,529,400		99,289,927			$23.41

22 See financial notes

 Schwab Core Equity Fund

Statement of

Operations

For the period November 1, 2013 through April 30, 2014; unaudited

Investment Income
Dividends (net of foreign withholding taxes of $3,390)		$21,293,587
Interest		147
Securities on loan	+	62
Total investment income		21,293,796
Expenses
Investment adviser and administrator fees		5,328,035
Shareholder service fees		2,637,216
Shareholder reports		65,407
Portfolio accounting fees		40,155
Transfer agent fees		30,659
Custodian fees		22,898
Registration fees		22,245
Professional fees		20,000
Independent trustees’ fees		8,680
Interest expense		62
Other expenses	+	22,925
Total expenses		8,198,282
Expense reduction by CSIM and its affiliates	−	30,659
Net expenses	−	8,167,623
Net investment income		13,126,173
Realized and Unrealized Gains (Losses)
Net realized gains on investments		155,686,674
Net realized losses on futures contracts	+	(113,020	)
Net realized gains		155,573,654
Net change in unrealized appreciation (depreciation) on investments		13,188,096
Net change in unrealized appreciation (depreciation) on futures contracts	+	(85,248	)
Net change in unrealized appreciation (depreciation)	+	13,102,848
Net realized and unrealized gains		168,676,502
Increase in net assets resulting from operations		$181,802,675

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

11/1/13-4/30/14				11/1/12-10/31/13
Net investment income		$13,126,173			$31,158,073
Net realized gains		155,573,654			232,627,413
Net change in unrealized appreciation (depreciation)	+	13,102,848			209,621,022
Increase in net assets from operations		181,802,675			473,406,508
Distributions to Shareholders
Distributions from net investment income		(21,200,511	)		(16,475,044	)
Distributions from net realized gains	+	(157,596,466	)		—
Total distributions		($178,796,977	)		($16,475,044	)

Transactions in Fund Shares

		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		VALUE			SHARES		VALUE
Shares sold			6,630,554		$149,787,598			9,345,311		$194,423,482
Shares reinvested			4,044,873		89,432,146			445,622		8,359,860
Shares redeemed	+		(7,161,004	)	(164,819,342	)		(13,994,307	)	(292,667,176	)
Net transactions in fund shares			3,514,423		$74,400,402			(4,203,374	)	($89,883,834	)
Shares Outstanding and Net Assets
		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			95,775,504		$2,247,123,300			99,978,878		$1,880,075,670
Total increase or decrease	+		3,514,423		77,406,100			(4,203,374	)	367,047,630
End of period			99,289,927		$2,324,529,400			95,775,504		$2,247,123,300
Net investment income not yet distributed					$10,456,437					$18,530,775

24 See financial notes

Schwab Dividend Equity Fund™

Financial Statements

Financial Highlights

	11/1/13–			11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–
	4/30/14*			10/31/13			10/31/12			10/31/11			10/31/10			10/31/091
Per-Share Data ($)
Net asset value at beginning of period		18.22			14.52			13.15			12.08			10.94			10.63
Income (loss) from investment operations:
Net investment income (loss)		0.14			0.32			0.27			0.23			0.21			0.25
Net realized and unrealized gains (losses)		1.19			3.70			1.38			1.06			1.14			0.31
Total from investment operations		1.33			4.02			1.65			1.29			1.35			0.56
Less distributions:
Distributions from net investment income		(0.15	)		(0.32	)		(0.28	)		(0.22	)		(0.21	)		(0.25	)
Distributions from net realized gains		(1.19	)		—			—			—			—			—
Total distributions		(1.34	)		(0.32	)		(0.28	)		(0.22	)		(0.21	)		(0.25	)
Net asset value at end of period		18.21			18.22			14.52			13.15			12.08			10.94
Total return (%)		7.75	2		27.99			12.65			10.73			12.42			5.62
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		0.89	3		0.89			0.89			0.89			0.89			0.90	4
Gross operating expenses		0.89	3		0.89			0.89			0.89			0.89			0.91
Net investment income (loss)		1.54	3		1.97			1.89			1.77			1.74			2.40
Portfolio turnover rate		36	2		64			55			31			37			39
Net assets, end of period ($ x 1,000,000)		1,949			1,804			1,390			1,325			1,322			1,297

* 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, 2014 (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	.7%	Common Stock		1,536,461,319		1,924,485,887
	1	.0%	Short-Term Investments		18,978,469		18,978,469
	99	.7%	Total Investments		1,555,439,788		1,943,464,356
	0	.3%	Other Assets and Liabilities, Net				5,555,850
	100	.0%	Net Assets				1,949,020,206

	Number		Value
Security	of Shares		($)
Common Stock 98.7% of net assets
Banks 10.1%
Bank of America Corp.		1,704,200		25,801,588
CIT Group, Inc.		43,800		1,885,590
Citigroup, Inc.		214,600		10,281,486
First Niagara Financial Group, Inc.		387,000		3,452,040
Huntington Bancshares, Inc.		430,000		3,938,800
JPMorgan Chase & Co.		563,284		31,532,638
Regions Financial Corp.		376,400		3,816,696
The PNC Financial Services Group, Inc.		461,400		38,776,056
Wells Fargo & Co.		1,569,100		77,890,124
				197,375,018
Capital Goods 6.5%
3M Co.		81,400		11,321,926
Emerson Electric Co.		329,700		22,478,946
Exelis, Inc.		46,700		865,818
General Dynamics Corp.		19,200		2,101,440
General Electric Co.		994,000		26,728,660
IDEX Corp.		32,600		2,430,982
Northrop Grumman Corp.		217,200		26,391,972
Parker Hannifin Corp.		78,900		10,010,832
The Boeing Co.		137,800		17,778,956
United Rentals, Inc. *		73,900		6,934,037
				127,043,569
Commercial & Professional Supplies 1.4%
KAR Auction Services, Inc.		47,300		1,408,594
Manpowergroup, Inc.		26,500		2,155,510
Pitney Bowes, Inc.		349,800		9,374,640
R.R. Donnelley & Sons Co.		804,000		14,150,400
				27,089,144
Consumer Durables & Apparel 1.1%
Hasbro, Inc.		51,900		2,867,994
Whirlpool Corp.		116,400		17,853,432
				20,721,426
Consumer Services 1.0%
Bally Technologies, Inc. *		8,200		533,902
International Game Technology		274,700		3,447,485
Las Vegas Sands Corp.		44,800		3,545,024
Wyndham Worldwide Corp.		59,500		4,244,730
Wynn Resorts Ltd.		37,200		7,584,708
				19,355,849
Diversified Financials 6.6%
Ameriprise Financial, Inc.		158,400		17,682,192
Berkshire Hathaway, Inc., Class B *		56,000		7,215,600
Capital One Financial Corp.		509,500		37,652,050
Interactive Brokers Group, Inc., Class A		85,500		2,043,450
Lazard Ltd., Class A		325,900		15,333,595
Morgan Stanley		770,200		23,822,286
The Bank of New York Mellon Corp.		380,300		12,880,761
The NASDAQ OMX Group, Inc.		14,000		516,600
Voya Financial, Inc.		39,400		1,394,366
Waddell & Reed Financial, Inc., Class A		152,800		10,306,360
				128,847,260
Energy 15.5%
Baker Hughes, Inc.		127,300		8,898,270
Chevron Corp.		390,500		49,015,560
ConocoPhillips		679,400		50,486,214
Devon Energy Corp.		115,400		8,078,000
EOG Resources, Inc.		207,800		20,364,400
Exxon Mobil Corp.		512,800		52,515,848
Marathon Petroleum Corp.		89,500		8,319,025
Murphy Oil Corp.		175,000		11,100,250
Nabors Industries Ltd.		510,000		13,015,200
Occidental Petroleum Corp.		492,700		47,176,025
Phillips 66		114,200		9,503,724
SM Energy Co.		85,000		6,301,050
Valero Energy Corp.		296,600		16,956,622
				301,730,188
Food & Staples Retailing 0.4%
The Kroger Co.		115,000		5,294,600
Walgreen Co.		47,000		3,191,300
				8,485,900
Food, Beverage & Tobacco 3.7%
Altria Group, Inc.		265,500		10,649,205
Archer-Daniels-Midland Co.		880,300		38,495,519
Bunge Ltd.		10,800		860,220
PepsiCo, Inc.		245,500		21,085,995
The Hillshire Brands Co.		48,400		1,725,460
				72,816,399

26 See financial notes

 Schwab Dividend Equity Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Health Care Equipment & Services 5.7%
Aetna, Inc.		210,600		15,047,370
C.R. Bard, Inc.		55,800		7,663,014
Cardinal Health, Inc.		488,800		33,976,488
Centene Corp. *		24,300		1,613,520
McKesson Corp.		12,300		2,081,037
Medtronic, Inc.		688,600		40,503,452
St. Jude Medical, Inc.		25,500		1,618,485
Stryker Corp.		104,800		8,148,200
				110,651,566
Household & Personal Products 1.1%
Energizer Holdings, Inc.		69,400		7,751,286
The Procter & Gamble Co.		167,800		13,851,890
				21,603,176
Insurance 6.8%
Aflac, Inc.		194,200		12,180,224
Assurant, Inc.		80,900		5,453,469
Axis Capital Holdings Ltd.		61,200		2,799,900
CNO Financial Group, Inc.		989,100		17,061,975
Genworth Financial, Inc., Class A *		299,700		5,349,645
MetLife, Inc.		400,900		20,987,115
Old Republic International Corp.		905,100		14,988,456
Protective Life Corp.		169,800		8,685,270
Prudential Financial, Inc.		274,800		22,170,864
Reinsurance Group of America, Inc.		40,300		3,091,413
The Hanover Insurance Group, Inc.		14,000		818,300
The Travelers Cos., Inc.		198,400		17,971,072
Unum Group		30,800		1,023,176
				132,580,879
Materials 4.4%
Ashland, Inc.		14,900		1,439,340
Huntsman Corp.		69,900		1,750,995
International Paper Co.		349,100		16,285,515
PPG Industries, Inc.		18,700		3,620,694
Steel Dynamics, Inc.		1,316,400		24,050,628
The Dow Chemical Co.		787,800		39,311,220
				86,458,392
Media 2.0%
Comcast Corp., Class A		156,600		8,105,616
Live Nation Entertainment, Inc. *		575,600		12,018,528
Time Warner, Inc.		240,500		15,983,630
Viacom, Inc., Class B		38,900		3,305,722
				39,413,496
Pharmaceuticals, Biotechnology & Life Sciences 8.3%
AbbVie, Inc.		268,500		13,983,480
Amgen, Inc.		38,000		4,246,500
Johnson & Johnson		577,400		58,484,846
Merck & Co., Inc.		205,100		12,010,656
Pfizer, Inc.		1,743,400		54,533,552
Salix Pharmaceuticals Ltd. *		162,000		17,820,000
				161,079,034
Real Estate 2.4%
Brandywine Realty Trust		117,700		1,712,535
CBRE Group, Inc., Class A *		276,000		7,352,640
Duke Realty Corp.		699,800		12,260,496
Liberty Property Trust		163,000		6,112,500
Prologis, Inc.		399,200		16,219,496
RLJ Lodging Trust		142,000		3,787,140
				47,444,807
Retailing 2.4%
Best Buy Co., Inc.		338,000		8,764,340
Macy’s, Inc.		533,500		30,638,905
The Home Depot, Inc.		91,900		7,306,969
				46,710,214
Semiconductors & Semiconductor Equipment 0.9%
Intel Corp.		668,700		17,847,603
Software & Services 2.3%
CA, Inc.		279,400		8,421,116
Computer Sciences Corp.		367,100		21,724,978
Oracle Corp.		295,900		12,096,392
Xerox Corp.		290,900		3,516,981
				45,759,467
Technology Hardware & Equipment 5.6%
Cisco Systems, Inc.		896,100		20,708,871
Hewlett-Packard Co.		1,076,400		35,585,784
NetApp, Inc.		421,300		15,002,493
SanDisk Corp.		125,400		10,655,238
Seagate Technology plc		109,400		5,752,252
Western Digital Corp.		246,100		21,688,793
				109,393,431
Telecommunication Services 1.9%
AT&T, Inc.		549,800		19,627,860
Frontier Communications Corp.		1,399,100		8,324,645
Verizon Communications, Inc.		179,500		8,388,035
				36,340,540
Transportation 1.1%
Delta Air Lines, Inc.		327,100		12,047,093
FedEx Corp.		24,100		3,283,625
Southwest Airlines Co.		211,800		5,119,206
				20,449,924
Utilities 7.5%
AES Corp.		1,050,600		15,181,170
Ameren Corp.		511,500		21,130,065
American Electric Power Co., Inc.		453,000		24,375,930
DTE Energy Co.		351,500		27,466,210
Edison International		618,300		34,971,048
Entergy Corp.		175,400		12,716,500

See financial notes 27

 Schwab Dividend Equity Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Public Service Enterprise Group, Inc.		230,600		9,447,682
				145,288,605
Total Common Stock
(Cost $1,536,461,319)				1,924,485,887
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 1.0% of net assets
Time Deposits 1.0%
Citibank
0.03%, 05/01/14		9,576,113		9,576,113
DNB
0.03%, 05/01/14		8,702,403		8,702,403
				18,278,516
U.S. Treasury Obligation 0.0%
U.S. Treasury Bill
0.02%, 06/19/14 (a)(b)		700,000		699,953
Total Short-Term Investments
(Cost $18,978,469)				18,978,469
End of Investments.

At 04/30/14, the tax basis cost of the fund’s investments was $1,555,621,420 and the unrealized appreciation and depreciation were $395,808,479 and ($7,965,543), respectively, with a net unrealized appreciation of $387,842,936.

*	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.

In addition to the above, the fund held the following at 04/30/14:

			Contract		Unrealized
	Number of		Value		Appreciation
	Contracts		($)		($)
Futures Contracts
S&P 500 Index, e-mini, Long, expires 06/20/14		90		8,450,550		171,385

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2014 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Other Significant		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Common Stock1		$1,924,485,887		$—		$—		$1,924,485,887
Short-Term Investments1		—		18,978,469		—		18,978,469
Total		$1,924,485,887		$18,978,469		$—		$1,943,464,356
Other Financial Instruments
Futures Contracts2		$171,385		$—		$—		$171,385

1	As categorized in portfolio holdings.
2	Futures contracts are not included in Investments in the schedule of portfolio holdings 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, 2014.

28 See financial notes

 Schwab Dividend Equity Fund

Statement of

Assets and Liabilities

As of April 30, 2014; unaudited

Assets
Investments, at value (cost $1,555,439,788)		$1,943,464,356
Receivables:
Investments sold		2,721,542
Fund shares sold		2,816,258
Dividends		1,099,875
Variation margin on futures contracts		27,450
Interest		15
Prepaid expenses	+	24,595
Total assets		1,950,154,091
Liabilities
Payables:
Investment adviser and administrator fees		99,435
Shareholder service fees		41,352
Fund shares redeemed		913,029
Accrued expenses	+	80,069
Total liabilities		1,133,885
Net Assets
Total assets		1,950,154,091
Total liabilities	−	1,133,885
Net assets		$1,949,020,206
Net Assets by Source
Capital received from investors		1,437,178,654
Net investment income not yet distributed		612,868
Net realized capital gains		123,032,731
Net unrealized capital appreciation		388,195,953
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$1,949,020,206		107,046,698			$18.21

See financial notes 29

 Schwab Dividend Equity Fund

Statement of

Operations

For the period November 1, 2013 through April 30, 2014; unaudited

Investment Income
Dividends		$22,467,275
Interest	+	2,990
Total investment income		22,470,265
Expenses
Investment adviser and administrator fees		5,734,320
Shareholder service fees		2,269,677
Shareholder reports		51,317
Portfolio accounting fees		37,216
Registration fees		29,678
Professional fees		20,183
Custodian fees		18,074
Transfer agent fees		17,697
Independent trustees’ fees		7,543
Other expenses	+	18,257
Total expenses		8,203,962
Expense reduction by CSIM and its affiliates	−	17,697
Net expenses	−	8,186,265
Net investment income		14,284,000
Realized and Unrealized Gains (Losses)
Net realized gains on investments		122,839,132
Net realized gains on futures contracts	+	1,055,012
Net realized gains		123,894,144
Net change in unrealized appreciation (depreciation) on investments		1,287,169
Net change in unrealized appreciation (depreciation) on futures contracts	+	(173,521	)
Net change in unrealized appreciation (depreciation)	+	1,113,648
Net realized and unrealized gains		125,007,792
Increase in net assets resulting from operations		$139,291,792

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

11/1/13-4/30/14				11/1/12-10/31/13
Net investment income		$14,284,000			$31,081,945
Net realized gains		123,894,144			183,794,300
Net change in unrealized appreciation (depreciation)	+	1,113,648			169,340,491
Increase in net assets from operations		139,291,792			384,216,736
Distributions to Shareholders
Distributions from net investment income		(15,330,941	)		(30,254,415	)
Distributions from net realized gains	+	(118,279,747	)		—
Total distributions		($133,610,688	)		($30,254,415	)

Transactions in Fund Shares

		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		VALUE			SHARES		VALUE
Shares sold			11,007,191		$194,595,805			20,146,686		$334,691,092
Shares reinvested			4,531,336		78,106,280			1,039,729		16,530,353
Shares redeemed	+		(7,477,503	)	(133,003,966	)		(17,942,195	)	(291,824,449	)
Net transactions in fund shares			8,061,024		$139,698,119			3,244,220		$59,396,996
Shares Outstanding and Net Assets
		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			98,985,674		$1,803,640,983			95,741,454		$1,390,281,666
Total increase	+		8,061,024		145,379,223			3,244,220		413,359,317
End of period			107,046,698		$1,949,020,206			98,985,674		$1,803,640,983
Net investment income not yet distributed					$612,868					$1,659,809

See financial notes 31

Schwab Large-Cap Growth Fund™

Financial Statements

Financial Highlights

	11/1/13–			11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–
	4/30/14*			10/31/13			10/31/12			10/31/11			10/31/10			10/31/091
Per-Share Data ($)
Net asset value at beginning of period		15.66			12.48			11.18			10.48			9.10			8.22
Income (loss) from investment operations:
Net investment income (loss)		0.05			0.14			0.07			0.07			0.05			0.05
Net realized and unrealized gains (losses)		1.02			3.17			1.29			0.69			1.39			0.87
Total from investment operations		1.07			3.31			1.36			0.76			1.44			0.92
Less distributions:
Distributions from net investment income		(0.09	)		(0.13	)		(0.06	)		(0.06	)		(0.06	)		(0.04	)
Net asset value at end of period		16.64			15.66			12.48			11.18			10.48			9.10
Total return (%)		6.88	2		26.76			12.18			7.25			15.83			11.36
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		0.99	3		0.99			0.99			0.99			1.00	4		0.99
Gross operating expenses		1.04	3		1.05			1.05			1.05			1.04			1.03
Net investment income (loss)		0.64	3		1.00			0.53			0.56			0.39			0.65
Portfolio turnover rate		41	2		87			79			62			57			63
Net assets, end of period ($ x 1,000,000)		253			253			217			213			219			360

* 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, 2014 (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	.3%	Common Stock		206,470,130		250,916,076
	0	.3%	Short-Term Investment		706,168		706,168
	99	.6%	Total Investments		207,176,298		251,622,244
	0	.4%	Other Assets and Liabilities, Net				1,014,604
	100	.0%	Net Assets				252,636,848

	Number		Value
Security	of Shares		($)
Common Stock 99.3% of net assets
Banks 0.8%
Citigroup, Inc.		42,800		2,050,548
Capital Goods 6.1%
AECOM Technology Corp. *		54,200		1,757,164
Danaher Corp.		4,200		308,196
Exelis, Inc.		35,700		661,878
Honeywell International, Inc.		18,600		1,727,940
IDEX Corp.		10,400		775,528
Masco Corp.		130,400		2,619,736
Northrop Grumman Corp.		3,800		461,738
The Boeing Co.		30,500		3,935,110
United Rentals, Inc. *		33,900		3,180,837
				15,428,127
Commercial & Professional Supplies 1.9%
Manpowergroup, Inc.		28,400		2,310,056
Pitney Bowes, Inc.		55,000		1,474,000
R.R. Donnelley & Sons Co.		60,300		1,061,280
				4,845,336
Consumer Durables & Apparel 1.2%
Deckers Outdoor Corp. *		23,700		1,871,115
Hanesbrands, Inc.		5,100		418,659
Jarden Corp. *		14,500		828,675
				3,118,449
Consumer Services 2.9%
International Game Technology		85,600		1,074,280
MGM Resorts International *		142,100		3,585,183
Wyndham Worldwide Corp.		5,600		399,504
Wynn Resorts Ltd.		11,300		2,303,957
				7,362,924
Diversified Financials 2.7%
Affiliated Managers Group, Inc. *		12,000		2,378,400
Lazard Ltd., Class A		66,100		3,110,005
SEI Investments Co.		40,100		1,298,438
				6,786,843
Energy 4.7%
Baker Hughes, Inc.		14,100		985,590
ConocoPhillips		20,200		1,501,062
EOG Resources, Inc.		58,000		5,684,000
SM Energy Co.		49,500		3,669,435
				11,840,087
Food & Staples Retailing 2.8%
Rite Aid Corp. *		87,400		638,020
The Kroger Co.		113,900		5,243,956
Walgreen Co.		18,000		1,222,200
				7,104,176
Food, Beverage & Tobacco 7.7%
Altria Group, Inc.		31,400		1,259,454
Archer-Daniels-Midland Co.		101,500		4,438,595
Dr Pepper Snapple Group, Inc.		17,900		992,018
PepsiCo, Inc.		88,300		7,584,087
Pilgrim’s Pride Corp. *		86,800		1,897,448
The Hillshire Brands Co.		90,800		3,237,020
				19,408,622
Health Care Equipment & Services 6.1%
Align Technology, Inc. *		37,100		1,869,469
Boston Scientific Corp. *		26,900		339,209
C.R. Bard, Inc.		21,700		2,980,061
Cardinal Health, Inc.		62,400		4,337,424
Express Scripts Holding Co. *		10,700		712,406
McKesson Corp.		11,200		1,894,928
Medtronic, Inc.		54,300		3,193,926
				15,327,423
Household & Personal Products 1.0%
Energizer Holdings, Inc.		23,000		2,568,870
Insurance 2.6%
Aflac, Inc.		25,200		1,580,544
CNO Financial Group, Inc.		222,700		3,841,575
Genworth Financial, Inc., Class A *		60,400		1,078,140
				6,500,259
Materials 3.8%
Avery Dennison Corp.		22,200		1,080,252
PPG Industries, Inc.		26,100		5,053,482
Steel Dynamics, Inc.		36,100		659,547
The Dow Chemical Co.		55,400		2,764,460
				9,557,741

See financial notes 33

 Schwab Large-Cap Growth Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Media 5.0%
Comcast Corp., Class A		100,000		5,176,000
Live Nation Entertainment, Inc. *		176,500		3,685,320
Starz, Class A *		50,100		1,616,727
Viacom, Inc., Class B		26,400		2,243,472
				12,721,519
Pharmaceuticals, Biotechnology & Life Sciences 8.9%
AbbVie, Inc.		61,900		3,223,752
Alkermes plc *		25,100		1,161,126
Amgen, Inc.		45,300		5,062,275
Biogen Idec, Inc. *		5,100		1,464,312
Celgene Corp. *		34,900		5,130,649
Johnson & Johnson		13,900		1,407,931
Pfizer, Inc.		27,300		853,944
Salix Pharmaceuticals Ltd. *		23,000		2,530,000
United Therapeutics Corp. *		17,500		1,750,175
				22,584,164
Real Estate 2.4%
CBRE Group, Inc., Class A *		21,400		570,096
Hospitality Properties Trust		141,000		4,237,050
RLJ Lodging Trust		49,400		1,317,498
				6,124,644
Retailing 7.5%
Amazon.com, Inc. *		3,400		1,034,042
Best Buy Co., Inc.		46,800		1,213,524
GameStop Corp., Class A		23,900		948,352
Macy’s, Inc.		86,400		4,961,952
Netflix, Inc. *		1,000		322,040
The Gap, Inc.		42,600		1,674,180
The Home Depot, Inc.		60,800		4,834,208
The TJX Cos., Inc.		67,500		3,927,150
				18,915,448
Semiconductors & Semiconductor Equipment 0.2%
Freescale Semiconductor Ltd. *		9,600		210,912
Micron Technology, Inc. *		6,200		161,944
Xilinx, Inc.		3,200		151,008
				523,864
Software & Services 16.9%
CA, Inc.		56,200		1,693,868
Computer Sciences Corp.		55,800		3,302,244
CoStar Group, Inc. *		3,500		563,115
DST Systems, Inc.		2,700		248,913
Facebook, Inc., Class A *		44,500		2,660,210
Global Payments, Inc.		49,800		3,328,134
Google, Inc., Class A *		6,100		3,262,768
Google, Inc., Class C *		6,100		3,212,626
IAC/InterActiveCorp		4,600		304,888
Jack Henry & Associates, Inc.		21,800		1,202,488
MasterCard, Inc., Class A		31,200		2,294,760
Microsoft Corp.		182,700		7,381,080
Oracle Corp.		203,500		8,319,080
PTC, Inc. *		130,400		4,612,248
Xerox Corp.		32,800		396,552
				42,782,974
Technology Hardware & Equipment 7.5%
Apple, Inc.		18,567		10,956,201
ARRIS Group, Inc. *		44,200		1,153,178
CDW Corp.		20,500		577,895
Hewlett-Packard Co.		71,300		2,357,178
NetApp, Inc.		101,300		3,607,293
Western Digital Corp.		4,400		387,772
				19,039,517
Telecommunication Services 1.5%
Verizon Communications, Inc.		78,700		3,677,651
Transportation 4.4%
Alaska Air Group, Inc.		40,800		3,838,464
AMERCO		4,500		1,125,495
Matson, Inc.		27,900		660,951
United Parcel Service, Inc., Class B		54,800		5,397,800
				11,022,710
Utilities 0.7%
AES Corp.		112,400		1,624,180
Total Common Stock
(Cost $206,470,130)				250,916,076
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investment 0.3% of net assets
Time Deposit 0.3%
Bank of Tokyo Mitsubishi
0.03%, 05/01/14		706,168		706,168
Total Short-Term Investment
(Cost $706,168)				706,168
End of Investments.

At 04/30/14, the tax basis cost of the fund’s investments was $207,176,298 and the unrealized appreciation and depreciation were $47,696,128 and ($3,250,182), respectively, with a net unrealized appreciation of $44,445,946.

* Non-income producing security.

34 See financial notes

 Schwab Large-Cap Growth Fund

Portfolio Holdings (Unaudited) continued

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2014 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Other Significant		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Common Stock1		$250,916,076		$—		$—		$250,916,076
Short-Term Investment1		—		706,168		—		706,168
Total		$250,916,076		$706,168		$—		$251,622,244

¹ As categorized in portfolio holdings.

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, 2014.

See financial notes 35

 Schwab Large-Cap Growth Fund

Statement of

Assets and Liabilities

As of April 30, 2014; unaudited

Assets
Investments, at value (cost $207,176,298)		$251,622,244
Receivables:
Investments sold		907,181
Dividends		159,005
Fund shares sold		101,621
Income from securities on loan		144
Interest		1
Prepaid expenses	+	6,249
Total assets		252,796,445
Liabilities
Payables:
Investment adviser and administrator fees		13,941
Shareholder service fees		5,489
Fund shares redeemed		83,854
Accrued expenses	+	56,313
Total liabilities		159,597
Net Assets
Total assets		252,796,445
Total liabilities	−	159,597
Net assets		$252,636,848
Net Assets by Source
Capital received from investors		202,974,419
Net investment income not yet distributed		303,591
Net realized capital gains		4,912,892
Net unrealized capital appreciation		44,445,946
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$252,636,848		15,186,169			$16.64

36 See financial notes

 Schwab Large-Cap Growth Fund

Statement of

Operations

For the period November 1, 2013 through April 30, 2014; unaudited

Investment Income
Dividends		$2,059,499
Interest		152
Securities on loan	+	1,463
Total investment income		2,061,114
Expenses
Investment adviser and administrator fees		913,212
Shareholder service fees		312,227
Shareholder reports		22,504
Portfolio accounting fees		20,504
Professional fees		19,412
Transfer agent fees		13,124
Registration fees		11,482
Custodian fees		5,019
Independent trustees’ fees		3,619
Interest expense		20
Other expenses	+	3,064
Total expenses		1,324,187
Expense reduction by CSIM and its affiliates	−	68,501
Net expenses	−	1,255,686
Net investment income		805,428
Realized and Unrealized Gains (Losses)
Net realized gains on investments		19,056,734
Net realized gains on futures contracts	+	77,841
Net realized gains		19,134,575
Net change in unrealized appreciation (depreciation) on investments		(2,871,296	)
Net change in unrealized appreciation (depreciation) on futures contracts	+	(54,459	)
Net change in unrealized appreciation (depreciation)	+	(2,925,755	)
Net realized and unrealized gains		16,208,820
Increase in net assets resulting from operations		$17,014,248

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

11/1/13-4/30/14				11/1/12-10/31/13
Net investment income		$805,428			$2,316,395
Net realized gains		19,134,575			31,663,612
Net change in unrealized appreciation (depreciation)	+	(2,925,755	)		21,399,074
Increase in net assets from operations		17,014,248			55,379,081
Distributions to Shareholders
Distributions from net investment income		($1,490,864	)		($2,200,707	)

Transactions in Fund Shares

		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		VALUE			SHARES		VALUE
Shares sold			710,460		$11,583,658			1,838,655		$25,057,674
Shares reinvested			49,885		793,166			94,231		1,176,943
Shares redeemed	+		(1,710,044	)	(27,947,564	)		(3,195,045	)	(43,826,509	)
Net transactions in fund shares			(949,699	)	($15,570,740	)		(1,262,159	)	($17,591,892	)
Shares Outstanding and Net Assets
		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			16,135,868		$252,684,204			17,398,027		$217,097,722
Total increase or decrease	+		(949,699	)	(47,356	)		(1,262,159	)	35,586,482
End of period			15,186,169		$252,636,848			16,135,868		$252,684,204
Net investment income not yet distributed					$303,591					$989,027

38 See financial notes

Schwab Small-Cap Equity Fund™

Financial Statements

Financial Highlights

	11/1/13–			11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–
	4/30/14*			10/31/13			10/31/12			10/31/11			10/31/10			10/31/091
Per-Share Data ($)
Net asset value at beginning of period		24.87			17.72			15.61			13.96			11.14			10.55
Income (loss) from investment operations:
Net investment income (loss)		0.06			0.09			0.02			(0.01	)		(0.04	)		(0.02	)
Net realized and unrealized gains (losses)		1.59			7.16			2.10			1.66			2.86			0.61
Total from investment operations		1.65			7.25			2.12			1.65			2.82			0.59
Less distributions:
Distributions from net investment income		(0.07	)		(0.10	)		(0.01	)		—			—			(0.00	)2
Distributions from net realized gains		(2.38	)		—			—			—			—			—
Total distributions		(2.45	)		(0.10	)		(0.01	)		—			—			(0.00	)2
Net asset value at end of period		24.07			24.87			17.72			15.61			13.96			11.14
Total return (%)		7.05	3		41.10			13.57			11.82			25.31			5.65
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		1.09	4		1.10			1.12			1.11			1.12			1.12
Gross operating expenses		1.10	4		1.11			1.12			1.12			1.14			1.17
Net investment income (loss)		0.40	4		0.42			0.11			(0.05	)		(0.26	)		(0.16	)
Portfolio turnover rate		51	3		84			101			72			64			85
Net assets, end of period ($ x 1,000,000)		630			590			388			226			219			202

* 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.

See financial notes 39

 Schwab Small-Cap Equity Fund

Portfolio Holdings as of April 30, 2014 (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	.2%	Common Stock		520,195,001		619,108,604
	1	.5%	Short-Term Investments		9,579,028		9,579,028
	99	.7%	Total Investments		529,774,029		628,687,632
	1	.6%	Collateral Invested for Securities on Loan		10,084,242		10,084,242
	(1	.3%)	Other Assets and Liabilities, Net				(8,284,575	)
	100	.0%	Net Assets				630,487,299

	Number		Value
Security	of Shares		($)
Common Stock 98.2% of net assets
Automobiles & Components 1.0%
Dana Holding Corp.		142,578		3,018,376
Tower International, Inc. *		126,230		3,510,457
				6,528,833
Banks 5.3%
1st Source Corp.		31,910		941,026
BancFirst Corp.		15,900		925,539
BBCN Bancorp, Inc.		68,230		1,051,424
Berkshire Hills Bancorp, Inc.		11,300		264,759
Chemical Financial Corp.		45,700		1,282,799
Community Trust Bancorp, Inc.		7,880		290,536
First Bancorp		17,290		297,561
First BanCorp *		108,300		556,662
First Citizens BancShares, Inc., Class A		1,510		339,584
First Defiance Financial Corp.		17,200		464,744
First Interstate Bancsystem, Inc.		28,960		720,814
First Midwest Bancorp, Inc.		239,330		3,917,832
Flushing Financial Corp.		5,990		115,128
International Bancshares Corp.		39,690		911,282
MainSource Financial Group, Inc.		23,100		381,843
Pinnacle Financial Partners, Inc.		22,910		791,999
PrivateBancorp, Inc.		170,810		4,709,232
S&T Bancorp, Inc.		36,980		860,155
Susquehanna Bancshares, Inc.		276,700		2,866,612
Synovus Financial Corp.		1,025,100		3,290,571
TCF Financial Corp.		269,590		4,232,563
The Bank of Kentucky Financial Corp.		7,000		241,570
UMB Financial Corp.		8,390		492,577
WesBanco, Inc.		27,180		821,923
Western Alliance Bancorp *		82,500		1,903,275
WSFS Financial Corp.		9,120		616,694
				33,288,704
Capital Goods 7.6%
AAR Corp.		153,500		3,975,650
Aceto Corp.		106,600		2,332,408
AECOM Technology Corp. *		125,840		4,079,733
Aircastle Ltd.		34,600		607,922
Albany International Corp., Class A		94,940		3,415,941
Altra Industrial Motion Corp.		20,400		696,864
Argan, Inc.		8,230		220,317
Briggs & Stratton Corp.		12,690		271,185
CIRCOR International, Inc.		5,930		481,575
Curtiss-Wright Corp.		48,640		3,110,042
Engility Holdings, Inc. *		15,010		655,037
Esterline Technologies Corp. *		20,860		2,274,157
Gibraltar Industries, Inc. *		64,900		1,108,492
Griffon Corp.		47,200		502,208
Harsco Corp.		128,980		3,086,492
Huntington Ingalls Industries, Inc.		25,260		2,601,780
Hurco Cos., Inc.		9,200		245,272
Hyster-Yale Materials Handling, Inc.		20,500		1,975,995
John Bean Technologies Corp.		74,380		2,156,276
Kadant, Inc.		20,540		713,765
L.B. Foster Co., Class A		16,000		757,600
Lydall, Inc. *		45,320		1,060,941
Moog, Inc., Class A *		42,800		2,801,260
Mueller Water Products, Inc., Class A		228,600		2,084,832
Standex International Corp.		23,160		1,375,009
The Greenbrier Cos., Inc. *		60,180		3,155,839
Tutor Perini Corp. *		51,420		1,522,032
Xerium Technologies, Inc. *		24,820		335,070
				47,603,694
Commercial & Professional Supplies 3.2%
ARC Document Solutions, Inc. *		30,710		196,544
EnerNOC, Inc. *		149,570		3,529,852
Heidrick & Struggles International, Inc.		19,100		360,035
Kelly Services, Inc., Class A		10,532		221,804
Kimball International, Inc., Class B		12,000		201,120
Quad Graphics, Inc.		138,150		2,990,947
RPX Corp. *		286,280		4,689,266
Steelcase, Inc., Class A		199,840		3,293,363
The Brink’s Co.		160,700		4,088,208
TrueBlue, Inc. *		6,550		175,213
Viad Corp.		24,390		562,190
				20,308,542
Consumer Durables & Apparel 2.1%
Blyth, Inc. (a)		25,750		241,278
Cavco Industries, Inc. *		5,900		459,905
CSS Industries, Inc.		20,620		494,261
Culp, Inc.		12,400		223,820
Deckers Outdoor Corp. *		39,990		3,157,211
Johnson Outdoors, Inc., Class A		7,100		148,603
La-Z-Boy, Inc.		43,580		1,055,943

40 See financial notes

 Schwab Small-Cap Equity Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Skechers U.S.A., Inc., Class A *		114,130		4,678,189
Unifi, Inc. *		24,000		531,360
Universal Electronics, Inc. *		51,000		1,904,850
				12,895,420
Consumer Services 2.6%
Ascent Capital Group, Inc., Class A *		34,720		2,387,695
Boyd Gaming Corp. *		259,160		3,063,271
Capella Education Co.		31,740		1,852,346
Jack in the Box, Inc. *		28,140		1,506,616
K12, Inc. *		14,130		334,598
Multimedia Games Holding Co., Inc. *		57,350		1,674,620
Penn National Gaming, Inc. *		324,080		3,616,733
Ruth’s Hospitality Group, Inc.		70,095		882,496
Strayer Education, Inc. *		12,680		540,548
Universal Technical Institute, Inc.		51,590		619,596
				16,478,519
Diversified Financials 2.9%
Calamos Asset Management, Inc., Class A		180,550		2,199,099
Compass Diversified Holdings		52,490		970,540
Evercore Partners, Inc., Class A		35,020		1,871,119
FBR & Co. *		49,640		1,280,712
FXCM, Inc., Class A		39,700		614,556
GFI Group, Inc.		83,720		311,438
Interactive Brokers Group, Inc., Class A		194,780		4,655,242
Investment Technology Group, Inc. *		145,387		3,000,788
Manning & Napier, Inc.		24,210		402,370
Nelnet, Inc., Class A		54,400		2,298,944
Oppenheimer Holdings, Inc., Class A		20,120		512,255
				18,117,063
Energy 7.5%
Basic Energy Services, Inc. *		69,840		1,845,173
Bill Barrett Corp. *		88,980		2,107,046
Bonanza Creek Energy, Inc. *		62,530		3,040,209
Carrizo Oil & Gas, Inc. *		78,030		4,293,210
Clayton Williams Energy, Inc. *		21,630		3,125,102
Cloud Peak Energy, Inc. *		50,910		1,002,418
Contango Oil & Gas Co. *		30,500		1,465,220
Dawson Geophysical Co.		25,560		722,326
Endeavour International Corp. *(a)		163,383		562,037
Green Plains Renewable Energy, Inc.		109,866		3,284,993
Hercules Offshore, Inc. *		175,600		784,932
ION Geophysical Corp. *		270,310		1,189,364
Matrix Service Co. *		108,310		3,354,361
Parker Drilling Co. *		357,390		2,369,496
Penn Virginia Corp. *		12,680		210,995
REX American Resources Corp. *		42,790		2,796,754
SandRidge Energy, Inc. *(a)		107,259		735,797
Stone Energy Corp. *		147,680		7,243,704
VAALCO Energy, Inc. *		228,730		2,108,891
W&T Offshore, Inc.		145,450		2,792,640
Warren Resources, Inc. *		482,410		2,445,819
				47,480,487
Food & Staples Retailing 2.4%
Liberator Medical Holdings, Inc. (a)		91,740		355,034
Rite Aid Corp. *		689,890		5,036,197
Roundy’s, Inc.		337,390		2,284,130
The Andersons, Inc.		88,770		5,529,483
The Pantry, Inc. *		127,210		1,913,239
				15,118,083
Food, Beverage & Tobacco 1.4%
Coca-Cola Bottling Co. Consolidated		25,810		2,122,356
Diamond Foods, Inc. *		18,740		572,882
Farmer Bros. Co. *		73,501		1,448,705
Omega Protein Corp. *		169,040		1,920,294
Pilgrim’s Pride Corp. *		113,800		2,487,668
Seneca Foods Corp., Class A *		7,100		201,640
				8,753,545
Health Care Equipment & Services 6.9%
Alere, Inc. *		54,694		1,826,780
Align Technology, Inc. *		32,160		1,620,542
Alliance HealthCare Services, Inc. *		8,250		234,795
AMN Healthcare Services, Inc. *		38,800		484,224
Amsurg Corp. *		4,940		213,951
AngioDynamics, Inc. *		56,030		753,043
Anika Therapeutics, Inc. *		67,230		2,873,410
Cantel Medical Corp.		51,125		1,695,305
CONMED Corp.		93,580		4,335,562
CryoLife, Inc.		46,100		418,588
Globus Medical, Inc., Class A *		24,650		601,953
Greatbatch, Inc. *		76,634		3,527,463
ICU Medical, Inc. *		34,010		1,897,078
Kindred Healthcare, Inc.		121,430		3,047,893
Magellan Health Services, Inc. *		25,700		1,483,404
MedAssets, Inc. *		9,680		220,994
Merge Healthcare, Inc. *		172,620		393,574
National Healthcare Corp.		11,100		607,503
NuVasive, Inc. *		90,270		3,043,002
Omnicell, Inc. *		21,500		569,320
PharMerica Corp. *		63,480		1,726,021
Quality Systems, Inc.		42,218		623,560
SurModics, Inc. *		75,440		1,641,574
Symmetry Medical, Inc. *		159,160		1,314,662
The Providence Service Corp. *		26,630		1,081,444
Thoratec Corp. *		75,480		2,474,235
Triple-S Management Corp., Class B *		49,790		745,854
VCA Antech, Inc. *		125,540		3,845,290
				43,301,024
Household & Personal Products 0.6%
Harbinger Group, Inc. *		101,300		1,181,158
Revlon, Inc., Class A *		17,300		521,422
Spectrum Brands Holdings, Inc.		17,390		1,336,074
USANA Health Sciences, Inc. *		6,660		451,947
				3,490,601

See financial notes 41

 Schwab Small-Cap Equity Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Insurance 5.6%
American Equity Investment Life Holding Co.		240,470		5,607,761
Aspen Insurance Holdings Ltd.		110,820		5,073,340
CNO Financial Group, Inc.		323,920		5,587,620
FBL Financial Group, Inc., Class A		19,600		876,316
MBIA, Inc. *		163,820		1,985,498
Selective Insurance Group, Inc.		156,930		3,599,974
StanCorp Financial Group, Inc.		48,990		2,993,289
Symetra Financial Corp.		256,600		5,301,356
The Hanover Insurance Group, Inc.		73,920		4,320,624
United Insurance Holdings Corp.		8,660		132,065
				35,477,843
Materials 5.2%
Ampco-Pittsburgh Corp.		21,250		425,638
Calgon Carbon Corp. *		49,380		989,081
Commercial Metals Co.		302,430		5,806,656
Ferro Corp. *		55,050		714,549
Globe Specialty Metals, Inc.		103,068		1,997,458
Handy & Harman Ltd. *		8,300		187,663
KapStone Paper & Packaging Corp. *		27,970		737,849
Materion Corp.		101,110		3,402,352
Minerals Technologies, Inc.		84,360		5,018,576
Neenah Paper, Inc.		64,660		3,256,924
OM Group, Inc.		56,400		1,651,956
OMNOVA Solutions, Inc. *		26,600		242,592
P.H. Glatfelter Co.		69,300		1,768,536
Schweitzer-Mauduit International, Inc.		9,860		430,290
Tredegar Corp.		49,540		1,030,927
Worthington Industries, Inc.		138,884		5,110,931
				32,771,978
Media 0.7%
AH Belo Corp., Class A		48,000		552,480
Cumulus Media, Inc., Class A *		111,300		713,433
Live Nation Entertainment, Inc. *		160,130		3,343,514
				4,609,427
Pharmaceuticals, Biotechnology & Life Sciences 8.9%
Affymetrix, Inc. *		199,740		1,484,068
Akorn, Inc. *		96,150		2,424,903
Albany Molecular Research, Inc. *		17,320		278,159
AMAG Pharmaceuticals, Inc. *		81,830		1,494,216
Anacor Pharmaceuticals, Inc. *		77,680		1,279,390
Arena Pharmaceuticals, Inc. *(a)		152,710		977,344
Bio-Rad Laboratories, Inc., Class A *		31,770		3,914,382
Biospecifics Technologies Corp. *		16,700		396,291
Charles River Laboratories International, Inc. *		68,670		3,688,952
Depomed, Inc. *		74,390		1,042,204
Dyax Corp. *		405,230		2,678,570
Emergent Biosolutions, Inc. *		201,545		5,312,726
Enzo Biochem, Inc. *		64,360		270,312
ICON plc *		96,170		3,728,511
Impax Laboratories, Inc. *		211,750		5,537,262
Insys Therapeutics, Inc. *		21,315		875,194
Maxygen, Inc. *(e)		67,800		—
Myriad Genetics, Inc. *(a)		33,150		1,399,262
Nektar Therapeutics *		127,840		1,504,677
NPS Pharmaceuticals, Inc. *		72,000		1,916,640
PAREXEL International Corp. *		22,840		1,035,794
PDL BioPharma, Inc. (a)		215,220		1,827,218
Prestige Brands Holdings, Inc. *		136,910		4,589,223
Repligen Corp. *		103,380		1,638,573
Sagent Pharmaceuticals, Inc. *		88,470		1,830,444
Spectrum Pharmaceuticals, Inc. *		33,420		229,595
The Medicines Co. *		105,710		2,811,886
Threshold Pharmaceuticals, Inc. *		440,975		1,807,998
XOMA Corp. *		59,730		265,201
				56,238,995
Real Estate 6.2%
Ashford Hospitality Trust, Inc.		531,973		5,458,043
Brandywine Realty Trust		311,810		4,536,836
Cedar Realty Trust, Inc.		92,410		572,018
CyrusOne, Inc.		84,060		1,681,200
DCT Industrial Trust, Inc.		500,000		3,910,000
DiamondRock Hospitality Co.		153,760		1,886,635
DuPont Fabros Technology, Inc.		75,820		1,837,119
Pebblebrook Hotel Trust		59,410		2,046,080
PS Business Parks, Inc.		42,600		3,653,802
RLJ Lodging Trust		213,960		5,706,313
Saul Centers, Inc.		33,860		1,553,835
Strategic Hotels & Resorts, Inc. *		341,320		3,682,843
Sunstone Hotel Investors, Inc.		174,440		2,496,236
				39,020,960
Retailing 4.5%
ANN, Inc. *		80,150		3,141,079
Brown Shoe Co., Inc.		180,380		4,255,164
Citi Trends, Inc. *		103,430		1,757,276
Core-Mark Holding Co., Inc.		14,637		1,178,864
Destination Maternity Corp.		9,280		228,845
Guess?, Inc.		150,150		4,040,536
Haverty Furniture Cos, Inc.		62,900		1,606,466
New York & Co., Inc. *		82,500		345,675
Outerwall, Inc. *(a)		69,500		4,819,825
Overstock.com, Inc. *		84,190		1,348,724
Stein Mart, Inc.		22,960		287,000
The Children’s Place Retail Stores, Inc.		77,660		3,727,680
The Pep Boys - Manny, Moe & Jack *		133,720		1,366,618
				28,103,752
Semiconductors & Semiconductor Equipment 4.2%
Amkor Technology, Inc. *		435,090		3,458,965
Axcelis Technologies, Inc. *		164,310		294,115
Cabot Microelectronics Corp. *		73,240		3,176,419
Diodes, Inc. *		93,963		2,477,804
DSP Group, Inc. *		26,000		206,960
FormFactor, Inc. *		195,390		1,123,493
International Rectifier Corp. *		226,866		5,907,591
IXYS Corp.		54,900		592,371
OmniVision Technologies, Inc. *		255,070		4,981,517

42 See financial notes

 Schwab Small-Cap Equity Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Pericom Semiconductor Corp. *		51,100		412,377
Photronics, Inc. *		278,950		2,421,286
Power Integrations, Inc.		13,660		645,162
Sigma Designs, Inc. *		69,100		260,507
Ultra Clean Holdings, Inc. *		64,000		545,280
				26,503,847
Software & Services 9.7%
Aspen Technology, Inc. *		142,940		6,144,990
Callidus Software, Inc. *		174,780		1,668,275
comScore, Inc. *		165,100		5,172,583
Comverse, Inc. *		51,980		1,296,381
Constant Contact, Inc. *		125,560		3,246,982
CSG Systems International, Inc.		103,070		2,716,925
Epiq Systems, Inc.		62,730		802,317
Euronet Worldwide, Inc. *		21,830		1,003,962
Intralinks Holdings, Inc. *		164,920		1,509,018
j2 Global, Inc.		71,230		3,302,223
Limelight Networks, Inc. *		341,210		706,305
Mentor Graphics Corp.		31,430		650,601
MoneyGram International, Inc. *		64,434		850,529
Monster Worldwide, Inc. *		140,440		967,632
Pegasystems, Inc.		158,780		2,630,985
PTC, Inc. *		164,460		5,816,950
QuinStreet, Inc. *		63,370		386,557
Rosetta Stone, Inc. *		33,360		397,318
Rovi Corp. *		42,410		945,319
Seachange International, Inc. *		195,090		1,827,993
SS&C Technologies Holdings, Inc. *		40,750		1,585,990
Sykes Enterprises, Inc. *		30,300		599,637
Take-Two Interactive Software, Inc. *		270,960		5,522,165
TeleCommunication Systems, Inc., Class A *		59,240		151,062
TeleTech Holdings, Inc. *		62,910		1,518,018
Unisys Corp. *		59,920		1,460,250
Verint Systems, Inc. *		113,420		4,964,393
Web.com Group, Inc. *		114,940		3,529,807
				61,375,167
Technology Hardware & Equipment 5.2%
ARRIS Group, Inc. *		235,020		6,131,672
Benchmark Electronics, Inc. *		131,730		3,053,501
Brocade Communications Systems, Inc. *		474,900		4,421,319
Calix, Inc. *		56,870		501,025
Checkpoint Systems, Inc. *		84,800		1,082,896
Daktronics, Inc.		52,700		686,154
Emulex Corp. *		22,650		161,948
Harmonic, Inc. *		568,410		3,995,922
II-VI, Inc. *		196,560		2,830,464
Immersion Corp. *		26,740		303,232
Insight Enterprises, Inc. *		95,400		2,491,848
Newport Corp. *		89,440		1,670,739
Plexus Corp. *		36,200		1,517,504
Richardson Electronics Ltd.		16,310		163,426
ScanSource, Inc. *		3,330		127,905
Tech Data Corp. *		38,280		2,392,117
TTM Technologies, Inc. *		92,860		732,665
Vishay Intertechnology, Inc.		51,890		737,876
				33,002,213
Telecommunication Services 1.1%
IDT Corp., Class B		111,250		1,762,200
Inteliquent, Inc.		171,257		2,335,945
Premiere Global Services, Inc. *		127,360		1,620,019
Shenandoah Telecommunications Co.		8,300		232,649
Telephone & Data Systems, Inc.		36,720		998,417
USA Mobility, Inc.		12,997		222,639
				7,171,869
Transportation 2.3%
AMERCO		17,040		4,261,875
ArcBest Corp.		86,020		3,390,908
Hawaiian Holdings, Inc. *		44,080		636,956
Matson, Inc.		15,740		372,881
Park-Ohio Holdings Corp. *		25,860		1,509,965
Republic Airways Holdings, Inc. *		52,900		439,599
SkyWest, Inc.		328,960		3,815,936
				14,428,120
Utilities 1.1%
Avista Corp.		53,460		1,718,739
Chesapeake Utilities Corp.		10,700		676,882
PNM Resources, Inc.		118,320		3,275,098
Southwest Gas Corp.		24,890		1,369,199
				7,039,918
Total Common Stock
(Cost $520,195,001)				619,108,604
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 1.5% of net assets
Time Deposits 1.4%
DNB
0.03%, 05/01/14		9,029,060		9,029,060
U.S. Treasury Obligations 0.1%
U.S. Treasury Bills
0.04%, 06/19/14 (b)(c)		380,000		379,979
0.05%, 06/19/14 (b)(c)		170,000		169,989
				549,968
Total Short-Term Investments
(Cost $9,579,028)				9,579,028
End of Investments.

See financial notes 43

 Schwab Small-Cap Equity Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Collateral Invested for Securities on Loan 1.6% of net assets
Wells Fargo Advantage Government Money Market Fund, Institutional Class 0.01% (d)		10,084,242		10,084,242
Total Collateral Invested for Securities on Loan
(Cost $10,084,242)				10,084,242
End of Collateral Invested for Securities on Loan

At 04/30/14, the tax basis cost of the fund’s investments was $530,390,113 and the unrealized appreciation and depreciation were $117,308,041 and ($19,010,522), respectively, with a net unrealized appreciation of $98,297,519

*	Non-income producing security.
(a)	All or a portion of this security is on loan. Securities on loan were valued at $9,955,597.
(b)	All or a portion of this security is held as collateral for open futures contracts.
(c)	The rate shown is the purchase yield.
(d)	The rate shown is the 7-day yield.
(e)	Fair-valued by management in accordance with procedures approved by the Board of Trustees.

In addition to the above, the fund held the following at 4/30/14:

			Contract		Unrealized
	Number of		Value		Depreciation
	Contracts		($)		($)
Futures Contracts
Russell 2000 Index, mini, Long, expires 06/20/14		99		11,123,640		(247,014	)

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2014 (see financial note 2(a) for additional information):

Assets Valuation Input

	Quoted Prices in					Significant
	Active Markets for			Other Significant		Unobservable
	Identical Assets			Observable Inputs		Inputs
Description	(Level 1)			(Level 2)		(Level 3)		Total
Common Stock1		$619,108,604			$—		$—		$619,108,604
Short-Term Investments1		—			9,579,028		—		9,579,028
Total		$619,108,604			$9,579,028		$—		$628,687,632
Other Financial Instruments
Collateral Invested for Securities on Loan		$10,084,242			$—		$—		$10,084,242
Liabilities Valuation Input
Other Financial Instruments
Futures Contracts2		($247,014	)		$—		$—		($247,014	)

1	As categorized in portfolio holdings.
2	Futures contracts are not included in Investments in the schedule of portfolio holdings 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, 2014.

44 See financial notes

 Schwab Small-Cap Equity Fund

Statement of

Assets and Liabilities

As of April 30, 2014; unaudited

Assets
Investments, at value (cost $529,774,029) including securities on loan of $9,955,597		$628,687,632
Collateral invested for securities on loan		10,084,242
Receivables:
Investments sold		15,115,154
Fund shares sold		4,706,241
Dividends		122,201
Income from securities on loan		41,172
Variation margin on futures contracts		28,625
Interest		8
Prepaid expenses	+	3,493
Total assets		658,788,768
Liabilities
Collateral held for securities on loan		10,084,242
Payables:
Investments bought		17,936,041
Investment adviser and administrator fees		41,601
Shareholder service fees		14,054
Fund shares redeemed		177,911
Accrued expenses	+	47,620
Total liabilities		28,301,469
Net Assets
Total assets		658,788,768
Total liabilities	−	28,301,469
Net assets		$630,487,299
Net Assets by Source
Capital received from investors		464,044,380
Distributions in excess of net investment income		(485,586	)
Net realized capital gains		68,261,916
Net unrealized capital appreciation		98,666,589
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$630,487,299		26,195,326			$24.07

See financial notes 45

 Schwab Small-Cap Equity Fund

Statement of

Operations

For the period November 1, 2013 through April 30, 2014; unaudited

Investment Income
Dividends		$4,397,598
Interest		1,577
Securities on loan	+	120,973
Total investment income		4,520,148
Expenses
Investment adviser and administrator fees		2,457,243
Shareholder service fees		747,990
Shareholder reports		26,066
Portfolio accounting fees		25,147
Professional fees		17,458
Registration fees		17,024
Custodian fees		13,359
Transfer agent fees		12,688
Independent trustees’ fees		4,479
Other expenses	+	5,840
Total expenses		3,327,294
Expense reduction by CSIM and its affiliates	−	12,688
Net expenses	−	3,314,606
Net investment income		1,205,542
Realized and Unrealized Gains (Losses)
Net realized gains on investments		68,987,906
Net realized losses on futures contracts	+	(185,839	)
Net realized gains		68,802,067
Net change in unrealized appreciation (depreciation) on investments		(28,448,502	)
Net change in unrealized appreciation (depreciation) on futures contracts	+	(360,492	)
Net change in unrealized appreciation (depreciation)	+	(28,808,994	)
Net realized and unrealized gains		39,993,073
Increase in net assets resulting from operations		$41,198,615

46 See financial notes

 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

11/1/13-4/30/14				11/1/12-10/31/13
Net investment income		$1,205,542			$1,994,462
Net realized gains		68,802,067			70,691,514
Net change in unrealized appreciation (depreciation)	+	(28,808,994	)		89,763,924
Increase in net assets from operations		41,198,615			162,449,900
Distributions to Shareholders
Distributions from net investment income		(1,598,911	)		(2,100,800	)
Distributions from net realized gains	+	(56,889,199	)		—
Total distributions		($58,488,110	)		($2,100,800	)

Transactions in Fund Shares

		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		VALUE			SHARES		VALUE
Shares sold			4,516,597		$107,986,703			5,573,116		$121,933,084
Shares reinvested			1,076,328		24,841,650			39,481		707,097
Shares redeemed	+		(3,135,702	)	(75,367,588	)		(3,750,852	)	(80,237,495	)
Net transactions in fund shares			2,457,223		$57,460,765			1,861,745		$42,402,686
Shares Outstanding and Net Assets
		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			23,738,103		$590,316,029			21,876,358		$387,564,243
Total increase	+		2,457,223		40,171,270			1,861,745		202,751,786
End of period			26,195,326		$630,487,299			23,738,103		$590,316,029
Distributions in excess of net investment income					($485,586	)				($92,217	)

See financial notes 47

Schwab Hedged Equity Fund™

Financial Statements

Financial Highlights

	11/1/13–			11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–
	4/30/14*			10/31/13			10/31/12			10/31/11			10/31/10			10/31/091
Per-Share Data ($)
Net asset value at beginning of period		18.62			16.36			15.32			14.79			13.45			12.55
Income (loss) from investment operations:
Net investment income (loss)		(0.04	)		(0.10	)		(0.08	)		(0.05	)		(0.08	)		(0.05	)
Net realized and unrealized gains (losses)		1.04			2.36			1.12			0.58			1.42			0.96
Total from investment operations		1.00			2.26			1.04			0.53			1.34			0.91
Less distributions:
Distributions from net investment income		—			—			—			—			—			(0.01	)
Distributions from net realized gains		(1.51	)		—			—			—			—			—
Total distributions		(1.51	)		—			—			—			—			(0.01	)
Net asset value at end of period		18.11			18.62			16.36			15.32			14.79			13.45
Total return (%)		5.75	2		13.81			6.79			3.58			9.96			7.28
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses (including dividend expense on short sales)		2.12	3		2.48			2.08			1.86			1.97			2.07	4
Net operating expenses (excluding dividend expense on short sales)		1.56	3,5		1.48	5		1.53	5		1.44	6		1.38	7		1.62	4,7
Gross operating expenses		2.16	3		2.52			2.13			1.88			1.99			2.29
Net investment income (loss)		(0.43	)3		(0.49	)		(0.47	)		(0.25	)		(0.54	)		(0.41	)
Portfolio turnover rate		72	2		130			109			98			115			169
Net assets, end of period ($ x 1,000,000)		188			193			194			236			329			306

* 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 1.33% for the period ended 10/31/12, 10/31/13 and 4/30/14, respectively, if stock loan fees on short sales had not been incurred.

⁶ 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.

⁷ 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.

48 See financial notes

 Schwab Hedged Equity Fund

Portfolio Holdings as of April 30, 2014 (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	.3%	Common Stock		149,775,333			184,504,383
	1	.9%	Other Investment Company		3,513,093			3,513,093
	0	.1%	Short-Term Investment		99,997			99,997
	100	.3%	Total Investments		153,388,423			188,117,473
	(38	.5)%	Short Sales		(67,971,627	)		(72,231,605	)
	38	.2%	Other Assets and Liabilities, Net					71,717,527
	100	.0%	Net Assets					187,603,395

	Number		Value
Security	of Shares		($)
Common Stock 98.3% of net assets
Banks 7.9%
Bank of America Corp.		118,400		1,792,576
Citigroup, Inc.		23,700		1,135,467
Fifth Third Bancorp		69,798		1,438,537
Regions Financial Corp. (a)		239,500		2,428,530
SunTrust Banks, Inc.		51,134		1,956,387
The PNC Financial Services Group, Inc. (a)		46,400		3,899,456
Wells Fargo & Co. (a)		45,491		2,258,173
				14,909,126
Capital Goods 5.8%
AAR Corp.		1,500		38,850
AECOM Technology Corp. *		3,200		103,744
Aircastle Ltd.		26,300		462,091
Albany International Corp., Class A		3,900		140,322
Briggs & Stratton Corp.		3,600		76,932
Curtiss-Wright Corp. (a)		39,900		2,551,206
Emerson Electric Co.		22,000		1,499,960
IDEX Corp.		9,400		700,958
Masco Corp.		76,000		1,526,840
MRC Global, Inc. *		6,600		192,654
Northrop Grumman Corp.		14,700		1,786,197
Oshkosh Corp.		1,800		99,918
Terex Corp.		5,300		229,437
United Rentals, Inc. *		16,500		1,548,195
				10,957,304
Commercial & Professional Supplies 2.2%
Pitney Bowes, Inc.		14,400		385,920
R.R. Donnelley & Sons Co.		191,000		3,361,600
Steelcase, Inc., Class A		12,400		204,352
The Brink’s Co.		7,600		193,344
				4,145,216
Consumer Durables & Apparel 0.3%
Hanesbrands, Inc.		2,200		180,598
Jarden Corp. *(a)		7,816		446,684
				627,282
Consumer Services 1.5%
Graham Holdings Co., Class B		1,700		1,141,091
Jack in the Box, Inc. *		16,600		888,764
MGM Resorts International *		23,300		587,859
Penn National Gaming, Inc. *		22,700		253,332
				2,871,046
Diversified Financials 0.9%
Affiliated Managers Group, Inc. *		8,000		1,585,600
Interactive Brokers Group, Inc., Class A		1,200		28,680
Lazard Ltd., Class A		800		37,640
				1,651,920
Energy 11.7%
Chevron Corp. (a)		11,096		1,392,770
ConocoPhillips (a)		56,900		4,228,239
Devon Energy Corp.		1,400		98,000
EOG Resources, Inc. (a)		40,200		3,939,600
Exxon Mobil Corp. (a)		1,978		202,567
Green Plains Renewable Energy, Inc.		6,400		191,360
Marathon Oil Corp.		21,800		788,070
Murphy Oil Corp. (a)		40,553		2,572,277
National Oilwell Varco, Inc.		8,400		659,652
Occidental Petroleum Corp. (a)		41,300		3,954,475
Patterson-UTI Energy, Inc.		24,800		806,744
SM Energy Co.		31,500		2,335,095
Valero Energy Corp.		14,700		840,399
				22,009,248
Food & Staples Retailing 3.0%
Rite Aid Corp. *		52,700		384,710
The Andersons, Inc.		20,700		1,289,403
The Kroger Co. (a)		84,543		3,892,360
				5,566,473
Food, Beverage & Tobacco 5.9%
Altria Group, Inc.		10,600		425,166
Archer-Daniels-Midland Co. (a)		88,200		3,856,986
Bunge Ltd. (a)		41,100		3,273,615
J&J Snack Foods Corp.		8,300		776,880
Pilgrim’s Pride Corp. *		47,200		1,031,792
Tyson Foods, Inc., Class A		40,700		1,708,179
				11,072,618

See financial notes 49

 Schwab Hedged Equity Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Health Care Equipment & Services 5.4%
Alere, Inc. *		16,300		544,420
C.R. Bard, Inc.		7,600		1,043,708
Cardinal Health, Inc.		44,700		3,107,097
CareFusion Corp. *		30,400		1,187,424
Kindred Healthcare, Inc.		3,100		77,810
Magellan Health Services, Inc. *(a)		17,700		1,021,644
Medtronic, Inc. (a)		54,000		3,176,280
				10,158,383
Household & Personal Products 0.7%
Harbinger Group, Inc. *		29,200		340,472
Herbalife Ltd.		7,400		443,852
Nu Skin Enterprises, Inc., Class A		6,900		600,300
				1,384,624
Insurance 5.1%
American Equity Investment Life Holding Co.		84,900		1,979,868
Aspen Insurance Holdings Ltd.		61,800		2,829,204
Assurant, Inc.		11,800		795,438
CNO Financial Group, Inc. (a)		189,000		3,260,250
Reinsurance Group of America, Inc.		8,300		636,693
Symetra Financial Corp.		4,900		101,234
				9,602,687
Materials 4.9%
Ashland, Inc.		6,100		589,260
Commercial Metals Co.		44,900		862,080
Minerals Technologies, Inc. (a)		57,992		3,449,944
PPG Industries, Inc.		6,272		1,214,385
Steel Dynamics, Inc.		53,200		971,964
Worthington Industries, Inc. (a)		56,793		2,089,982
				9,177,615
Media 2.7%
Comcast Corp., Class A		31,200		1,614,912
Live Nation Entertainment, Inc. *		162,300		3,388,824
				5,003,736
Pharmaceuticals, Biotechnology & Life Sciences 5.6%
Amgen, Inc. (a)		19,700		2,201,475
Celgene Corp. *(a)		24,900		3,660,549
Pfizer, Inc. (a)		137,274		4,293,931
Salix Pharmaceuticals Ltd. *		2,400		264,000
				10,419,955
Real Estate 3.4%
Ashford Hospitality Trust, Inc.		40,800		418,608
Brandywine Realty Trust		100,500		1,462,275
CBRE Group, Inc., Class A *		35,000		932,400
EPR Properties		23,000		1,233,030
Hospitality Properties Trust		4,000		120,200
RLJ Lodging Trust		70,700		1,885,569
Select Income REIT		11,400		350,892
				6,402,974
Retailing 5.7%
Aaron’s, Inc.		11,100		327,117
ANN, Inc. *(a)		48,500		1,900,715
Best Buy Co., Inc.		33,300		863,469
Brown Shoe Co., Inc.		9,200		217,028
GameStop Corp., Class A		23,900		948,352
Guess?, Inc.		2,000		53,820
Macy’s, Inc. (a)		65,421		3,757,128
Outerwall, Inc. *		20,600		1,428,610
The Children’s Place Retail Stores, Inc.		24,900		1,195,200
				10,691,439
Semiconductors & Semiconductor Equipment 0.5%
International Rectifier Corp. *		38,200		994,728
Software & Services 10.5%
Aspen Technology, Inc. *		23,900		1,027,461
CA, Inc. (a)		109,906		3,312,567
Computer Sciences Corp.		29,300		1,733,974
comScore, Inc. *		33,300		1,043,289
Google, Inc., Class A *		1,400		748,832
Microsoft Corp. (a)		33,919		1,370,327
MoneyGram International, Inc. *		12,400		163,680
Oracle Corp. (a)		84,300		3,446,184
Pegasystems, Inc.		26,400		437,448
PTC, Inc. *		25,400		898,398
Synopsys, Inc. *		40,700		1,531,134
Take-Two Interactive Software, Inc. *(a)		112,200		2,286,636
TiVo, Inc. *		50,100		594,186
Verint Systems, Inc. *		11,500		503,355
Xerox Corp.		45,300		547,677
				19,645,148
Technology Hardware & Equipment 8.8%
Apple, Inc. (a)		3,428		2,022,829
Brocade Communications Systems, Inc. *(a)		228,524		2,127,559
Cisco Systems, Inc.		1,100		25,421
EchoStar Corp., Class A *(a)		7,567		340,212
Hewlett-Packard Co. (a)		91,436		3,022,874
II-VI, Inc. *		66,000		950,400
NetApp, Inc.		73,800		2,628,018
Western Digital Corp.		25,479		2,245,464
Zebra Technologies Corp., Class A *(a)		44,000		3,055,360
				16,418,137
Telecommunication Services 0.5%
Verizon Communications, Inc.		19,050		890,206
Transportation 1.1%
AMERCO		2,800		700,308
FedEx Corp. (a)		9,292		1,266,035
				1,966,343

50 See financial notes

 Schwab Hedged Equity Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Utilities 4.2%
AES Corp. (a)		242,428		3,503,085
Edison International (a)		44,500		2,516,920
Entergy Corp.		23,100		1,674,750
Vectren Corp.		6,000		243,420
				7,938,175
Total Common Stock
(Cost $149,775,333)				184,504,383
Other Investment Company 1.9% of net assets
Money Market Fund 1.9%
State Street Institutional U.S. Government Money Market Fund, Institutional Class 0.00% (b)		3,513,093		3,513,093
Total Other Investment Company
(Cost $3,513,093)				3,513,093
			��
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investment 0.1% of net assets
U.S. Treasury Obligation 0.1%
U.S. Treasury Bill
0.02%, 06/19/14 (c)(d)		100,000		99,997
Total Short-Term Investment
(Cost $99,997)				99,997
End of Investments.

At 04/30/14, the tax basis cost of the fund’s investments was $153,856,548 and the unrealized appreciation and depreciation were $36,133,218 and ($1,872,293), respectively, with a net unrealized appreciation of $34,260,925.

*	Non-income producing security.
(a)	All or a portion of this security is held as collateral for short sales
(b)	The rate shown is the 7-day yield.
(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

In addition to the above, the fund held the following at 04/30/14:

			Contract		Unrealized
	Number of		Value		Appreciation
	Contracts		($)		($)
Futures Contracts
S&P 500 Index, e-mini, Long, expires 06/20/14		15		1,408,425		29,896

See financial notes 51

 Schwab Hedged Equity Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Short Sales 38.5% of net assets
Automobiles & Components 0.5%
Dorman Products, Inc. *		17,200		989,860
Banks 2.6%
BankUnited, Inc.		17,000		560,830
M&T Bank Corp.		19,500		2,379,195
Signature Bank *		7,200		855,504
Valley National Bancorp		103,835		1,040,427
				4,835,956
Capital Goods 2.3%
Chart Industries, Inc. *		3,600		245,592
DigitalGlobe, Inc. *		11,300		336,514
Fastenal Co.		47,300		2,368,784
Joy Global, Inc.		700		42,266
Navistar International Corp. *		10,300		390,679
Proto Labs, Inc. *		9,280		561,811
SolarCity Corp. *		7,100		378,075
				4,323,721
Commercial & Professional Supplies 1.9%
Copart, Inc. *		32,685		1,185,485
Healthcare Services Group, Inc.		5,100		148,410
Stericycle, Inc. *		11,400		1,327,416
The Advisory Board Co. *		14,400		824,544
				3,485,855
Consumer Durables & Apparel 1.3%
Kate Spade & Co. *		67,300		2,340,021
Consumer Services 0.6%
Caesars Entertainment Corp. *		29,000		535,630
Norwegian Cruise Line Holdings Ltd. *		19,800		648,846
				1,184,476
Diversified Financials 0.7%
Federated Investors, Inc., Class B		41,700		1,190,118
Leucadia National Corp.		6,600		168,432
				1,358,550
Energy 7.8%
Atwood Oceanics, Inc. *		22,900		1,134,924
Cheniere Energy, Inc. *		16,200		914,490
Cobalt International Energy, Inc. *		108,600		1,954,800
CVR Energy, Inc.		7,300		358,795
Diamondback Energy, Inc. *		22,600		1,625,844
Dresser-Rand Group, Inc. *		38,500		2,326,940
Golar LNG Ltd.		40,700		1,798,940
Gulfport Energy Corp. *		8,400		618,828
Kodiak Oil & Gas Corp. *		98,484		1,251,731
McDermott International, Inc. *		82,800		598,644
Oasis Petroleum, Inc. *		900		41,859
Range Resources Corp.		9,000		814,050
Scorpio Tankers, Inc.		40,400		364,004
The Williams Cos., Inc.		19,400		818,098
				14,621,947
Food & Staples Retailing 1.5%
Sprouts Farmers Market, Inc. *		500		15,985
The Fresh Market, Inc. *		15,900		589,890
United Natural Foods, Inc. *		32,900		2,271,087
				2,876,962
Food, Beverage & Tobacco 0.7%
Snyder’s-Lance, Inc.		3,200		84,992
The Hain Celestial Group, Inc. *		14,705		1,264,924
				1,349,916
Health Care Equipment & Services 0.8%
Acadia Healthcare Co., Inc. *		17,306		727,198
athenahealth, Inc. *		700		86,548
Edwards Lifesciences Corp. *		4,200		342,174
Intuitive Surgical, Inc. *		700		253,190
Tenet Healthcare Corp. *		2,700		121,716
				1,530,826
Insurance 2.5%
Fidelity National Financial, Inc., Class A		70,500		2,268,690
Mercury General Corp.		8,900		425,954
RLI Corp.		46,400		1,997,984
				4,692,628
Materials 4.5%
Eagle Materials, Inc.		28,700		2,391,571
FMC Corp.		27,900		2,148,300
Southern Copper Corp.		28,885		870,594
US Silica Holdings, Inc.		32,000		1,445,440
Vulcan Materials Co.		23,400		1,510,002
				8,365,907
Media 1.1%
DreamWorks Animation SKG, Inc., Class A *		39,400		946,782
Loral Space & Communications, Inc. *		5,400		388,746
Sirius XM Holdings, Inc. *		223,300		712,327
				2,047,855
Retailing 2.4%
Cabela’s, Inc. *		22,400		1,469,664
CarMax, Inc. *		52,200		2,285,316
Restoration Hardware Holdings, Inc. *		9,300		580,227
TripAdvisor, Inc. *		2,800		226,072
				4,561,279
Semiconductors & Semiconductor Equipment 0.7%
SunEdison, Inc. *		50,900		978,807
SunPower Corp. *		10,500		350,910
				1,329,717

52 See financial notes

 Schwab Hedged Equity Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Software & Services 2.9%
Concur Technologies, Inc. *		12,500		1,005,875
EPAM Systems, Inc. *		8,500		264,605
NetSuite, Inc. *		13,800		1,066,878
Pandora Media, Inc. *		15,516		363,385
Qlik Technologies, Inc. *		59,200		1,301,216
Rackspace Hosting, Inc. *		25,000		725,500
Teradata Corp. *		4,800		218,208
Yahoo! Inc. *		13,000		467,350
				5,413,017
Technology Hardware & Equipment 1.8%
3D Systems Corp. *		1,100		52,074
IPG Photonics Corp. *		21,000		1,357,230
Palo Alto Networks, Inc. *		6,600		419,628
Stratasys Ltd. *		9,000		871,830
ViaSat, Inc. *		11,100		712,731
				3,413,493
Transportation 1.5%
C.H. Robinson Worldwide, Inc.		42,100		2,479,690
Kansas City Southern		3,900		393,432
				2,873,122
Utilities 0.4%
New Jersey Resources Corp.		1,100		54,703
OGE Energy Corp.		8,200		306,106
SCANA Corp.		4,200		225,456
Westar Energy, Inc.		1,400		50,232
				636,497
Total Short Sales
(Proceeds $67,971,627)				72,231,605
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, 2014 (see financial note 2(a) for additional information):

Assets Valuation Input

	Quoted Prices in					Significant
	Active Markets for			Other Significant		Unobservable
	Identical Assets			Observable Inputs		Inputs
Description	(Level 1)			(Level 2)		(Level 3)		Total
Common Stock1		$184,504,383			$—		$—		$184,504,383
Other Investment Company1		3,513,093			—		—		3,513,093
Short-Term Investment1		—			99,997		—		99,997
Total		$188,017,476			$99,997		$—		$188,117,473
Other Financial Instruments
Futures Contracts2		$29,896			$—		$—		$29,896
Liabilities Valuation Input
Other Financial Instruments
Short Sales1		($72,231,605	)		$—		$—		($72,231,605	)

1	As categorized in portfolio holdings.
2	Futures contracts are not included in Investments in the schedule of portfolio holdings 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, 2014.

See financial notes 53

 Schwab Hedged Equity Fund

Statement of

Assets and Liabilities

As of April 30, 2014; unaudited

Assets
Investments, at value (cost $153,388,423)		$188,117,473
Deposits with broker for short sales		71,913,412
Receivables:
Investments sold		4,430,121
Fund shares sold		71,846
Dividends		64,363
Variation margin on futures contracts		4,575
Prepaid expenses	+	5,627
Total assets		264,607,417
Liabilities
Securities sold short, at value (proceeds $67,971,627)		72,231,605
Payables:
Investments bought		4,669,813
Investment adviser and administrator fees		15,936
Shareholder service fees		4,944
Fund shares redeemed		26,329
Dividends on short sales		16,789
Accrued expenses	+	38,606
Total liabilities		77,004,022
Net Assets
Total assets		264,607,417
Total liabilities	−	77,004,022
Net assets		$187,603,395
Net Assets by Source
Capital received from investors		146,157,836
Net investment loss		(2,106,678	)
Net realized capital gains		13,053,269
Net unrealized capital appreciation		30,498,968
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$187,603,395		10,359,330			$18.11

54 See financial notes

 Schwab Hedged Equity Fund

Statement of

Operations

For the period November 1, 2013 through April 30, 2014; unaudited

Investment Income
Dividends		$1,576,593
Interest	+	7
Total investment income		1,576,600
Expenses
Investment adviser and administrator fees		977,156
Shareholder service fees		214,760
Dividends on short sales		526,748
Stock loan fees on short sales		209,475
Professional fees		22,117
Transfer agent fees		18,394
Registration fees		12,483
Shareholder reports		7,608
Portfolio accounting fees		7,282
Custodian fees		6,226
Independent trustees’ fees		3,462
Interest expense		673
Other expenses	+	2,481
Total expenses		2,008,865
Expense reduction by CSIM and its affiliates	−	34,238
Net expenses	−	1,974,627
Net investment loss		(398,027	)
Realized and Unrealized Gains (Losses)
Net realized gains on investments		23,458,541
Net realized losses on futures contracts		(18,349	)
Net realized losses on short sales	+	(10,324,680	)
Net realized gains		13,115,512
Net change in unrealized appreciation (depreciation) on investments		(10,562,848	)
Net change in unrealized appreciation (depreciation) on futures contracts		29,896
Net change in unrealized appreciation (depreciation) on short sales	+	8,288,782
Net change in unrealized appreciation (depreciation)	+	(2,244,170	)
Net realized and unrealized gains		10,871,342
Increase in net assets resulting from operations		$10,473,315

See financial notes 55

 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

11/1/13-4/30/14				11/1/12-10/31/13
Net investment loss		($398,027	)		($961,232	)
Net realized gains		13,115,512			17,802,813
Net change in unrealized appreciation (depreciation)	+	(2,244,170	)		8,282,576
Increase in net assets from operations		10,473,315			25,124,157
Distributions to Shareholders
Distributions from net realized gains		($15,225,593	)		$—

Transactions in Fund Shares

		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		VALUE			SHARES		VALUE
Shares sold			704,697		$12,553,907			2,580,370		$44,945,152
Shares reinvested			781,617		13,490,717			—		—
Shares redeemed	+		(1,474,959	)	(26,359,563	)		(4,113,122	)	(71,764,454	)
Net transactions in fund shares			11,355		($314,939	)		(1,532,752	)	($26,819,302	)
Shares Outstanding and Net Assets
		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			10,347,975		$192,670,612			11,880,727		$194,365,757
Total increase or decrease	+		11,355		(5,067,217	)		(1,532,752	)	(1,695,145	)
End of period			10,359,330		$187,603,395			10,347,975		$192,670,612
Net investment loss					($2,106,678	)				($1,708,651	)

56 See financial notes

Schwab Financial Services Fund™

Financial Statements

Financial Highlights

	11/1/13–			11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–
	4/30/14*			10/31/13			10/31/12			10/31/11			10/31/10			10/31/09
Per-Share Data ($)
Net asset value at beginning of period		13.76			10.66			9.17			9.74			8.77			9.05
Income (loss) from investment operations:
Net investment income (loss)		0.08			0.11			0.08			0.05			0.04			0.08
Net realized and unrealized gains (losses)		0.87			3.08			1.46			(0.58	)		0.99			(0.21	)
Total from investment operations		0.95			3.19			1.54			(0.53	)		1.03			(0.13	)
Less distributions:
Distributions from net investment income		(0.12	)		(0.09	)		(0.05	)		(0.04	)		(0.06	)		(0.15	)
Net asset value at end of period		14.59			13.76			10.66			9.17			9.74			8.77
Total return (%)		6.91	1		30.20			16.92			(5.51	)		11.79			(1.10	)
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		0.91	2		0.94			0.94			0.93	3		0.95	4		0.96	5
Gross operating expenses		0.96	2		1.03			1.10			1.06			1.04			0.99
Net investment income (loss)		1.15	2		0.91			0.78			0.45			0.37			0.91
Portfolio turnover rate		29	1		74			84			77			54			47
Net assets, end of period ($ x 1,000,000)		70			66			47			40			52			64

* 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 57

 Schwab Financial Services Fund

Portfolio Holdings as of April 30, 2014 (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	.3%	Common Stock		55,493,193		69,758,323
	0	.1%	Short-Term Investment		39,997		39,997
	99	.4%	Total Investments		55,533,190		69,798,320
	0	.6%	Other Assets and Liabilities, Net				441,395
	100	.0%	Net Assets				70,239,715

	Number		Value
Security	of Shares		($)
Common Stock 99.3% of net assets
Banks 37.7%
Bank of America Corp.		207,300		3,138,522
Chemical Financial Corp.		11,500		322,805
CIT Group, Inc.		7,500		322,875
Citigroup, Inc.		93,600		4,484,376
Fifth Third Bancorp		33,700		694,557
First Bancorp		1,400		24,094
First Defiance Financial Corp.		8,700		235,074
First Interstate Bancsystem, Inc.		11,500		286,235
Huntington Bancshares, Inc.		69,000		632,040
JPMorgan Chase & Co.		85,200		4,769,496
Regions Financial Corp.		82,500		836,550
S&T Bancorp, Inc.		5,100		118,626
SunTrust Banks, Inc.		4,400		168,344
The PNC Financial Services Group, Inc.		26,900		2,260,676
Wells Fargo & Co.		132,100		6,557,444
WSFS Financial Corp.		16,000		1,081,920
Zions Bancorp		18,300		529,236
				26,462,870
Diversified Financials 24.2%
Affiliated Managers Group, Inc. *		6,200		1,228,840
Berkshire Hathaway, Inc., Class B *		28,900		3,723,765
BlackRock, Inc.		3,100		933,100
Capital One Financial Corp.		29,100		2,150,490
Cash America International, Inc.		5,600		243,880
FBR & Co. *		5,800		149,640
GFI Group, Inc.		48,800		181,536
Investment Technology Group, Inc. *		42,200		871,008
Lazard Ltd., Class A		18,500		870,425
Moody’s Corp.		15,700		1,232,450
Morgan Stanley		47,000		1,453,710
Nelnet, Inc., Class A		6,500		274,690
SEI Investments Co.		14,200		459,796
The Bank of New York Mellon Corp.		46,900		1,588,503
The NASDAQ OMX Group, Inc.		7,400		273,060
Voya Financial, Inc.		3,000		106,170
Waddell & Reed Financial, Inc., Class A		18,600		1,254,570
				16,995,633
Insurance 18.7%
Aflac, Inc.		23,900		1,499,008
American Equity Investment Life Holding Co.		27,900		650,628
American International Group, Inc.		18,800		998,844
Assurant, Inc.		4,000		269,640
CNO Financial Group, Inc.		68,800		1,186,800
Genworth Financial, Inc., Class A *		43,000		767,550
MetLife, Inc.		29,500		1,544,325
Protective Life Corp.		20,400		1,043,460
Prudential Financial, Inc.		10,900		879,412
Reinsurance Group of America, Inc.		15,100		1,158,321
Symetra Financial Corp.		31,300		646,658
The Travelers Cos., Inc.		15,000		1,358,700
Torchmark Corp.		14,000		1,115,800
				13,119,146
Real Estate 18.7%
Ashford Hospitality Trust, Inc.		68,700		704,862
Brandywine Realty Trust		74,200		1,079,610
CBRE Group, Inc., Class A *		51,900		1,382,616
Cedar Realty Trust, Inc.		36,600		226,554
Chesapeake Lodging Trust		16,500		445,335
CyrusOne, Inc.		1,900		38,000
DCT Industrial Trust, Inc.		68,200		533,324
Duke Realty Corp.		43,400		760,368
DuPont Fabros Technology, Inc.		7,400		179,302
Hospitality Properties Trust		42,200		1,268,110
Host Hotels & Resorts, Inc.		44,800		960,960
Jones Lang LaSalle, Inc.		7,900		915,531
Liberty Property Trust		20,100		753,750
Pebblebrook Hotel Trust		21,800		750,792
PS Business Parks, Inc.		16,200		1,389,474
RLJ Lodging Trust		49,100		1,309,497
Saul Centers, Inc.		4,100		188,149
Simon Property Group, Inc.		1,700		294,440
				13,180,674
Total Common Stock
(Cost $55,493,193)				69,758,323

58 See financial notes

 Schwab Financial Services Fund

Portfolio Holdings (Unaudited) continued

	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
0.05%, 06/19/14 (a)		40,000		39,997
Total Short-Term Investment
(Cost $39,997)				39,997
End of Investments.

At 04/30/14, the tax basis cost of the fund’s investments was $55,545,342 and the unrealized appreciation and depreciation were $14,497,028 and ($244,050), respectively, with a net unrealized appreciation of $14,252,978.

*	Non-income producing security.
(a)	The rate shown is the purchase yield.

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2014 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Other Significant		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Common Stock1		$69,758,323		$—		$—		$69,758,323
Short-Term Investment1		—		39,997		—		39,997
Total		$69,758,323		$39,997		$—		$69,798,320

¹ As categorized in portfolio holdings.

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, 2014.

See financial notes 59

 Schwab Financial Services Fund

Statement of

Assets and Liabilities

As of April 30, 2014; unaudited

Assets
Investments, at value (cost $55,533,190)		$69,798,320
Receivables:
Investments sold		622,479
Dividends		58,559
Fund shares sold		52,646
Receivable from investment adviser		133
Prepaid expenses	+	1,083
Total assets		70,533,220
Liabilities
Payables:
Investments bought		250,798
Investment adviser and administrator fees		3,087
Shareholder service fees		2,878
Fund shares redeemed		14,812
Due to custodian		2,815
Accrued expenses	+	19,115
Total liabilities		293,505
Net Assets
Total assets		70,533,220
Total liabilities	−	293,505
Net assets		$70,239,715
Net Assets by Source
Capital received from investors		83,785,273
Net investment income not yet distributed		185,812
Net realized capital losses		(27,996,500	)
Net unrealized capital appreciation		14,265,130
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$70,239,715		4,815,668			$14.59

60 See financial notes

 Schwab Financial Services Fund

Statement of

Operations

For the period November 1, 2013 through April 30, 2014; unaudited

Investment Income
Dividends		$703,999
Interest	+	75
Total investment income		704,074
Expenses
Investment adviser and administrator fees		184,520
Shareholder service fees		82,376
Transfer agent fees		16,064
Professional fees		14,302
Registration fees		9,219
Shareholder reports		8,214
Portfolio accounting fees		6,507
Independent trustees’ fees		3,145
Custodian fees		2,305
Other expenses	+	1,149
Total expenses		327,801
Expense reduction by CSIM and its affiliates	−	16,064
Net expenses	−	311,737
Net investment income		392,337
Realized and Unrealized Gains (Losses)
Net realized gains on investments		3,480,678
Net realized gains on futures contracts	+	12,554
Net realized gains		3,493,232
Net change in unrealized appreciation (depreciation) on investments	+	590,331
Net realized and unrealized gains		4,083,563
Increase in net assets resulting from operations		$4,475,900

See financial notes 61

 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

11/1/13-4/30/14				11/1/12-10/31/13
Net investment income		$392,337			$519,997
Net realized gains		3,493,232			4,302,893
Net change in unrealized appreciation (depreciation)	+	590,331			9,540,044
Increase in net assets from operations		4,475,900			14,362,934
Distributions to Shareholders
Distributions from net investment income		($544,804	)		($406,901	)

Transactions in Fund Shares

		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		VALUE			SHARES		VALUE
Shares sold			756,871		$10,883,879			1,625,426		$20,364,480
Shares reinvested			33,720		471,741			33,206		353,309
Shares redeemed	+		(765,774	)	(10,976,883	)		(1,249,074	)	(15,437,977	)
Net transactions in fund shares			24,817		$378,737			409,558		$5,279,812
Shares Outstanding and Net Assets
		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			4,790,851		$65,929,882			4,381,293		$46,694,037
Total increase	+		24,817		4,309,833			409,558		19,235,845
End of period			4,815,668		$70,239,715			4,790,851		$65,929,882
Net investment income not yet distributed					$185,812					$338,279

62 See financial notes

Schwab Health Care Fund™

Financial Statements

Financial Highlights

	11/1/13–			11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–
	4/30/14*			10/31/13			10/31/12			10/31/11			10/31/10			10/31/09
Per-Share Data ($)
Net asset value at beginning of period		24.57			20.59			17.29			15.48			13.41			12.55
Income (loss) from investment operations:
Net investment income (loss)		0.13			0.22			0.27			0.15			0.19			0.13
Net realized and unrealized gains (losses)		2.22			6.26			3.18			1.85			2.01			0.82
Total from investment operations		2.35			6.48			3.45			2.00			2.20			0.95
Less distributions:
Distributions from net investment income		(0.19	)		(0.33	)		(0.15	)		(0.19	)		(0.13	)		(0.09	)
Distributions from net realized gains		(2.26	)		(2.17	)		—			—			—			—
Total distributions		(2.45	)		(2.50	)		(0.15	)		(0.19	)		(0.13	)		(0.09	)
Net asset value at end of period		24.47			24.57			20.59			17.29			15.48			13.41
Total return (%)		10.29	1		35.46			20.10			13.00			16.49			7.65
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		0.80	2		0.82			0.82			0.81	3		0.82			0.83	4
Gross operating expenses		0.81	2		0.83			0.85			0.85			0.86			0.85
Net investment income (loss)		1.13	2		1.06			1.44			0.85			1.14			0.88
Portfolio turnover rate		23	1		54			60			24			37			36
Net assets, end of period ($ x 1,000,000)		899			816			511			414			410			430

* 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 63

 Schwab Health Care Fund

Portfolio Holdings as of April 30, 2014 (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	.5%	Common Stock		668,025,922		893,881,609
	0	.3%	Short-Term Investments		3,223,503		3,223,503
	99	.8%	Total Investments		671,249,425		897,105,112
	0	.8%	Collateral Invested for Securities on Loan		6,988,144		6,988,144
	(0	.6%)	Other Assets and Liabilities, Net				(5,368,103	)
	100	.0%	Net Assets				898,725,153

	Number		Value
Security	of Shares		($)
Common Stock 99.5% of net assets
Australia 0.6%
Pharmaceuticals, Biotechnology & Life Sciences 0.6%
CSL Ltd.		83,729		5,337,750
France 1.0%
Pharmaceuticals, Biotechnology & Life Sciences 1.0%
Sanofi		81,720		8,819,209
Germany 1.9%
Pharmaceuticals, Biotechnology & Life Sciences 1.9%
Merck KGaA		98,455		16,643,204
Ireland 0.2%
Pharmaceuticals, Biotechnology & Life Sciences 0.2%
Actavis plc *		9,300		1,900,269
Israel 1.5%
Pharmaceuticals, Biotechnology & Life Sciences 1.5%
Taro Pharmaceutical Industries Ltd. *		6,088		683,865
Teva Pharmaceutical Industries Ltd.		263,050		12,894,700
				13,578,565
Japan 0.8%
Health Care Equipment & Services 0.0%
BML, Inc.		6,600		252,134
Pharmaceuticals, Biotechnology & Life Sciences 0.8%
Astellas Pharma, Inc.		60,000		668,969
Dainippon Sumitomo Pharma Co., Ltd.		33,000		500,473
Kissei Pharmaceutical Co., Ltd.		15,700		367,679
Kyowa Hakko Kirin Co., Ltd.		18,000		204,979
Mitsubishi Tanabe Pharma Corp.		306,800		4,206,926
Takeda Pharmaceutical Co., Ltd.		28,800		1,295,428
				7,244,454
				7,496,588
Malaysia 0.0%
Health Care Equipment & Services 0.0%
Kossan Rubber Industries		128,800		161,750
New Zealand 0.1%
Health Care Equipment & Services 0.1%
Fisher & Paykel Healthcare Corp., Ltd.		110,887		390,867
South Africa 0.1%
Health Care Equipment & Services 0.1%
Life Healthcare Group Holdings Ltd.		270,022		1,073,755
Sweden 0.0%
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
Meda AB, A Shares		9,254		166,340
Switzerland 10.4%
Health Care Equipment & Services 0.1%
Straumann Holding AG - Reg’d		5,080		1,127,307
Pharmaceuticals, Biotechnology & Life Sciences 10.3%
Actelion Ltd. - Reg’d *		142,846		14,063,702
Lonza Group AG - Reg’d *		144,516		15,125,122
Novartis AG - Reg’d		419,925		36,505,129
Roche Holding AG		91,587		26,866,688
				92,560,641
				93,687,948
United Kingdom 4.7%
Health Care Equipment & Services 0.1%
Smith & Nephew plc		38,352		598,028
Pharmaceuticals, Biotechnology & Life Sciences 4.6%
AstraZeneca plc		309,825		24,455,910
GlaxoSmithKline plc		135,000		3,730,122
Shire plc		237,281		13,570,560
				41,756,592
				42,354,620
United States 78.2%
Health Care Equipment & Services 25.2%
Abbott Laboratories		143,000		5,539,820

64 See financial notes

 Schwab Health Care Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Aetna, Inc.		294,700		21,056,315
Alere, Inc. *		206,400		6,893,760
Align Technology, Inc. *		145,500		7,331,745
Alliance HealthCare Services, Inc. *		17,700		503,742
AMN Healthcare Services, Inc. *		60,000		748,800
Amsurg Corp. *		117,600		5,093,256
AngioDynamics, Inc. *		58,500		786,240
Anika Therapeutics, Inc. *		56,100		2,397,714
Becton, Dickinson & Co.		50,300		5,685,409
Boston Scientific Corp. *		919,200		11,591,112
C.R. Bard, Inc.		76,600		10,519,478
Cardinal Health, Inc.		160,700		11,170,257
CareFusion Corp. *		451,900		17,651,214
Centene Corp. *		20,000		1,328,000
Cigna Corp.		32,500		2,601,300
CONMED Corp.		70,500		3,266,265
CorVel Corp. *		27,100		1,234,134
Covidien plc		33,800		2,408,250
Express Scripts Holding Co. *		156,000		10,386,480
Greatbatch, Inc. *		111,928		5,152,046
Hill-Rom Holdings, Inc.		167,000		6,239,120
Kindred Healthcare, Inc.		134,300		3,370,930
LifePoint Hospitals, Inc. *		73,200		4,093,344
Magellan Health Services, Inc. *		51,900		2,995,668
McKesson Corp.		34,100		5,769,379
MedAssets, Inc. *		196,600		4,488,378
Medtronic, Inc.		576,000		33,880,320
NuVasive, Inc. *		87,900		2,963,109
Omnicell, Inc. *		15,200		402,496
PharMerica Corp. *		35,800		973,402
St. Jude Medical, Inc.		84,300		5,350,521
Stryker Corp.		25,000		1,943,750
Symmetry Medical, Inc. *		100,000		826,000
The Providence Service Corp. *		49,200		1,998,012
Thoratec Corp. *		88,800		2,910,864
UnitedHealth Group, Inc.		126,600		9,500,064
VCA Antech, Inc. *		160,500		4,916,115
				225,966,809
Pharmaceuticals, Biotechnology & Life Sciences 53.0%
AbbVie, Inc.		753,900		39,263,112
Affymetrix, Inc. *		221,900		1,648,717
Albany Molecular Research, Inc. *		61,700		990,902
Alexion Pharmaceuticals, Inc. *		35,300		5,584,460
Allergan, Inc.		58,200		9,651,888
Amgen, Inc.		312,200		34,888,350
Bio-Rad Laboratories, Inc., Class A *		61,000		7,515,810
Biogen Idec, Inc. *		115,100		33,047,512
Bristol-Myers Squibb Co.		470,200		23,552,318
Celgene Corp. *		221,400		32,548,014
Covance, Inc. *		24,000		2,118,720
Dyax Corp. *		266,500		1,761,565
Eli Lilly & Co.		420,800		24,869,280
Emergent Biosolutions, Inc. *		57,800		1,523,608
Gilead Sciences, Inc. *		413,000		32,416,370
Impax Laboratories, Inc. *		317,400		8,300,010
Johnson & Johnson		701,800		71,085,322
Merck & Co., Inc.		890,900		52,171,104
Mylan, Inc. *		32,000		1,624,960
Myriad Genetics, Inc. *(a)		48,100		2,030,301
Nektar Therapeutics *		76,000		894,520
PAREXEL International Corp. *		40,700		1,845,745
PDL BioPharma, Inc. (a)		580,900		4,931,841
Pfizer, Inc.		2,005,800		62,741,424
Repligen Corp. *		32,900		521,465
Sagent Pharmaceuticals, Inc. *		109,200		2,259,348
Salix Pharmaceuticals Ltd. *		86,800		9,548,000
Threshold Pharmaceuticals, Inc. *		238,700		978,670
United Therapeutics Corp. *		59,900		5,990,599
				476,303,935
				702,270,744
Total Common Stock
(Cost $668,025,922)				893,881,609
Security	Face Amount		Value
Rate, Maturity Date	Local Currency		($)
Short-Term Investments 0.3% of net assets
Time Deposits 0.2%
Bank of Tokyo - Mitsubishi UFJ
US Dollar
0.03%, 05/01/14		928,308		928,308
Brown Brothers Harriman
Swiss Franc
0.00%, 05/01/14		1,579,981		1,795,229
				2,723,537
U.S. Treasury Obligation 0.1%
U.S. Treasury Bill
0.01%, 06/19/14 (b)		500,000		499,966
Total Short-Term Investments
(Cost $3,223,503)				3,223,503
End of Investments.
	Number		Value
Security	of Shares		($)
Collateral Invested for Securities on Loan 0.8% of net assets
Wells Fargo Advantage Government Money Market Fund, Institutional Class 0.01% (c)		6,988,144		6,988,144
Total Collateral Invested for Securities on Loan
(Cost $6,988,144)				6,988,144
End of Collateral Invested for Securities on Loan.

At 04/30/14, the tax basis cost of the fund’s investments was $671,445,801 and the unrealized appreciation and depreciation were $229,836,287 and ($4,176,976), respectively, with a net unrealized appreciation of $225,659,311.

See financial notes 65

 Schwab Health Care Fund

Portfolio Holdings (Unaudited) continued

At 04/30/14, the values of certain foreign securities held by the fund aggregating $189,026,731 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(a) for additional information)

*	Non-income producing security.
(a)	All or a portion of this security is on loan. Securities on loan were valued at $6,886,557.
(b)	The rate shown is the purchase yield.
(c)	The rate shown is the 7-day yield.

Reg’d — Registered

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2014 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Other Significant		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Common Stock1		$704,171,013		$—		$—		$704,171,013
Australia1		—		5,337,750		—		5,337,750
France1		—		8,819,209		—		8,819,209
Germany1		—		16,643,204		—		16,643,204
Israel
Pharmaceuticals, Biotechnology & Life Sciences		683,865		12,894,700		—		13,578,565
Japan1		—		7,496,588		—		7,496,588
Malaysia1		—		161,750		—		161,750
New Zealand1		—		390,867		—		390,867
South Africa1		—		1,073,755		—		1,073,755
Sweden1		—		166,340		—		166,340
Switzerland1		—		93,687,948		—		93,687,948
United Kingdom1		—		42,354,620		—		42,354,620
Short-Term Investments1		—		3,223,503		—		3,223,503
Total		$704,854,878		$192,250,234		$—		$897,105,112
Other Financial Instruments
Collateral Invested for Securities on Loan		$6,988,144		$—		$—		$6,988,144

¹ As categorized in portfolio holdings.

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 $130,410 from Level 1 to Level 2 for the period ended April 30, 2014. 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 during the period.

66 See financial notes

 Schwab Health Care Fund

Statement of

Assets and Liabilities

As of April 30, 2014; unaudited

Assets
Investments, at value (cost $671,249,425) including securities on loan of $6,886,557		$897,105,112
Foreign currency, at value (cost $10)		10
Collateral invested for securities on loan		6,988,144
Receivables:
Fund shares sold		1,229,806
Foreign tax reclaims		677,740
Dividends		643,531
Income from securities on loan		16,281
Interest		1
Prepaid expenses	+	8,078
Total assets		906,668,703
Liabilities
Collateral held for securities on loan		6,988,144
Payables:
Investment adviser and administrator fees		38,462
Shareholder service fees		32,631
Fund shares redeemed		837,100
Accrued expenses	+	47,213
Total liabilities		7,943,550
Net Assets
Total assets		906,668,703
Total liabilities	−	7,943,550
Net assets		$898,725,153
Net Assets by Source
Capital received from investors		624,462,899
Net investment income not yet distributed		3,843,673
Net realized capital gains		44,543,400
Net unrealized capital appreciation		225,875,181
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$898,725,153		36,722,655			$24.47

See financial notes 67

 Schwab Health Care Fund

Statement of

Operations

For the period November 1, 2013 through April 30, 2014; unaudited

Investment Income
Dividends (net of foreign withholding taxes of $337,244)		$8,350,436
Interest		2,109
Securities on loan	+	81,416
Total investment income		8,433,961
Expenses
Investment adviser and administrator fees		2,310,098
Shareholder service fees		1,040,691
Transfer agent fees		40,919
Shareholder reports		36,854
Portfolio accounting fees		31,022
Custodian fees		26,346
Registration fees		24,909
Professional fees		16,483
Independent trustees’ fees		5,054
Interest expense		253
Other expenses	+	8,241
Total expenses		3,540,870
Expense reduction by CSIM and its affiliates	−	40,919
Net expenses	−	3,499,951
Net investment income		4,934,010
Realized and Unrealized Gains (Losses)
Net realized gains on investments		44,332,783
Net realized gains on futures contracts		570,326
Net realized gains on foreign currency transactions	+	13,137
Net realized gains		44,916,246
Net change in unrealized appreciation (depreciation) on investments		34,653,058
Net change in unrealized appreciation (depreciation) on futures contracts		(170,638	)
Net change in unrealized appreciation (depreciation) on foreign currency translations	+	9,657
Net change in unrealized appreciation (depreciation)	+	34,492,077
Net realized and unrealized gains		79,408,323
Increase in net assets resulting from operations		$84,342,333

68 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

11/1/13-4/30/14				11/1/12-10/31/13
Net investment income		$4,934,010			$6,965,890
Net realized gains		44,916,246			75,480,788
Net change in unrealized appreciation (depreciation)	+	34,492,077			112,825,265
Increase in net assets from operations		84,342,333			195,271,943
Distributions to Shareholders
Distributions from net investment income		(6,270,757	)		(8,336,930	)
Distributions from net realized gains	+	(76,135,752	)		(54,300,003	)
Total distributions		($82,406,509	)		($62,636,933	)

Transactions in Fund Shares

		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		VALUE			SHARES		VALUE
Shares sold			4,817,907		$115,920,850			11,259,344		$243,726,416
Shares reinvested			3,264,515		74,267,727			3,014,800		55,894,398
Shares redeemed	+		(4,590,113	)	(109,792,003	)		(5,854,185	)	(126,778,797	)
Net transactions in fund shares			3,492,309		$80,396,574			8,419,959		$172,842,017
Shares Outstanding and Net Assets
		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			33,230,346		$816,392,755			24,810,387		$510,915,728
Total increase	+		3,492,309		82,332,398			8,419,959		305,477,027
End of period			36,722,655		$898,725,153			33,230,346		$816,392,755
Net investment income not yet distributed					$3,843,673					$5,180,420

See financial notes 69

Schwab^® International Core Equity Fund

Financial Statements

Financial Highlights

	11/1/13–			11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–
	4/30/14*			10/31/13			10/31/12			10/31/11			10/31/10			10/31/091
Per-Share Data ($)
Net asset value at beginning of period		9.82			7.90			7.32			7.80			7.25			5.85
Income (loss) from investment operations:
Net investment income (loss)		0.16			0.20			0.16			0.17			0.16			0.03
Net realized and unrealized gains (losses)		0.51			1.93			0.62			(0.46	)		0.57			1.46
Total from investment operations		0.67			2.13			0.78			(0.29	)		0.73			1.49
Less distributions:
Distributions from net investment income		(0.26	)		(0.21	)		(0.20	)		(0.19	)		(0.18	)		(0.09	)
Net asset value at end of period		10.23			9.82			7.90			7.32			7.80			7.25
Total return (%)		7.01	2		27.70			11.17			(3.89	)		10.09			25.98
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		0.86	3		0.86			0.86			0.80	4		0.87	5		0.86
Gross operating expenses		0.98	3		1.10			1.16			1.22			1.27			1.60
Net investment income (loss)		3.39	3		2.40			2.45			2.32			1.85			1.19
Portfolio turnover rate		40	2		75			112			86			91	6		94
Net assets, end of period ($ x 1,000,000)		215			147			78			60			53			37

* 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 Not annualized.

³ Annualized.

⁴ The ratio of net operating expenses would have been 0.86%, if a voluntary reduction of Investment Adviser fees had not been included.

⁵ The ratio of net operating expenses would have been 0.86%, if certain non-routine expenses had not been incurred.

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

70 See financial notes

 Schwab International Core Equity Fund

Portfolio Holdings as of April 30, 2014 (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		185,890,791		210,102,032
	2	.4%	Other Investment Company		5,104,030		5,104,030
	0	.1%	Short-Term Investments		364,988		364,988
	100	.4%	Total Investments		191,359,809		215,571,050
	(0	.4%)	Other Assets and Liabilities, Net				(897,721	)
	100	.0%	Net Assets				214,673,329

	Number		Value
Security	of Shares		($)
Common Stock 97.9% of net assets
Australia 6.3%
Banks 1.1%
Australia & New Zealand Banking Group Ltd.		9,790		314,825
Westpac Banking Corp.		63,016		2,064,058
				2,378,883
Commercial & Professional Supplies 0.6%
Transpacific Industries Group Ltd. *		1,268,358		1,318,979
Diversified Financials 0.9%
Challenger Ltd.		282,086		1,855,924
Energy 0.8%
Beach Energy Ltd.		365,200		584,452
Woodside Petroleum Ltd.		26,761		1,017,216
				1,601,668
Food & Staples Retailing 0.2%
Wesfarmers Ltd.		10,792		429,512
Materials 1.9%
Arrium Ltd.		468,618		522,254
BHP Billiton Ltd.		22,271		784,309
CSR Ltd.		335,801		1,143,607
Fortescue Metals Group Ltd.		94,230		445,702
Mount Gibson Iron Ltd.		792,116		540,957
OZ Minerals Ltd.		85,445		294,063
Rio Tinto Ltd.		7,537		434,653
				4,165,545
Software & Services 0.2%
Computershare Ltd.		40,955		472,076
Telecommunication Services 0.6%
Telstra Corp., Ltd.		267,141		1,298,868
				13,521,455
Belgium 1.5%
Energy 0.3%
Exmar N.V.		34,069		568,633
Food & Staples Retailing 1.0%
Delhaize Group S.A.		30,175		2,246,929
Materials 0.2%
Bekaert N.V.		11,191		455,451
				3,271,013
Brazil 0.7%
Consumer Durables & Apparel 0.0%
MRV Engenharia e Participacoes S.A.		11,900		37,679
Food, Beverage & Tobacco 0.7%
Sao Martinho S.A.		95,384		1,428,781
				1,466,460
Canada 0.9%
Commercial & Professional Supplies 0.1%
Transcontinental, Inc., Class A		21,410		311,955
Materials 0.3%
Teck Resources Ltd., Class B		30,200		688,286
Media 0.1%
Cogeco Cable, Inc.		2,200		120,432
Retailing 0.4%
Canadian Tire Corp., Ltd., Class A		7,600		746,444
				1,867,117
China 0.5%
Materials 0.5%
China Resources Cement Holdings Ltd.		1,502,000		1,045,645
Denmark 1.0%
Pharmaceuticals, Biotechnology & Life Sciences 0.3%
H. Lundbeck A/S		25,250		735,910
Transportation 0.7%
AP Moeller - Maersk A/S, Series B		625		1,492,036
				2,227,946
Finland 1.2%
Materials 1.2%
UPM-Kymmene Oyj		147,849		2,589,397
France 11.3%
Automobiles & Components 1.1%
Compagnie Generale des Etablissements Michelin		18,442		2,261,557
Banks 1.2%
BNP Paribas S.A.		22,585		1,697,138
Credit Agricole S.A. *		56,223		887,111
				2,584,249

See financial notes 71

 Schwab International Core Equity Fund

Portfolio Holdings (Unaudited) continued

		Number		Value
Security		of Shares		($)
Capital Goods 1.0%
Bouygues S.A.			14,742		663,993
Vinci S.A.			20,355		1,536,931
					2,200,924
Energy 2.8%
Total S.A.			82,038		5,869,340
Food & Staples Retailing 0.6%
Carrefour S.A.			34,496		1,344,690
Health Care Equipment & Services 0.6%
BioMerieux			10,992		1,200,307
Pharmaceuticals, Biotechnology & Life Sciences 2.6%
Sanofi			51,418		5,549,022
Telecommunication Services 0.7%
Orange S.A.			95,807		1,552,195
Utilities 0.7%
GDF Suez			62,484		1,574,811
					24,137,095
Germany 7.7%
Automobiles & Components 1.1%
Bayerische Motoren Werke AG			3,930		494,020
Continental AG			5,600		1,317,706
Daimler AG - Reg’d			5,157		480,112
					2,291,838
Capital Goods 1.2%
Siemens AG - Reg’d			20,027		2,641,967
Diversified Financials 0.3%
Deutsche Bank AG - Reg’d			13,636		600,604
Food & Staples Retailing 0.4%
Metro AG *			23,314		934,046
Food, Beverage & Tobacco 0.3%
Suedzucker AG			26,416		564,484
Insurance 2.1%
Allianz SE - Reg’d			23,278		4,051,067
Hannover Rueck SE			4,735		441,216
					4,492,283
Materials 0.8%
BASF SE			15,507		1,798,901
Pharmaceuticals, Biotechnology & Life Sciences 0.9%
Merck KGaA			11,252		1,902,081
Semiconductors & Semiconductor Equipment 0.3%
Infineon Technologies AG			58,282		677,661
Telecommunication Services 0.3%
Deutsche Telekom AG - Reg’d			40,433		679,317
					16,583,182
Greece 0.2%
Consumer Services 0.2%
OPAP S.A.			19,136		305,603
Hong Kong 2.1%
Banks 0.2%
BOC Hong Kong (Holdings) Ltd.			150,000		440,126
Capital Goods 1.2%
Hutchison Whampoa Ltd.			167,000		2,291,155
Johnson Electric Holdings Ltd.			231,500		221,429
					2,512,584
Real Estate 0.5%
Cheung Kong (Holdings) Ltd.			60,000		1,024,642
Telecommunication Services 0.2%
China Unicom (Hong Kong) Ltd.			356,000		545,760
					4,523,112
Ireland 0.4%
Food, Beverage & Tobacco 0.4%
Kerry Group plc, Class A			10,887		859,422
Israel 0.9%
Food, Beverage & Tobacco 0.1%
Strauss Group Ltd.			7,568		136,995
Pharmaceuticals, Biotechnology & Life Sciences 0.8%
Teva Pharmaceutical Industries Ltd.			37,443		1,835,454
					1,972,449
Italy 2.9%
Banks 1.8%
Intesa Sanpaolo S.p.A.			1,125,230		3,850,569
Capital Goods 0.1%
Salini Impregilo S.p.A.			34,018		217,313
Consumer Services 0.2%
Gtech S.p.A.			16,559		486,042
Energy 0.4%
Eni S.p.A.			29,410		761,699
Telecommunication Services 0.4%
Telecom Italia S.p.A. *			653,369		839,598
					6,155,221
Japan 18.3%
Automobiles & Components 2.0%
Denso Corp.			2,800		127,548
Toyota Motor Corp.			75,700		4,089,931
					4,217,479
Banks 4.1%
Mizuho Financial Group, Inc.			1,910,200		3,741,331
Resona Holdings, Inc.			753,200		3,851,113
The Bank of Yokohama Ltd.			252,000		1,266,576
					8,859,020
Capital Goods 1.1%
Kinden Corp.			40,000		368,252
Mitsubishi Electric Corp.			167,000		1,901,601
	��				2,269,853
Commercial & Professional Supplies 0.4%
Dai Nippon Printing Co., Ltd.			14,000		126,103
Duskin Co., Ltd.			37,800		698,744
					824,847

72 See financial notes

 Schwab International Core Equity Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Consumer Durables & Apparel 1.2%
Gunze Ltd.		287,000		783,701
Panasonic Corp.		170,600		1,859,550
				2,643,251
Consumer Services 0.3%
Oriental Land Co., Ltd.		3,800		569,291
Diversified Financials 1.6%
Daiwa Securities Group, Inc.		327,000		2,451,989
ORIX Corp.		66,900		969,370
				3,421,359
Food, Beverage & Tobacco 0.4%
Kirin Holdings Co., Ltd.		43,000		595,551
Mitsui Sugar Co., Ltd.		36,000		149,370
				744,921
Insurance 0.9%
T&D Holdings, Inc.		162,300		1,937,260
Media 0.1%
Daiichikosho Co., Ltd.		7,300		210,355
Real Estate 0.3%
Daito Trust Construction Co., Ltd.		3,900		396,867
Nomura Real Estate Holdings, Inc.		13,800		257,843
				654,710
Retailing 1.1%
Aoyama Trading Co., Ltd.		32,884		816,014
Canon Marketing Japan, Inc.		31,600		508,937
Izumi Co., Ltd.		24,800		725,716
USS Co., Ltd.		16,000		233,218
				2,283,885
Semiconductors & Semiconductor Equipment 0.1%
Ulvac, Inc. *		11,500		217,950
Software & Services 0.5%
Capcom Co., Ltd.		67,400		1,173,920
Technology Hardware & Equipment 2.1%
Canon, Inc.		35,000		1,096,723
FUJIFILM Holdings Corp.		107,700		2,782,115
Konica Minolta, Inc.		27,500		256,248
Murata Manufacturing Co., Ltd.		3,800		316,783
The Nippon Signal Co., Ltd.		16,100		133,503
				4,585,372
Telecommunication Services 1.7%
Nippon Telegraph & Telephone Corp.		66,100		3,668,071
Transportation 0.4%
Central Japan Railway Co.		2,845		349,439
West Japan Railway Co.		13,500		547,464
				896,903
				39,178,447
Mexico 0.1%
Food, Beverage & Tobacco 0.1%
Industrias Bachoco S.A.B. de CV, Series B		63,825		234,122
Netherlands 1.8%
Commercial & Professional Supplies 0.3%
Randstad Holding N.V.		11,475		670,595
Consumer Durables & Apparel 0.2%
TomTom N.V. *		60,869		431,599
Food & Staples Retailing 0.1%
Koninklijke Ahold N.V.		4,676		90,396
Food, Beverage & Tobacco 1.1%
Unilever N.V. CVA		55,640		2,385,904
Semiconductors & Semiconductor Equipment 0.1%
STMicroelectronics N.V.		20,133		191,992
				3,770,486
New Zealand 0.3%
Health Care Equipment & Services 0.3%
Fisher & Paykel Healthcare Corp., Ltd.		183,101		645,415
Norway 1.2%
Energy 1.2%
Statoil A.S.A.		84,156		2,565,529
Portugal 0.5%
Food & Staples Retailing 0.5%
Sonae		595,491		1,120,270
Republic of Korea 0.3%
Semiconductors & Semiconductor Equipment 0.1%
Samsung Electronics Co., Ltd.		110		143,435
Technology Hardware & Equipment 0.2%
LG Display Co., Ltd. *		21,390		569,695
				713,130
Singapore 2.8%
Banks 1.9%
DBS Group Holdings Ltd.		300,000		4,064,148
Food, Beverage & Tobacco 0.3%
Wilmar International Ltd.		242,000		657,711
Retailing 0.1%
Jardine Cycle & Carriage Ltd.		6,000		224,976
Technology Hardware & Equipment 0.2%
Venture Corp., Ltd.		89,000		545,139
Transportation 0.3%
SATS Ltd.		109,000		275,937
Singapore Airlines Ltd.		35,000		290,165
				566,102
				6,058,076
Spain 2.0%
Banks 0.2%
Banco Santander S.A.		51,969		516,866

See financial notes 73

 Schwab International Core Equity Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Energy 1.0%
Repsol S.A.		83,080		2,236,884
Utilities 0.8%
Endesa S.A.		42,328		1,605,083
				4,358,833
Sweden 3.9%
Banks 1.7%
Skandinaviska Enskilda Banken AB, A Shares		159,761		2,206,766
Swedbank AB, A Shares		57,719		1,544,671
				3,751,437
Capital Goods 0.6%
Trelleborg AB, B Shares		55,821		1,194,375
Food & Staples Retailing 0.3%
Axfood AB		13,433		714,187
Real Estate 0.5%
Fabege AB		27,792		390,419
Hufvudstaden AB, A Shares		48,402		709,604
				1,100,023
Retailing 0.2%
Hennes & Mauritz AB, B Shares		10,339		423,205
Technology Hardware & Equipment 0.6%
Telefonaktiebolaget LM Ericsson, B Shares		101,160		1,219,834
				8,403,061
Switzerland 9.4%
Capital Goods 2.1%
Bucher Industries AG - Reg’d		2,481		808,125
Georg Fischer AG - Reg’d *		1,602		1,270,875
OC Oerlikon Corp. AG - Reg’d *		147,972		2,357,149
				4,436,149
Consumer Durables & Apparel 0.3%
Forbo Holding AG - Reg’d *		626		647,623
Diversified Financials 0.6%
UBS AG - Reg’d *		57,845		1,209,763
Food, Beverage & Tobacco 1.4%
Nestle S.A. - Reg’d		40,217		3,108,141
Insurance 1.7%
Baloise Holding AG - Reg’d		6,253		761,450
Helvetia Holding AG - Reg’d		2,550		1,271,043
Zurich Insurance Group AG *		5,800		1,663,200
				3,695,693
Materials 0.2%
Givaudan S.A. - Reg’d *		225		355,089
Pharmaceuticals, Biotechnology & Life Sciences 3.1%
Actelion Ltd. - Reg’d *		12,936		1,273,596
Lonza Group AG - Reg’d *		6,508		681,131
Novartis AG - Reg’d		39,866		3,465,651
Roche Holding AG		4,673		1,370,806
				6,791,184
				20,243,642
United Kingdom 19.7%
Banks 1.5%
HSBC Holdings plc		120,284		1,229,015
Lloyds Banking Group plc *		1,571,138		2,003,535
				3,232,550
Commercial & Professional Supplies 0.8%
Berendsen plc		98,275		1,717,448
Diversified Financials 0.6%
Man Group plc		728,404		1,215,596
Energy 2.9%
BP plc		430,593		3,635,545
Royal Dutch Shell plc, B Shares		31,962		1,357,138
Soco International plc *		180,984		1,322,750
				6,315,433
Food & Staples Retailing 0.4%
Tesco plc		167,119		827,895
Food, Beverage & Tobacco 1.1%
Associated British Foods plc		25,989		1,304,919
Unilever plc		21,801		975,226
				2,280,145
Materials 1.8%
BHP Billiton plc		36,330		1,179,431
Rio Tinto plc		50,724		2,757,746
				3,937,177
Pharmaceuticals, Biotechnology & Life Sciences 3.4%
AstraZeneca plc		64,595		5,098,780
Shire plc		37,145		2,124,394
				7,223,174
Real Estate 0.7%
Grainger plc		393,907		1,421,440
Retailing 2.3%
Next plc		28,684		3,164,472
WH Smith plc		91,586		1,698,517
				4,862,989
Semiconductors & Semiconductor Equipment 0.2%
CSR plc		48,478		471,033
Software & Services 0.6%
The Sage Group plc		186,156		1,342,833
Technology Hardware & Equipment 0.1%
Pace plc		38,509		237,292
Telecommunication Services 2.1%
BT Group plc		557,646		3,481,185
Vodafone Group plc		276,642		1,050,301
				4,531,486
Transportation 0.6%
easyJet plc		45,317		1,253,905
Utilities 0.6%
Centrica plc		253,810		1,415,508
				42,285,904
Total Common Stock
(Cost $185,890,791)				210,102,032

74 See financial notes

 Schwab International Core Equity Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Other Investment Company 2.4% of net assets
United States 2.4%
State Street Institutional U.S. Government Money Market Fund, Institutional Class 0.00% (c)		5,104,030		5,104,030
Total Other Investment Company
(Cost $5,104,030)				5,104,030
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 0.1% of net assets
U.S. Treasury Obligations 0.1%
U.S. Treasury Bills
0.01%, 06/19/14 (a)(b)		100,000		99,999
0.02%, 06/19/14 (a)(b)		115,000		114,998
0.04%, 06/19/14 (a)(b)		100,000		99,994
0.05%, 06/19/14 (a)(b)		50,000		49,997
Total Short-Term Investments
(Cost $364,988)				364,988
End of Investments.

At 04/30/14, the tax basis cost of the fund’s investments was $191,568,217 and the unrealized appreciation and depreciation were $26,894,047 and ($2,891,214), respectively, with a net unrealized appreciation of $24,002,834.

At 04/30/14, the values of certain foreign securities held by the fund aggregating $203,112,794 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(a) for additional information).

*	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)	The rate shown is the 7-day yield.

CVA —	Dutch Certificate
Reg’d —	Registered

In addition to the above, the fund held the following at 04/30/14:

			Contract		Unrealized
	Number of		Value		Appreciation
	Contracts		($)		($)
Futures Contracts
MSCI EAFE, e-mini, Long, expires 06/20/14		18		1,731,870		52,091

See financial notes 75

 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, 2014 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Other Significant		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Common Stock1		$—		$152,891,113		$—		$152,891,113
Brazil1		1,466,460		—		—		1,466,460
Canada1		1,867,117		—		—		1,867,117
France1		—		22,936,788		—		22,936,788
Health Care Equipment & Services		1,200,307		—		—		1,200,307
Ireland1		859,422		—		—		859,422
Mexico1		234,122		—		—		234,122
Sweden1		—		7,688,874		—		7,688,874
Food & Staples Retailing		714,187		—		—		714,187
Switzerland1		—		19,596,019		—		19,596,019
Consumer Durables & Apparel		647,623		—		—		647,623
Other Investment Company1		5,104,030		—		—		5,104,030
Short-Term Investments1		—		364,988		—		364,988
Total		$12,093,268		$203,477,782		$—		$215,571,050
Other Financial Instruments
Futures Contracts2		$52,091		$—		$—		$52,091

1	As categorized in portfolio holdings.
2	Futures contracts are not included in Investments in the schedule of portfolio holdings 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 $760,641 and $512,489 from Level 1 to Level 2 and from Level 2 to Level 1, respectively, for the period ended April 30, 2014. 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 during the period.

76 See financial notes

 Schwab International Core Equity Fund

Statement of

Assets and Liabilities

As of April 30, 2014; unaudited

Assets
Investments, at value (cost $191,359,809)		$215,571,050
Foreign currency, at value (cost $109,730)		110,074
Receivables:
Investments sold		3,517,494
Fund shares sold		1,343,320
Dividends		818,669
Foreign tax reclaims		154,646
Variation margin on futures contracts	+	6,120
Total assets		221,521,373
Liabilities
Payables:
Investments bought		6,705,995
Investment adviser and administrator fees		9,014
Shareholder service fees		7,807
Fund shares redeemed		91,561
Accrued expenses	+	33,667
Total liabilities		6,848,044
Net Assets
Total assets		221,521,373
Total liabilities	−	6,848,044
Net assets		$214,673,329
Net Assets by Source
Capital received from investors		193,124,693
Net investment income not yet distributed		1,183,056
Net realized capital losses		(3,907,200	)
Net unrealized capital appreciation		24,272,780
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$214,673,329		20,983,803			$10.23

See financial notes 77

 Schwab International Core Equity Fund

Statement of

Operations

For the period November 1, 2013 through April 30, 2014; unaudited

Investment Income
Dividends (net of foreign withholding taxes of $328,139)		$3,625,025
Interest	+	12
Total investment income		3,625,037
Expenses
Investment adviser and administrator fees		494,197
Shareholder service fees		211,133
Custodian fees		33,349
Professional fees		24,977
Portfolio accounting fees		22,208
Registration fees		13,751
Transfer agent fees		13,231
Shareholder reports		11,484
Independent trustees’ fees		3,347
Interest expense		20
Other expenses	+	5,289
Total expenses		832,986
Expense reduction by CSIM and its affiliates	−	100,190
Net expenses	−	732,796
Net investment income		2,892,241
Realized and Unrealized Gains (Losses)
Net realized gains on investments		8,503,158
Net realized losses on futures contracts		(19,140	)
Net realized losses on foreign currency transactions	+	(29,480	)
Net realized gains		8,454,538
Net change in unrealized appreciation (depreciation) on investments		806,368
Net change in unrealized appreciation (depreciation) on futures contracts		21,955
Net change in unrealized appreciation (depreciation) on foreign currency translations	+	3,225
Net change in unrealized appreciation (depreciation)	+	831,548
Net realized and unrealized gains		9,286,086
Increase in net assets resulting from operations		$12,178,327

78 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

11/1/13-4/30/14				11/1/12-10/31/13
Net investment income		$2,892,241			$2,561,773
Net realized gains		8,454,538			6,540,993
Net change in unrealized appreciation (depreciation)	+	831,548			17,187,224
Increase in net assets from operations		12,178,327			26,289,990
Distributions to Shareholders
Distributions from net investment income		($4,000,904	)		($2,100,275	)

Transactions in Fund Shares

		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		VALUE			SHARES		VALUE
Shares sold			7,482,838		$73,908,829			8,070,603		$70,752,618
Shares reinvested			277,927		2,612,515			154,692		1,217,426
Shares redeemed	+		(1,765,416	)	(17,257,949	)		(3,128,819	)	(27,045,232	)
Net transactions in fund shares			5,995,349		$59,263,395			5,096,476		$44,924,812
Shares Outstanding and Net Assets
		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			14,988,454		$147,232,511			9,891,978		$78,117,984
Total increase	+		5,995,349		67,440,818			5,096,476		69,114,527
End of period			20,983,803		$214,673,329			14,988,454		$147,232,511
Net investment income not yet distributed					$1,183,056					$2,291,719

See financial notes 79

 Schwab Active Equity Funds

Financial Notes, unaudited

1. Business Structure of the Funds:

Each of the funds 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 a 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 U.S. Securities and 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:

•  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

80 

 Schwab Active Equity 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 NAV 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 contracts (“futures”) and forward foreign currency exchange contracts (“forwards”): Futures are valued at their settlement prices as of the close of their exchanges. Forwards are valued based on that day’s forward exchange rates or by using an interpolated forward exchange rate for contracts with interim settlement dates.

•  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 NAVs. Exchange traded 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, ETFs and futures contracts. Investments in mutual funds are valued daily at their NAVs, and investments in ETFs are valued daily at the last reported sale price or the official closing price, 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

81

 Schwab Active Equity Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

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, 2014 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 a 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 appreciation or depreciation 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 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 appreciation or depreciation 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 be maintained on a daily marked-to-market basis in an amount at least equal to the current value of the securities loaned. The lending agent provides a fund with indemnification against borrower default (the borrower fails to return the security on loan) reducing the risk of loss as a result of default. The cash collateral of securities loaned is currently invested in money market portfolios operating under Rule 2a-7 of the 1940 Act. Each fund bears the risk of loss with respect to the investment of cash collateral. Securities lending income, as disclosed in each 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 and broker rebates which are subject to adjustments pursuant to the securities lending agreement. On loans not collateralized by cash, a fee is received from the borrower, and is allocated between a fund and the lending agent. A fund retains the right to recall a security on loan. The aggregate market value of securities loaned will not at any time exceed one-third of the total assets of a fund, including collateral received from the loan (at market value computed at the time of the loan). Total costs and expenses, including agent fees associated with securities lending activities under the trust’s Securities Lending Program paid to the unaffiliated lending agent are approximately 15% of the gross lending revenues.

The values of the securities on loan and the related cash collateral as of April 30, 2014 for the Schwab Small-Cap Equity Fund and Schwab Health Care Fund are disclosed in each fund’s Portfolio Holdings and Statement of Assets and Liabilities.

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

82 

 Schwab Active Equity Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

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 and losses from security transactions are based on the identified costs of the securities involved.

Assets and liabilities denominated in foreign currencies are reported in U.S. dollars. For assets and liabilities held on a given date, the dollar value is based on market exchange rates in effect on that date. Transactions involving foreign currencies, including purchases, sales, income receipts and expense payments, are 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.

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 forward 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. Any distributions from underlying funds are recorded in accordance with the character of the distributions as designated by the underlying funds.

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.

83

 Schwab Active Equity Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

(g) Custody Credit:

Certain 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 a fund’s 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, 2014, 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.

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.

Market Risk. 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.

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.

Management Risk. 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.

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 - a fund’s performance also will lag those investments.

84 

 Schwab Active Equity Funds

Financial Notes, unaudited (continued)

3. Risk Factors (continued):

Large-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 - bonds and small-cap stocks, for instance - a fund’s performance also will lag those investments.

Growth Investing Risk. 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.

Derivatives Risk. 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 a fund to realize higher amounts of short-term capital gain. These risks could cause a fund to lose more than the principal amount invested.

Liquidity Risk. 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 Risk. 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.

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.

REITs Risk. 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.

Short Sales Risk. 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.

Dividend Paying Risk. 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.

85

 Schwab Active Equity Funds

Financial Notes, unaudited (continued)

3. Risk Factors (continued):

Foreign Investment Risk. 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); the imposition of economic sanctions or other government restrictions; differing accounting, auditing, financial reporting and legal standards and practices; differing securities market structures; and higher transaction costs. These risks may negatively impact the value or liquidity of a fund’s investments, and could impair the fund’s ability to meet its investment objective or invest in accordance with its investment strategies.

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. 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.

Geographic Risk. 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.

Concentration Risk. 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.

Security Lending Risk. 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

86 

 Schwab Active Equity Funds

Financial Notes, unaudited (continued)

4. Affiliates and Affiliated Transactions (continued):

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 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 shares of each fund in this report that are owned by other Schwab funds as of April 30, 2014, as applicable:

	Underlying Funds
	Schwab		Schwab			Schwab
	Core		Dividend			Small-Cap
	Equity Fund		Equity Fund			Equity Fund
Schwab Target 2010 Fund		0.2%		0.1%			0.2%
Schwab Target 2015 Fund		0.3%		0.2%			0.4%
Schwab Target 2020 Fund		1.9%		1.1%			2.9%
Schwab Target 2025 Fund		1.4%		0.8%			2.4%
Schwab Target 2030 Fund		3.5%		2.1%			6.6%
Schwab Target 2035 Fund		1.3%		0.8%			2.7%
Schwab Target 2040 Fund		4.1%		2.4%			8.8%
Schwab Target 2045 Fund		0.2%		0.1%			0.4%
Schwab Target 2050 Fund		0.1%		0.1%			0.3%
Schwab Target 2055 Fund		0.1%		0.0%	*		0.2%
Schwab Monthly Income Fund - Moderate Payout		—%		0.7%			—%
Schwab Monthly Income Fund - Enhanced Payout		—%		1.0%			—%
Schwab Monthly Income Fund - Maximum Payout		—%		0.3%			—%
Schwab Balanced Fund		3.0%		—%			—%

* Less than 0.1%

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.

87

 Schwab Active Equity Funds

Financial Notes, unaudited (continued)

5. Board of Trustees:

The Board may include people who are officers and/or directors of CSIM 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.

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 on the funds’ 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, 2014, purchases and sales/maturities of securities (excluding short-term obligations) were as follows:

	Purchases of Securities		Sales/Maturities of Securities
Schwab Core Equity Fund		$803,906,236		$902,513,760
Schwab Dividend Equity Fund		678,161,726		661,753,277
Schwab Large-Cap Growth Fund		104,035,994		120,176,272
Schwab Small-Cap Equity Fund		311,574,400		317,691,076
Schwab Hedged Equity Fund*		135,468,201		148,870,173
Schwab Financial Services Fund		20,396,310		20,055,923
Schwab Health Care Fund		214,140,196		202,387,178
Schwab International Core Equity Fund		125,201,695		69,260,709

* Including securities sold short.

8. Derivatives:

Certain funds entered into equity index futures contracts during the report period. The funds invested in futures to equitize available cash. The fair value and variation margin for futures contracts held at April 30, 2014 are presented on the Portfolio Holdings and Statement of Assets and Liabilities, 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		$8,651,284		95
Schwab Dividend Equity Fund		11,080,621		121
Schwab Large-Cap Growth Fund		—		—
Schwab Small-Cap Equity Fund		7,947,963		71
Schwab Hedged Equity Fund		234,738		3
Schwab Financial Services Fund		182,793		2
Schwab Health Care Fund		9,326,953		102
Schwab International Core Equity Fund		1,993,348		21

88 

 Schwab Active Equity Funds

Financial Notes, unaudited (continued)

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
	(11/1/13-4/30/14)		(11/1/12-10/31/13)
Schwab Core Equity Fund		$6,227		$19,267
Schwab Dividend Equity Fund		20,516		50,175
Schwab Large-Cap Growth Fund		1,446		6,787
Schwab Small-Cap Equity Fund		17,052		15,023
Schwab Hedged Equity Fund		1,056		10,792
Schwab Financial Services Fund		1,553		4,292
Schwab Health Care Fund		16,372		38,090
Schwab International Core Equity Fund		10,298		8,761

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, 2013, 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		$32,645,024			$—		$—			$—		$—
October 31, 2017		1,636,580			—		14,051,004			—		—
Total		$34,281,604	*		$—		$14,051,004			$—		$—
						Schwab
	Schwab			Schwab		International
	Financial			Health Care		Core
Expiration Date	Services Fund			Fund		Equity Fund
October 31, 2016		$2,634,441			$—		$—
October 31, 2017		28,673,848			—		12,169,184
October 31, 2018		170,394			—		—
Total		$31,478,683			$—		$12,169,184	*

* 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.

Qualified late-year losses are certain capital and ordinary losses which occur during the portion of a fund’s taxable year subsequent to October 31. A fund may elect to treat any portion of qualified late-year losses as arising during the first day of the next taxable year. For the year ended October 31, 2013, the funds had late-year ordinary 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
Late-year ordinary losses deferred		$—		$—		$—		$—		$1,649,544
Capital losses utilized		75,465,662		66,553,849		31,765,537		14,134,762		2,570,724
					Schwab
	Schwab		Schwab		International
	Financial		Health Care		Core
	Services Fund		Fund		Equity Fund
Capital losses utilized		$4,316,363		$—		$6,149,622

89

 Schwab Active Equity Funds

Financial Notes, unaudited (continued)

10. Federal Income Taxes (continued):

As of October 31, 2013, 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, 2013, 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.

90 

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 97 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).	76	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).	76	Director, Gilead Sciences, Inc. (2005 – present) Director, Monaco Coach Corporation (2005 – 2009)
David L. Mahoney 1954 Trustee (Trustee of Schwab Capital Trust since 2011.)	Private Investor.	76	Director, Symantec Corporation (2003 – present) Director, Corcept Therapeutics Incorporated (2004 – present)
Kiran M. Patel 1948 Trustee (Trustee of Schwab Capital Trust since 2011.)	Retired. Executive Vice President and General Manager of Small Business Group, Intuit, Inc. (financial software and services for consumers and small businesses) (Dec. 2008 – Sept. 2013).	76	Director, KLA-Tencor Corporation (2008 – present)
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).	76	Director, Eaton (2012 – present) Director and Chairman of the Audit Committee, Oneok Partners LP (2003 – 2013) Director, Oneok, Inc. (2009 – 2013) Lead Independent Director, Board of Cooper Industries (2002 – 2012)
Joseph H. Wender 1944 Trustee (Trustee of Schwab Capital Trust since 2008.)	Senior Consultant, Goldman Sachs & Co., Inc. (investment banking and securities firm) (Jan. 2008 – present); Partner, Colgin Partners, LLC (vineyards) (February 1998 – present).	76	Board Member and Chairman of the Audit Committee, Isis Pharmaceuticals (1994 – present)

91

 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.	76	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.	97	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, Chief Executive Officer (Dec. 2010 – present), and Chief Investment Officer (Sept. 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 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 (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).

92 

 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
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).
David Lekich 1964 Chief Legal Officer and Secretary (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 and Assistant Secretary (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 retire at age 72 or after twenty years as a trustee, whichever comes first. In addition, the retirement policy requires any independent trustee of 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 own stock of The Charles Schwab Corporation, the parent company of 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.

93

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. Treasury Bills 1 − 3 Months Index An index that includes all publicly issued zero-coupon U.S. Treasury Bills that have a remaining maturity of less than 3 months and more than 1 month, are rated investment grade, and have $250 million or more of outstanding face 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 capital gain or loss is considered unrealized appreciation or depreciation.

Dow Jones Global Health Care Index An index that measures the performance of healthcare providers, researchers, and supplies producers around the world.

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.

market cap, market capitalization The value of a company as determined by the total value of all shares of its stock outstanding.

MSCI EAFE (Europe, Australasia, Far East) 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 1000 Growth Index An index that is composed of larger-cap companies and measures the performance of those Russell 1000 companies with higher price-to-book ratios and higher forecasted growth values

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. It includes approximately 2000 of the smallest securities based on a combination of their market cap and current index membership.

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.

S&P 1500 SuperComposite Financial Sector Index A capitalization-weighted index designed to measure the performance of the financial sector of the S&P 1500 SuperComposite Index. The S&P SuperComposite 1500 is comprised of the 1500 companies included in the S&P 500, S&P MidCap 400 and S&P SmallCap 600 indices.

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.

94 

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

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MFR27230-11

00118058

Semiannual report dated April 30, 2014, 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, 2014

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	30
Schwab Fundamental International Small Company Index Fund	38
Schwab Fundamental Emerging Markets Large Company Index Fund	47
Financial Notes	55
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 Schwab. 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 6 Months Ended April 30, 2014
Schwab Fundamental US Large Company Index Fund (Ticker Symbol: SFLNX)	8.90%
Russell Fundamental U.S. Large Company Index	9.17%
Fund Category: Morningstar Large Value	8.14%
Performance Details	page 6
Schwab Fundamental US Small Company Index Fund (Ticker Symbol: SFSNX)	6.97%
Russell Fundamental U.S. Small Company Index	7.37%
Fund Category: Morningstar Small Blend	4.48%
Performance Details	page 7
Schwab Fundamental International Large Company Index Fund1 (Ticker Symbol: SFNNX)	6.97%
Russell Fundamental Developed ex-U.S. Large Company Index (Net)	6.87%
Fund Category: Morningstar Foreign Large Value	4.64%
Performance Details	pages 8-9
Schwab Fundamental International Small Company Index Fund1 (Ticker Symbol: SFILX)	4.59%
Russell Fundamental Developed ex-U.S. Small Company Index (Net)	4.69%
Fund Category: Morningstar Foreign Small/Mid Blend	5.91%
Performance Details	pages 10-11
Schwab Fundamental Emerging Markets Large Company Index Fund1 (Ticker Symbol: SFENX)	-4.58%
Russell Fundamental Emerging Markets Large Company Index (Net)	-4.79%
Fund Category: Morningstar Diversified Emerging Markets	-1.72%
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.

For index definitions, please see the Glossary.

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 Index Series is a joint trademark of Russell Investments (“Russell”) and Research Affiliates LLC (“RA”) and is used by the funds 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 Index Series. 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 regarding the Schwab Fundamental Index Funds. In recent years, fundamentally weighted index strategies have enjoyed significant asset growth as investors have embraced the value of alternative strategies to traditional index funds.

Unlike traditional equity indices that are often weighted by market capitalization, fundamentally weighted indices select and weight stocks by objective non-price measures, such as dividends, cash flow, and sales. By using this weighting methodology, these funds can serve as an effective complement to capitalization-weighted and actively managed investment vehicles, potentially helping shareholders create more attractive risk-adjusted portfolios.

For the six-month reporting period ended April 30, 2014, the funds’ investment returns generally tracked their respective indices. Some improvement in the economy helped U.S. stocks rally and led the Federal Reserve to begin “tapering” its stimulative policies, even as harsh winter weather temporarily slowed economic growth. In developed international markets, stocks were supported by the European Central Bank’s progress toward unifying the euro zone’s banking system and by the continuation of low interest rates. Meanwhile, emerging markets faced concerns about slow growth, relatively high inflation, and higher U.S. interest rates in light of the Fed’s tapering. Emerging markets also faced political unrest between Russia and the Ukraine that drove

 Asset Class Performance Comparison % returns during the six months ended 4/30/2014

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

	8.36%	S&P 500® Index: measures U.S. large-cap stocks
	3.08%	Russell 2000® Index: measures U.S. small-cap stocks
	4.44%	MSCI EAFE® Index (Net): measures (in U.S. dollars) large-cap stocks in Europe, Australasia and the Far East
	1.74%	Barclays U.S. Aggregate Bond Index: measures the U.S. bond market
	0.02%	Barclays U.S. Treasury Bills 1-3 Months Index: 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.

For index definitions, please see the Glossary.

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-month reporting period ended April 30, 2014, the funds’ investment returns generally tracked their respective indices.

up market volatility, increased risk,¹ and reduced returns. Reflecting these conditions, the Russell Fundamental U.S. Large Company Index returned 9.2%, and the Russell Fundamental Emerging Markets Large Company Index returned -4.8%.²

For more information about the performance, holdings, and portfolio characteristics of the Schwab Fundamental Index Funds, please continue reading this report. In addition, you can find further details about these funds by visiting www.schwabfunds.com, or by contacting us at 1-800-435-4000.

Sincerely,

For full definitions of the referenced indices, please see the Glossary.

¹ To find out more information, please read “Investments in Russian Securities” in the “What’s New” section on www.schwabfunds.com.

² The total return cited is for the Russell Fundamental Emerging Markets Large Company Index (Net), which is calculated net of foreign withholding taxes.

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 04/30/14

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)		8.90	%		20.85	%		21.73	%		7.43	%
Russell Fundamental U.S. Large Company Index		9.17	%		21.44	%		n/a			n/a
Fundamental U.S. Large Company Spliced Index		9.17	%		21.44	%		22.04	%		7.63	%
Fund Category: Morningstar Large Value		8.14	%		19.20	%		17.71	%		4.85	%

Fund Expense Ratios⁴: Net 0.35%; Gross 0.41%

 Statistics

Number of Holdings	605
Weighted Average Market Cap ($ x 1,000,000)	$112,159
Price/Earnings Ratio (P/E)	17.4
Price/Book Ratio (P/B)	2.2
Portfolio Turnover Rate5	10%

 Sector Weightings % of Investments

Energy	16.2%
Information Technology	13.2%
Financials	12.8%
Consumer Staples	11.5%
Consumer Discretionary	11.4%
Health Care	11.2%
Industrials	10.3%
Utilities	4.4%
Telecommunication Services	4.3%
Materials	3.9%
Other	0.8%
Total	100.0%

 Top Equity Holdings % of Net Assets⁶

Exxon Mobil Corp.	5.0%
Chevron Corp.	2.5%
AT&T, Inc.	2.1%
ConocoPhillips	2.0%
Microsoft Corp.	2.0%
Verizon Communications, Inc.	1.6%
Hewlett-Packard Co.	1.4%
General Electric Co.	1.4%
The Procter & Gamble Co.	1.4%
Wal-Mart Stores, Inc.	1.4%
Total	20.8%

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.

For index definitions, please see the Glossary.

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 Index Series. 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.

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	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.

6 Schwab Fundamental Index Funds

Schwab Fundamental US Small Company Index Fund

Performance and Fund Facts as of 04/30/14

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)		6.97	%		24.05	%		23.23	%		8.60	%
Russell Fundamental U.S. Small Company Index		7.37	%		24.75	%		n/a			n/a
Fundamental U.S. Small Company Spliced Index		7.37	%		24.75	%		23.86	%		9.21	%
Fund Category: Morningstar Small Blend		4.48	%		21.54	%		19.86	%		6.33	%

Fund Expense Ratios⁴: Net 0.36%; Gross 0.49%

 Statistics

Number of Holdings	845
Weighted Average Market Cap ($ x 1,000,000)	$4,548
Price/Earnings Ratio (P/E)	44.9
Price/Book Ratio (P/B)	2.0
Portfolio Turnover Rate5	7%

 Sector Weightings % of Investments

Financials	20.3%
Industrials	19.1%
Consumer Discretionary	16.4%
Information Technology	14.8%
Energy	6.9%
Health Care	6.8%
Materials	6.1%
Consumer Staples	3.6%
Utilities	3.5%
Telecommunication Services	0.9%
Other	1.6%
Total	100.0%

 Top Equity Holdings % of Net Assets⁶

IntercontinentalExchange Group, Inc.	0.5%
SunEdison, Inc.	0.4%
Trinity Industries, Inc.	0.3%
Avago Technologies Ltd.	0.3%
Kindred Healthcare, Inc.	0.3%
Huntington Ingalls Industries, Inc.	0.3%
SYNNEX Corp.	0.3%
Endo International plc	0.3%
GATX Corp.	0.3%
Aspen Insurance Holdings Ltd.	0.3%
Total	3.3%

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.

For index definitions, please see the Glossary.

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 Index Series. 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.

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 many 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	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.
5	Not annualized.
6	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 04/30/14

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)		6.97	%		20.71	%		13.88	%		2.16	%
Russell Fundamental Developed ex-U.S. Large Company Index (Net)		6.87	%		20.86	%		n/a			n/a
Fundamental Developed ex-U.S. Large Company Spliced Index		6.87	%		20.86	%		14.36	%		3.02	%
Fund Category: Morningstar Foreign Large Value		4.64	%		14.14	%		12.79	%		0.96	%

Fund Expense Ratios⁴: Net 0.35%; Gross 0.52%

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.

For index definitions, please see the Glossary.

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 Index Series. 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.

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	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.

8 Schwab Fundamental Index Funds

 Schwab Fundamental International Large Company Index Fund

Performance and Fund Facts as of 04/30/14 continued

 Statistics

Number of Holdings	794
Weighted Average Market Cap ($ x 1,000,000)	$66,092
Price/Earnings Ratio (P/E)	22.9
Price/Book Ratio (P/B)	1.4
Portfolio Turnover Rate1	4%

 Sector Weightings % of Investments

Financials	18.5%
Energy	14.4%
Industrials	12.6%
Consumer Discretionary	9.6%
Materials	9.5%
Consumer Staples	8.8%
Telecommunication Services	8.3%
Health Care	6.6%
Utilities	5.9%
Information Technology	4.3%
Other	1.5%
Total	100.0%

 Top Equity Holdings % of Net Assets²

BP plc	2.4%
Total S.A.	2.3%
Royal Dutch Shell plc, A Shares	2.0%
Royal Dutch Shell plc, B Shares	1.5%
Banco Santander S.A.	1.3%
HSBC Holdings plc	1.2%
Nestle S.A. – Reg’d	1.1%
Telefonica S.A.	1.1%
Eni S.p.A.	1.1%
Orange S.A.	1.1%
Total	15.1%

 Country Weightings % of Investments

Japan	17.4%
United Kingdom	17.0%
France	11.8%
Germany	9.4%
Canada	6.2%
Netherlands	6.0%
Switzerland	5.7%
Australia	5.1%
Italy	4.9%
Spain	4.7%
Other Countries	11.8%
Total	100.0%

Portfolio holdings may have changed since the report date.

Source of Sector Classification: S&P and MSCI.

International investments are subject to additional risks such as currency fluctuation, geopolitical risk and the potential for illiquid markets.

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 04/30/14

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)		4.59	%		14.47	%		17.11	%		6.45	%
Russell Fundamental Developed ex-U.S. Small Company Index (Net)		4.69	%		14.99	%		n/a			n/a
Fundamental Developed ex-U.S. Small Company Spliced Index		4.69	%		14.99	%		18.16	%		8.01	%
Fund Category: Morningstar Foreign Small/Mid Blend		5.91	%		17.53	%		18.04	%		5.56	%

Fund Expense Ratios⁴: Net 0.50%; Gross 0.94%

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.

For index definitions, please see the Glossary.

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 Index Series. 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.

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	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.

10 Schwab Fundamental Index Funds

 Schwab Fundamental International Small Company Index Fund

Performance and Fund Facts as of 04/30/14 continued

 Statistics

Number of Holdings	1,257
Weighted Average Market Cap ($ x 1,000,000)	$3,684
Price/Earnings Ratio (P/E)	25.6
Price/Book Ratio (P/B)	1.3
Portfolio Turnover Rate1	18%

 Sector Weightings % of Investments

Industrials	24.0%
Consumer Discretionary	18.4%
Financials	16.7%
Materials	10.6%
Information Technology	8.5%
Consumer Staples	7.5%
Energy	4.6%
Health Care	4.3%
Utilities	1.8%
Telecommunication Services	1.1%
Other	2.5%
Total	100.0%

 Top Equity Holdings % of Net Assets²

iShares MSCI EAFE Small Cap ETF	1.8%
Rautaruukki Oyj	0.2%
USG People N.V.	0.2%
Gamesa Corp. Tecnologica S.A.	0.2%
David Jones Ltd.	0.2%
Precision Drilling Corp.	0.2%
Koninklijke Boskalis Westminster N.V.	0.2%
Abengoa S.A., B Shares	0.2%
Faurecia	0.2%
Georg Fischer AG – Reg’d	0.2%
Total	3.6%

 Country Weightings % of Investments

Japan	35.0%
United Kingdom	12.7%
Canada	8.7%
Australia	5.4%
France	4.9%
Germany	3.6%
Switzerland	3.1%
Italy	3.0%
Hong Kong	2.8%
Other Countries	20.8%
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 many other asset classes.

International investments are subject to additional risks such as currency fluctuation, geopolitical risk and the potential for illiquid markets.

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 04/30/14

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)		-4.58	%		-0.83	%		8.81	%		0.50	%
Russell Fundamental Emerging Markets Large Company Index (Net)		-4.79	%		0.00	%		n/a			n/a
Fundamental Emerging Markets Large Company Spliced Index		-4.79	%		0.00	%		10.57	%		2.31	%
Fund Category: Morningstar Diversified Emerging Markets		-1.72	%		-1.55	%		11.17	%		0.20	%

Fund Expense Ratios⁴: Net 0.50%; Gross 0.89%

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.

For index definitions, please see the Glossary.

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 Index Series. 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.

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	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 04/30/14 continued

 Statistics

Number of Holdings	279
Weighted Average Market Cap ($ x 1,000,000)	$48,327
Price/Earnings Ratio (P/E)	10.6
Price/Book Ratio (P/B)	1.0
Portfolio Turnover Rate1	8%

 Sector Weightings % of Investments

Energy	25.0%
Financials	17.4%
Information Technology	15.3%
Materials	12.8%
Telecommunication Services	10.3%
Consumer Discretionary	6.2%
Industrials	5.3%
Utilities	4.2%
Consumer Staples	2.8%
Other	0.7%
Total	100.0%

 Top Equity Holdings % of Net Assets²

Samsung Electronics Co., Ltd.	3.8%
LUKOIL ADR	3.4%
Gazprom ADR	3.3%
Petroleo Brasileiro S.A.	2.3%
China Mobile Ltd.	1.7%
China Construction Bank Corp., Class H	1.7%
Taiwan Semiconductor Manufacturing Co., Ltd.	1.7%
Petroleo Brasileiro S.A. – Petrobras	1.4%
China Petroleum & Chemical Corp., Class H	1.4%
Itau Unibanco Holding S.A., Preferred Stock	1.4%
Total	22.1%

 Country Weightings % of Investments

Republic of Korea	19.8%
Brazil	14.1%
Russia	13.7%
China	12.6%
Taiwan	12.5%
South Africa	7.7%
India	3.8%
Mexico	3.5%
Other Countries	12.3%
Total	100.0%

Portfolio holdings may have changed since the report date.

Source of Sector Classification: S&P and MSCI.

International investments are subject to additional risks such as currency fluctuation, geopolitical risk and the potential for illiquid markets. Investing in emerging markets may accentuate these risks.

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 may incur two types of costs: (1) transaction costs, such as redemption fees; and (2) ongoing costs, including 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, 2013 and held through April 30, 2014.

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 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 a 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. Therefore, the hypothetical return lines of the table are useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, 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 11/1/13		at 4/30/14		11/1/13–4/30/14
Schwab Fundamental US Large Company Index Fund
Actual Return		0.35%	$	1,000.00	$	1,089.00	$	1.81
Hypothetical 5% Return		0.35%	$	1,000.00	$	1,023.06	$	1.76
Schwab Fundamental US Small Company Index Fund
Actual Return		0.35%	$	1,000.00	$	1,069.70	$	1.80
Hypothetical 5% Return		0.35%	$	1,000.00	$	1,023.06	$	1.76
Schwab Fundamental International Large Company Index Fund
Actual Return		0.35%	$	1,000.00	$	1,069.70	$	1.80
Hypothetical 5% Return		0.35%	$	1,000.00	$	1,023.06	$	1.76
Schwab Fundamental International Small Company Index Fund
Actual Return		0.49%	$	1,000.00	$	1,045.90	$	2.49
Hypothetical 5% Return		0.49%	$	1,000.00	$	1,022.36	$	2.46
Schwab Fundamental Emerging Markets Large Company Index Fund
Actual Return		0.49%	$	1,000.00	$	954.20	$	2.37
Hypothetical 5% Return		0.49%	$	1,000.00	$	1,022.36	$	2.46

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

	11/1/13–			11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–
	4/30/14*			10/31/13			10/31/12			10/31/11			10/31/10			10/31/091
Per-Share Data ($)
Net asset value at beginning of period		13.65			10.76			9.51			9.05			7.63			6.47
Income (loss) from investment operations:
Net investment income (loss)		0.14			0.24			0.21			0.18			0.14			0.10
Net realized and unrealized gains (losses)		1.07			2.89			1.22			0.43			1.37			1.26
Total from investment operations		1.21			3.13			1.43			0.61			1.51			1.36
Less distributions:
Distributions from net investment income		(0.22	)		(0.24	)		(0.18	)		(0.15	)		(0.09	)		(0.20	)
Net asset value at end of period		14.64			13.65			10.76			9.51			9.05			7.63
Total return (%)		8.90	2		29.67			15.29			6.74			19.95			22.04
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		0.35	3		0.35			0.32	4		0.35			0.35			0.35
Gross operating expenses		0.39	3		0.41			0.44			0.44			0.45			0.53
Net investment income (loss)		1.97	3		2.03			2.13			2.06			1.77			1.88
Portfolio turnover rate		10	2		10			32	5		11			27			28
Net assets, end of period ($ x 1,000,000)		3,468			3,020			1,960			1,490			1,019			663

* 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, 2014 (Unaudited)

This section shows the fund’s 50 largest portfolio holdings in unaffiliated issuers, and any holdings exceeding 1% of the fund’s 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	.8%	Common Stock		2,448,657,217		3,425,643,615
	0	.7%	Other Investment Company		25,474,573		25,474,573
	0	.1%	Short-Term Investment		1,504,963		1,504,963
	99	.6%	Total Investments		2,475,636,753		3,452,623,151
	0	.3%	Collateral Invested for Securities on Loan		11,391,401		11,391,401
	0	.1%	Other Assets and Liabilities, Net				3,924,123
	100	.0%	Net Assets				3,467,938,675

	Number		% of Net		Value
Security	of Shares		Assets		($)
Common Stock 98.8% of net assets
Automobiles & Components 1.0%
Other Securities				1.0		35,360,814
Banks 5.5%
Bank of America Corp.		2,835,960		1.3		42,936,434
Citigroup, Inc.		530,533		0.7		25,417,836
JPMorgan Chase & Co.		742,342		1.2		41,556,305
Wells Fargo & Co.		678,625		1.0		33,686,945
Other Securities				1.3		45,954,590
				5.5		189,552,110
Capital Goods 7.9%
3M Co.		107,975		0.4		15,018,243
General Electric Co.		1,850,325		1.4		49,755,239
United Technologies Corp.		178,115		0.6		21,076,348
Other Securities				5.5		188,676,860
				7.9		274,526,690
Commercial & Professional Supplies 0.7%
Other Securities				0.7		25,363,446
Consumer Durables & Apparel 0.9%
Other Securities				0.9		32,570,034
Consumer Services 1.5%
McDonald’s Corp.		201,780		0.6		20,456,456
Other Securities				0.9		32,159,020
				1.5		52,615,476
Diversified Financials 2.9%
Berkshire Hathaway, Inc., Class B *		187,411		0.7		24,147,907
The Charles Schwab Corp. (a)		118,815		0.1		3,154,538
Other Securities				2.1		74,783,203
				2.9		102,085,648
Energy 16.1%
Chevron Corp.		680,805		2.5		85,454,644
ConocoPhillips		930,410		2.0		69,138,767
Exxon Mobil Corp.		1,679,384		5.0		171,985,715
Occidental Petroleum Corp.		158,070		0.4		15,135,203
Phillips 66		379,955		0.9		31,619,855
Schlumberger Ltd.		170,100		0.5		17,273,655
Valero Energy Corp.		398,625		0.6		22,789,391
Other Securities				4.2		145,542,993
				16.1		558,940,223
Food & Staples Retailing 4.2%
Costco Wholesale Corp.		119,915		0.4		13,871,767
CVS Caremark Corp.		417,835		0.9		30,384,961
Wal-Mart Stores, Inc.		608,125		1.4		48,473,644
Walgreen Co.		287,170		0.6		19,498,843
Other Securities				0.9		31,813,408
				4.2		144,042,623
Food, Beverage & Tobacco 5.2%
Altria Group, Inc.		410,580		0.5		16,468,364
Mondelez International, Inc., Class A		455,392		0.5		16,234,725
PepsiCo, Inc.		267,708		0.6		22,993,440
Philip Morris International, Inc.		288,420		0.7		24,639,720
The Coca-Cola Co.		480,830		0.6		19,613,056
Other Securities				2.3		79,037,391
				5.2		178,986,696
Health Care Equipment & Services 5.6%
Abbott Laboratories		411,390		0.5		15,937,249
UnitedHealth Group, Inc.		325,575		0.7		24,431,148
WellPoint, Inc.		234,770		0.7		23,636,644
Other Securities				3.7		128,611,576
				5.6		192,616,617
Household & Personal Products 2.1%
The Procter & Gamble Co.		597,595		1.4		49,331,467
Other Securities				0.7		23,745,601
				2.1		73,077,068

16 See financial notes

 Schwab Fundamental US Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		% of Net		Value
Security	of Shares		Assets		($)
Insurance 3.4%
The Travelers Cos., Inc.		192,695		0.5		17,454,313
Other Securities				2.9		98,952,141
				3.4		116,406,454
Materials 3.9%
Other Securities				3.9		134,997,529
Media 3.7%
Comcast Corp., Class A		352,140		0.5		18,226,767
The Walt Disney Co.		281,350		0.6		22,322,309
Time Warner, Inc.		287,988		0.6		19,139,683
Other Securities				2.0		69,120,578
				3.7		128,809,337
Pharmaceuticals, Biotechnology & Life Sciences 5.6%
Amgen, Inc.		141,655		0.5		15,829,946
Johnson & Johnson		441,395		1.3		44,708,900
Merck & Co., Inc.		422,557		0.7		24,744,938
Pfizer, Inc.		1,349,299		1.2		42,206,073
Other Securities				1.9		66,062,447
				5.6		193,552,304
Real Estate 1.0%
Other Securities				1.0		35,572,880
Retailing 4.2%
Lowe’s Cos., Inc.		337,055		0.5		15,474,195
Target Corp.		266,995		0.5		16,486,941
The Home Depot, Inc.		235,796		0.5		18,748,140
Other Securities				2.7		94,144,861
				4.2		144,854,137
Semiconductors & Semiconductor Equipment 2.4%
Intel Corp.		1,501,810		1.2		40,083,309
Other Securities				1.2		41,464,001
				2.4		81,547,310
Software & Services 6.3%
International Business Machines Corp.		243,495		1.4		47,839,463
Microsoft Corp.		1,696,315		2.0		68,531,126
Oracle Corp.		412,460		0.5		16,861,365
Other Securities				2.4		84,107,991
				6.3		217,339,945
Technology Hardware & Equipment 4.5%
Apple, Inc.		45,617		0.8		26,918,136
Cisco Systems, Inc.		1,012,565		0.7		23,400,377
Hewlett-Packard Co.		1,513,675		1.4		50,042,095
Other Securities				1.6		55,169,146
				4.5		155,529,754
Telecommunication Services 4.2%
AT&T, Inc.		2,048,385		2.1		73,127,344
Verizon Communications, Inc.		1,175,230		1.6		54,918,498
Other Securities				0.5		19,267,663
				4.2		147,313,505
Transportation 1.6%
Other Securities				1.6		56,443,207
Utilities 4.4%
Other Securities				4.4		153,539,808
Total Common Stock
(Cost $2,448,657,217)						3,425,643,615
Other Investment Company 0.7% of net assets
Money Market Fund 0.7%
State Street Institutional U.S. Government Money Market Fund, Institutional Class 0.00% (e)		25,474,573		0.7		25,474,573
Total Other Investment Company
(Cost $25,474,573)						25,474,573
	Face
Security	Amount		% of Net		Value
Rate, Maturity Date	($)		Assets		($)
Short-Term Investment 0.1% of net assets
U.S. Treasury Obligation 0.1%
Other Securities				0.1		1,504,963
Total Short-Term Investment
(Cost $1,504,963)						1,504,963
End of Investments.
	Number		% of Net		Value
Security	of Shares		Assets		($)
Collateral Invested for Securities on Loan 0.3% of net assets
State Street Institutional U.S. Government Money Market Fund, Institutional Class 0.00% (e)		11,391,401		0.3		11,391,401
Total Collateral Invested for Securities on Loan
(Cost $11,391,401)						11,391,401
End of Collateral Invested for Securities on Loan.

At 04/30/14 tax basis cost of the fund’s investments was $2,491,750,930 and the unrealized appreciation and depreciation were $978,046,927 and ($17,174,706), respectively, with a net unrealized appreciation of $960,872,221.

See financial notes 17

 Schwab Fundamental US Large Company Index Fund

Portfolio Holdings (Unaudited) continued

For the following notes, please refer to the complete schedule of portfolio 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. Securities on loan were valued at $13,153,104.
(c)	All or a portion of this security is held as collateral for open futures contracts.
(d)	The rate shown is the purchase yield.
(e)	The rate shown is the 7-day yield.

REIT — Real Estate Investment Trust

In addition to the above, the fund held the following at 04/30/14:

			Contract		Unrealized
	Number of		Value		Appreciation
	Contracts		($)		($)
Futures Contracts
S&P 500 Index, e-mini, Long, expires 06/20/14		370		34,741,150		542,850

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2014 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Other Significant		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Common Stock1		$3,425,643,615		$—		$—		$3,425,643,615
Other Investment Company1		25,474,573		—		—		25,474,573
Short-Term Investments1		—		1,504,963		—		1,504,963
Total		$3,451,118,188		$1,504,963		$—		$3,452,623,151
Other Financial Instruments
Collateral Invested for Securities on Loan		$11,391,401		$—		$—		$11,391,401
Futures Contracts2		542,850		—		—		542,850

1	As categorized in the complete schedule of portfolio holdings.
2	Futures contracts are not included in Investments in the schedule of portfolio holdings 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, 2014.

18 See financial notes

 Schwab Fundamental US Large Company Index Fund

Statement of

Assets and Liabilities

As of April 30, 2014; unaudited

Assets
Investments in affiliated issuers, at value (cost $1,954,261)		$3,154,538
Investments in unaffiliated issuers, at value (cost $2,473,682,492) including securities on loan of $13,153,104	+	3,449,468,613
Total investments, at value (cost $2,475,636,753)		3,452,623,151
Collateral invested for securities on loan		11,391,401
Receivables:
Investments sold		1,903,074
Fund shares sold		12,751,957
Dividends		3,879,079
Variation margin on futures contracts		84,212
Income from securities on loan		76,110
Prepaid expenses	+	16,281
Total assets		3,482,725,265
Liabilities
Collateral held for securities on loan		11,391,401
Payables:
Investment adviser and administrator fees		54,525
Shareholder service fees		94,442
Fund shares redeemed		2,389,225
Accrued expenses	+	856,997
Total liabilities		14,786,590
Net Assets
Total assets		3,482,725,265
Total liabilities	−	14,786,590
Net assets		$3,467,938,675
Net Assets by Source
Capital received from investors		2,416,602,936
Net investment income not yet distributed		21,611,866
Net realized capital gains		52,194,625
Net unrealized capital appreciation		977,529,248
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$3,467,938,675		236,823,280			$14.64

See financial notes 19

 Schwab Fundamental US Large Company Index Fund

Statement of

Operations

For the period November 1, 2013 through April 30, 2014; unaudited

Investment Income
Dividends received from affiliated issuer		$15,632
Dividends received from unaffiliated issuers (net of foreign withholding taxes of $6,988)		38,141,883
Interest		1,090
Securities on loan	+	302,977
Total investment income		38,461,582
Expenses
Investment adviser and administrator fees		3,845,692
Shareholder service fees		1,368,227
Index fee		988,210
Shareholder reports		67,106
Portfolio accounting fees		51,149
Transfer agent fees		48,017
Registration fees		40,136
Custodian fees		31,411
Professional fees		30,971
Independent trustees’ fees		10,725
Interest expense		802
Other expenses	+	29,395
Total expenses		6,511,841
Expense reduction by CSIM and its affiliates	−	708,459
Net expenses	−	5,803,382
Net investment income		32,658,200
Realized and Unrealized Gains (Losses)
Net realized gains on affiliated issuer		280,468
Net realized gains on unaffiliated investments		77,071,735
Net realized gains on futures contracts	+	4,382,029
Net realized gains		81,734,232
Net change in unrealized appreciation (depreciation) on affiliated issuer		280,251
Net change in unrealized appreciation (depreciation) on unaffiliated investments		180,793,086
Net change in unrealized appreciation (depreciation) on futures contracts	+	66,074
Net change in unrealized appreciation (depreciation)	+	181,139,411
Net realized and unrealized gains		262,873,643
Increase in net assets resulting from operations		$295,531,843

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

11/1/13-4/30/14				11/1/12-10/31/13
Net investment income		$32,658,200			$50,722,157
Net realized gains		81,734,232			57,736,284
Net change in unrealized appreciation (depreciation)	+	181,139,411			523,232,112
Increase in net assets from operations		295,531,843			631,690,553
Distributions to Shareholders
Distributions from net investment income		($47,960,089	)		($42,909,493	)

Transactions in Fund Shares

		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		VALUE			SHARES		VALUE
Shares sold			71,233,929		$996,719,796			84,032,984		$1,024,135,625
Shares reinvested			2,075,077		29,051,072			2,230,842		23,803,086
Shares redeemed	+		(57,731,866	)	(825,835,465	)		(47,078,841	)	(576,085,377	)
Net transactions in fund shares			15,577,140		$199,935,403			39,184,985		$471,853,334
Shares Outstanding and Net Assets
		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			221,246,140		$3,020,431,518			182,061,155		$1,959,797,124
Total increase	+		15,577,140		447,507,157			39,184,985		1,060,634,394
End of period			236,823,280		$3,467,938,675			221,246,140		$3,020,431,518
Net investment income not yet distributed					$21,611,866					$36,913,755

See financial notes 21

Schwab Fundamental US Small Company Index Fund

Financial Statements

Financial Highlights

	11/1/13–			11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–
	4/30/14*			10/31/13			10/31/12			10/31/11			10/31/10			10/31/091
Per-Share Data ($)
Net asset value at beginning of period		12.78			10.31			10.11			10.10			7.88			6.30
Income (loss) from investment operations:
Net investment income (loss)		0.07			0.16			0.15			0.11			0.09			0.06
Net realized and unrealized gains (losses)		0.81			3.35			0.88			0.47			2.19			1.59
Total from investment operations		0.88			3.51			1.03			0.58			2.28			1.65
Less distributions:
Distributions from net investment income		(0.12	)		(0.20	)		(0.12	)		(0.10	)		(0.06	)		(0.07	)
Distributions from net realized gains		(0.52	)		(0.84	)		(0.71	)		(0.47	)		—			—
Total distributions		(0.64	)		(1.04	)		(0.83	)		(0.57	)		(0.06	)		(0.07	)
Net asset value at end of period		13.02			12.78			10.31			10.11			10.10			7.88
Total return (%)		6.97	2		37.55			11.37			5.55			29.07			26.68
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		0.35	3		0.35			0.32	4		0.35			0.35			0.35
Gross operating expenses		0.45	3		0.48			0.50			0.50			0.53			0.60
Net investment income (loss)		1.19	3		1.41			1.46			1.18			1.03			1.00
Portfolio turnover rate		7	2		27			92	5		35			41			29
Net assets, end of period ($ x 1,000,000)		1,134			849			619			563			412			298

* 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, 2014 (Unaudited)

This section shows the fund’s 50 largest portfolio holdings in unaffiliated issuers, and any holdings exceeding 1% of the fund’s 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	.3%	Common Stock		849,941,868		1,115,345,025
	0	.0%	Rights		266,856		266,364
	1	.3%	Other Investment Company		14,922,078		14,922,078
	0	.3%	Short-Term Investment		3,049,793		3,049,793
	99	.9%	Total Investments		868,180,595		1,133,583,260
	2	.7%	Collateral Invested for Securities on Loan		30,398,073		30,398,073
	(2	.6)%	Other Assets and Liabilities, Net				(29,549,057	)
	100	.0%	Net Assets				1,134,432,276

	Number		% of Net		Value
Security	of Shares		Assets		($)
Common Stock 98.3% of net assets
Automobiles & Components 0.9%
Other Securities				0.9		10,559,373
Banks 4.1%
Other Securities				4.1	��	47,122,475
Capital Goods 11.1%
Carlisle Cos., Inc.		33,600		0.3		2,763,600
GATX Corp.		47,800		0.3		3,137,114
Huntington Ingalls Industries, Inc.		32,000		0.3		3,296,000
Spirit AeroSystems Holdings, Inc., Class A *		85,900		0.2		2,579,577
Trinity Industries, Inc.		49,100		0.3		3,685,446
Other Securities				9.7		110,110,022
				11.1		125,571,759
Commercial & Professional Supplies 4.3%
Nielsen Holdings N.V.		63,600		0.3		2,986,020
Other Securities				4.0		45,921,924
				4.3		48,907,944
Consumer Durables & Apparel 3.5%
Hanesbrands, Inc.		31,600		0.2		2,594,044
Other Securities				3.3		36,942,147
				3.5		39,536,191
Consumer Services 4.8%
Career Education Corp. *		380,900		0.2		2,750,098
DeVry Education Group, Inc.		64,700		0.3		2,913,441
Las Vegas Sands Corp.		36,500		0.3		2,888,245
Other Securities				4.0		45,581,847
				4.8		54,133,631
Diversified Financials 3.6%
IntercontinentalExchange Group, Inc.		27,600		0.5		5,642,544
Other Securities				3.1		35,086,246
				3.6		40,728,790
Energy 6.8%
Denbury Resources, Inc.		155,500		0.2		2,615,510
Dresser-Rand Group, Inc. *		43,800		0.2		2,647,272
Exterran Holdings, Inc.		64,500		0.2		2,774,790
Superior Energy Services, Inc.		79,800		0.2		2,627,016
Unit Corp. *		39,100		0.2		2,578,645
Western Refining, Inc. (a)		65,100		0.3		2,831,850
Whiting Petroleum Corp. *		38,700		0.3		2,852,964
Other Securities				5.2		58,757,536
				6.8		77,685,583
Food & Staples Retailing 0.9%
Other Securities				0.9		10,816,292
Food, Beverage & Tobacco 2.2%
Other Securities				2.2		24,620,308
Health Care Equipment & Services 4.6%
Kindred Healthcare, Inc.		135,000		0.3		3,388,500
Other Securities				4.3		48,465,850
				4.6		51,854,350
Household & Personal Products 0.4%
Other Securities				0.4		4,939,051
Insurance 4.0%
Aspen Insurance Holdings Ltd.		68,400		0.3		3,131,352
CNO Financial Group, Inc.		163,300		0.3		2,816,925
Old Republic International Corp.		163,000		0.2		2,699,280
Primerica, Inc.		58,200		0.2		2,670,798
Protective Life Corp.		53,500		0.2		2,736,525
Other Securities				2.8		31,823,474
				4.0		45,878,354
Materials 6.1%
AK Steel Holding Corp. *(a)		410,800		0.3		2,875,600
Cabot Corp.		51,000		0.3		2,947,800
Crown Holdings, Inc. *		60,200		0.2		2,839,634

See financial notes 23

 Schwab Fundamental US Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		% of Net		Value
Security	of Shares		Assets		($)
Resolute Forest Products, Inc. *		159,200		0.2		2,840,128
Schnitzer Steel Industries, Inc., Class A		91,810		0.2		2,577,107
Other Securities				4.9		55,324,035
				6.1		69,404,304
Media 2.1%
Scripps Networks Interactive, Inc., Class A		35,000		0.2		2,627,450
Other Securities				1.9		21,828,928
				2.1		24,456,378
Pharmaceuticals, Biotechnology & Life Sciences 2.3%
Endo International plc *		50,300		0.3		3,166,134
Other Securities				2.0		22,504,689
				2.3		25,670,823
Real Estate 8.5%
Duke Realty Corp.		151,400		0.2		2,652,528
Essex Property Trust, Inc.		14,909		0.2		2,583,133
General Growth Properties, Inc.		122,600		0.3		2,816,122
Jones Lang LaSalle, Inc.		23,100		0.2		2,677,059
Other Securities				7.6		85,563,593
				8.5		96,292,435
Retailing 5.1%
ANN, Inc. *		66,000		0.2		2,586,540
Office Depot, Inc. *		661,858		0.2		2,706,999
The Men’s Wearhouse, Inc.		58,100		0.3		2,752,778
Other Securities				4.4		49,618,551
				5.1		57,664,868
Semiconductors & Semiconductor Equipment 4.4%
Advanced Micro Devices, Inc. *(a)		636,000		0.2		2,601,240
Avago Technologies Ltd.		56,300		0.3		3,575,050
SunEdison, Inc. *		201,100		0.4		3,867,153
Other Securities				3.5		39,603,754
				4.4		49,647,197
Software & Services 5.8%
Activision Blizzard, Inc.		130,800		0.2		2,617,308
Convergys Corp.		134,800		0.3		2,903,592
Facebook, Inc., Class A *		43,100		0.2		2,576,518
Other Securities				5.1		57,341,272
				5.8		65,438,690
Technology Hardware & Equipment 4.7%
Sanmina Corp. *		127,100		0.2		2,573,775
SYNNEX Corp. *		47,400		0.3		3,193,812
Other Securities				4.2		47,304,002
				4.7		53,071,589
Telecommunication Services 0.9%
Other Securities				0.9		9,966,943
Transportation 3.7%
Alaska Air Group, Inc.		29,700		0.3		2,794,176
Southwest Airlines Co.		114,300		0.2		2,762,631
Other Securities				3.2		36,554,971
				3.7		42,111,778
Utilities 3.5%
Other Securities				3.5		39,265,919
Total Common Stock
(Cost $849,941,868)						1,115,345,025
Rights 0.0% of net assets
Technology Hardware & Equipment 0.0%
Other Securities				0.0		—
Telecommunication Services 0.0%
Other Securities				0.0		266,364
Total Rights
(Cost $266,856)						266,364
Other Investment Company 1.3% of net assets
Money Market Fund 1.3%
State Street Institutional U.S. Government Money Market Fund, Institutional Class 0.00% (f)		14,922,078		1.3		14,922,078
Total Other Investment Company
(Cost $14,922,078)						14,922,078
	Face
Security	Amount		% of Net		Value
Rate, Maturity Date	($)		Assets		($)
Short-Term Investment 0.3% of net assets
U.S. Treasury Obligation 0.3%
U.S. Treasury Bill
0.05%, 06/19/14 (d)(e)		3,050,000		0.3		3,049,793
Total Short-Term Investment
(Cost $3,049,793)						3,049,793
End of Investments.

24 See financial notes

 Schwab Fundamental US Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	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, Institutional Class 0.00% (f)		30,398,073		2.7		30,398,073
Total Collateral Invested for Securities on Loan
(Cost $30,398,073)						30,398,073
End of Collateral Invested for Securities on Loan.

At 04/30/14 tax basis cost of the fund’s investments was $871,766,214 and the unrealized appreciation and depreciation were $278,770,901 and ($16,953,855), respectively, with a net unrealized appreciation of $261,817,046.

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

*	Non-income producing security.
(a)	All or a portion of this security is on loan. Securities on loan were valued at $32,086,117.
(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 $266,364 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.
(f)	The rate shown is the 7-day yield.

CVR —	Contingent Value Rights
REIT —	Real Estate Investment Trust

In addition to the above, the fund held the following at 04/30/14:

			Contract		Unrealized
	Number of		Value		Depreciation
	Contracts		($)		($)
Futures Contracts
Russell 2000 Index, mini, Long, expires 06/20/14		160		17,977,600		(414,961	)

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2014 (see financial note 2(a) for additional information):

Assets Valuation Input

	Quoted Prices in					Significant
	Active Markets for			Other Significant		Unobservable
	Identical Assets			Observable Inputs		Inputs
Description	(Level 1)			(Level 2)		(Level 3)		Total
Common Stock1		$1,115,345,025			$—		$—		$1,115,345,025
Rights1		—			—		266,364		266,364
Other Investment Company1		14,922,078			—		—		14,922,078
Short-Term Investment1		—			3,049,793		—		3,049,793
Total		$1,130,267,103			$3,049,793		$266,364		$1,133,583,260
Other Financial Instruments
Collateral Invested for Securities on Loan		$30,398,073			$—		$—		$30,398,073
Liabilities Valuation Input
Other Financial Instruments
Futures Contracts2		($414,961	)		$—		$—		($414,961	)

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

See financial notes 25

 Schwab Fundamental US 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		Appreciation		Gross		Gross		Transfers		Transfers		April 30,
Investments in Securities	2013		(Losses)		(Depreciation)		Purchases		Sales		in		out		2014
Rights		$—		$—		$—		$266,364		$—		$—		$—		$266,364
Total		$—		$—		$—		$266,364		$—		$—		$—		$266,364

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, 2014.

26 See financial notes

 Schwab Fundamental US Small Company Index Fund

Statement of

Assets and Liabilities

As of April 30, 2014; unaudited

Assets
Investments, at value (cost $868,180,595) including securities on loan of $32,086,117		$1,133,583,260
Foreign currency, at value (cost $34)		32
Cash		709,430
Collateral invested for securities on loan		30,398,073
Receivables:
Fund shares sold		1,115,067
Dividends		442,520
Variation margin on futures contracts		116,800
Income from securities on loan		88,147
Prepaid expenses	+	6,526
Total assets		1,166,459,855
Liabilities
Collateral held for securities on loan		30,398,073
Payables:
Investment adviser and administrator fees		18,288
Shareholder service fees		14,002
Fund shares redeemed		1,302,051
Accrued expenses	+	295,165
Total liabilities		32,027,579
Net Assets
Total assets		1,166,459,855
Total liabilities	−	32,027,579
Net assets		$1,134,432,276
Net Assets by Source
Capital received from investors		845,820,249
Net investment income not yet distributed		3,173,417
Net realized capital gains		20,450,874
Net unrealized capital appreciation		264,987,736
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$1,134,432,276		87,106,805			$13.02

See financial notes 27

 Schwab Fundamental US Small Company Index Fund

Statement of

Operations

For the period November 1, 2013 through April 30, 2014; unaudited

Investment Income
Dividends (net of foreign withholding taxes of $7,959)		$7,353,039
Interest		493
Securities on loan	+	356,870
Total investment income		7,710,402
Expenses
Investment adviser and administrator fees		1,297,049
Shareholder service fees		434,343
Index fee		297,986
Transfer agent fees		46,234
Shareholder reports		37,357
Portfolio accounting fees		30,760
Professional fees		24,027
Registration fees		20,961
Custodian fees		19,906
Independent trustees’ fees		5,214
Interest expense		179
Other expenses	+	8,786
Total expenses		2,222,802
Expense reduction by CSIM and its affiliates	−	474,703
Net expenses	−	1,748,099
Net investment income		5,962,303
Realized and Unrealized Gains (Losses)
Net realized gains on investments		23,998,981
Net realized losses on futures contracts		(196,770	)
Net realized gains on foreign currency transactions	+	628
Net realized gains		23,802,839
Net change in unrealized appreciation (depreciation) on investments		38,207,837
Net change in unrealized appreciation (depreciation) on futures contracts		(639,518	)
Net change in unrealized appreciation (depreciation) on foreign currency translations	+	30
Net change in unrealized appreciation (depreciation)	+	37,568,349
Net realized and unrealized gains		61,371,188
Increase in net assets resulting from operations		$67,333,491

28 See financial notes

 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

11/1/13-4/30/14				11/1/12-10/31/13
Net investment income		$5,962,303			$10,235,724
Net realized gains		23,802,839			35,664,271
Net change in unrealized appreciation (depreciation)	+	37,568,349			183,388,180
Increase in net assets from operations		67,333,491			229,288,175
Distributions to Shareholders
Distributions from net investment income		(8,210,484	)		(11,947,531	)
Distributions from net realized gains	+	(37,238,379	)		(50,580,881	)
Total distributions		($45,448,863	)		($62,528,412	)

Transactions in Fund Shares

		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		VALUE			SHARES		VALUE
Shares sold			24,957,639		$319,457,961			16,241,608		$178,159,226
Shares reinvested			1,787,741		22,900,966			2,784,659		26,509,953
Shares redeemed	+		(6,113,557	)	(79,223,700	)		(12,560,146	)	(140,960,955	)
Net transactions in fund shares			20,631,823		$263,135,227			6,466,121		$63,708,224
Shares Outstanding and Net Assets
		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			66,474,982		$849,412,421			60,008,861		$618,944,434
Total increase	+		20,631,823		285,019,855			6,466,121		230,467,987
End of period			87,106,805		$1,134,432,276			66,474,982		$849,412,421
Net investment income not yet distributed					$3,173,417					$5,421,598

See financial notes 29

Schwab Fundamental International Large Company Index Fund

Financial Statements

Financial Highlights

	11/1/13–			11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–
	4/30/14*			10/31/13			10/31/12			10/31/11			10/31/10			10/31/091
Per-Share Data ($)
Net asset value at beginning of period		9.05			7.16			7.26			8.09			7.69			6.01
Income (loss) from investment operations:
Net investment income (loss)		0.17			0.23			0.22			0.23			0.21			0.16
Net realized and unrealized gains (losses)		0.45			1.87			(0.08	)2		(0.85	)		0.41			1.81
Total from investment operations		0.62			2.10			0.14			(0.62	)		0.62			1.97
Less distributions:
Distributions from net investment income		(0.25	)		(0.21	)		(0.24	)		(0.21	)		(0.22	)		(0.29	)
Net asset value at end of period		9.42			9.05			7.16			7.26			8.09			7.69
Total return (%)		6.97	3		30.12			2.24			(7.88	)		8.27			34.89
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		0.35	4		0.34	5		0.31	5		0.35			0.35			0.35
Gross operating expenses		0.48	4		0.52			0.56			0.57			0.61			0.76
Net investment income (loss)		4.18	4		2.95			3.58			3.24			2.70			2.80
Portfolio turnover rate		4	3		22			61	6		35			65			82
Net assets, end of period ($ x 1,000,000)		847			646			501			372			301			253

* 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.

⁶ Portfolio turnover would have been 37%, if rebalancing trades had not been included due to a change in the fund’s index.

30 See financial notes

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings as of April 30, 2014 (Unaudited)

This section shows the fund’s 50 largest portfolio holdings in unaffiliated issuers, and any holdings exceeding 1% of the fund’s 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	.6%	Common Stock		654,983,799		826,627,338
	0	.4%	Preferred Stock		2,226,152		3,612,619
	0	.0%	Rights		228,127		233,309
	0	.0%	Warrants		140,410		203,445
	0	.0%	Other Investment Company		4,656		6,832
	1	.5%	Short-Term Investments		12,115,904		12,115,904
	99	.5%	Total Investments		669,699,048		842,799,447
	3	.0%	Collateral Invested for Securities on Loan		25,081,669		25,081,669
	(2	.5%)	Other Assets and Liabilities, Net				(20,828,764	)
	100	.0%	Net Assets				847,052,352

	Number		% of Net		Value
Security	of Shares		Assets		($)
Common Stock 97.6% of net assets
Australia 5.0%
BHP Billiton Ltd.		168,814		0.7		5,945,054
Other Securities				4.3		36,765,160
				5.0		42,710,214
Austria 0.4%
Other Securities				0.4		3,221,082
Belgium 0.9%
Other Securities				0.9		7,564,184
Canada 6.2%
Other Securities				6.2		52,155,502
Denmark 0.9%
Other Securities				0.9		7,676,724
Finland 1.3%
Nokia Oyj *		632,078		0.6		4,732,728
Other Securities				0.7		5,949,566
				1.3		10,682,294
France 11.7%
AXA S.A.		124,494		0.4		3,248,797
BNP Paribas S.A.		63,868		0.6		4,799,326
Carrefour S.A.		84,569		0.4		3,296,588
Compagnie de Saint-Gobain		61,846		0.4		3,789,023
GDF Suez (c)		180,020		0.5		4,537,121
Orange S.A.		552,437		1.0		8,950,182
Sanofi		59,085		0.7		6,376,444
Total S.A.		267,352		2.3		19,127,473
Vivendi S.A.		151,219		0.5		4,062,763
Other Securities				4.9		41,275,898
				11.7		99,463,615
Germany 8.9%
Allianz SE - Reg’d		26,886		0.5		4,678,966
BASF SE		63,614		0.9		7,379,587
Bayer AG - Reg’d		31,374		0.5		4,362,293
Daimler AG - Reg’d		73,177		0.8		6,812,715
Deutsche Telekom AG - Reg’d		396,393		0.8		6,659,822
E.ON SE		338,535		0.8		6,484,586
RWE AG		89,441		0.4		3,413,165
Siemens AG - Reg’d		45,683		0.7		6,026,512
Other Securities				3.5		29,457,990
				8.9		75,275,636
Hong Kong 0.9%
Other Securities				0.9		7,812,699
Ireland 0.7%
Other Securities				0.7		5,469,098
Israel 0.3%
Other Securities				0.3		2,842,463
Italy 4.9%
Enel S.p.A.		1,040,084		0.7		5,890,963
Eni S.p.A.		350,949		1.1		9,089,339
Intesa Sanpaolo S.p.A.		1,328,656		0.5		4,546,699
Telecom Italia S.p.A. *		2,651,114		0.4		3,406,756
UniCredit S.p.A.		568,807		0.6		5,096,308
Other Securities				1.6		13,613,740
				4.9		41,643,805
Japan 17.3%
Canon, Inc.		105,300		0.4		3,299,570
Honda Motor Co., Ltd.		103,600		0.4		3,437,931
Nippon Telegraph & Telephone Corp.		64,904		0.4		3,601,701
Toyota Motor Corp.		112,500		0.7		6,078,167
Other Securities				15.4		129,946,582
				17.3		146,363,951

See financial notes 31

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		% of Net		Value
Security	of Shares		Assets		($)
Luxembourg 0.6%
ArcelorMittal		227,568		0.4		3,700,537
Other Securities				0.2		1,653,186
				0.6		5,353,723
Netherlands 6.0%
Royal Dutch Shell plc, A Shares		437,864		2.0		17,320,923
Royal Dutch Shell plc, B Shares		292,122		1.5		12,403,789
Other Securities				2.5		21,068,163
				6.0		50,792,875
New Zealand 0.1%
Other Securities				0.1		968,626
Norway 1.0%
Statoil A.S.A. (c)		135,531		0.5		4,131,716
Other Securities				0.5		3,979,004
				1.0		8,110,720
Portugal 0.3%
Other Securities				0.3		2,815,610
Singapore 0.7%
Other Securities				0.7		5,854,262
Spain 4.6%
Banco Bilbao Vizcaya Argentaria S.A.		392,327		0.6		4,832,580
Banco Santander S.A. (c)		1,148,681		1.3		11,424,399
Repsol S.A.		122,406		0.4		3,295,715
Telefonica S.A.		575,622		1.1		9,660,152
Other Securities				1.2		10,114,320
				4.6		39,327,166
Sweden 2.3%
Other Securities				2.3		19,383,649
Switzerland 5.7%
Nestle S.A. - Reg’d		124,406		1.1		9,614,626
Novartis AG - Reg’d		78,095		0.8		6,788,993
Roche Holding AG		17,003		0.6		4,987,764
Other Securities				3.2		26,704,540
				5.7		48,095,923
United Kingdom 16.9%
Anglo American plc		168,882		0.5		4,514,739
AstraZeneca plc		103,317		1.0		8,155,285
Barclays plc		971,217		0.5		4,147,138
BP plc		2,421,967		2.4		20,448,938
British American Tobacco plc		72,547		0.5		4,189,221
GlaxoSmithKline plc		279,216		0.9		7,714,887
HSBC Holdings plc		1,022,495		1.2		10,447,456
Rio Tinto plc		69,892		0.5		3,799,866
Tesco plc		812,058		0.5		4,022,874
Vodafone Group plc		2,087,463		0.9		7,925,277
Other Securities				8.0		67,677,836
				16.9		143,043,517
Total Common Stock
(Cost $654,983,799)						826,627,338
Preferred Stock 0.4% of net assets
Germany 0.4%
Other Securities				0.4		3,600,146
United Kingdom 0.0%
Other Securities				0.0		12,473
Total Preferred Stock
(Cost $2,226,152)						3,612,619
Rights 0.0% of net assets
Spain 0.0%
Banks 0.0%
Other Securities				0.0		233,309
Total Rights
(Cost $228,127)						233,309
Warrants 0.0% of net assets
France 0.0%
Other Securities				0.0		202,716
Hong Kong 0.0%
Other Securities				0.0		729
Total Warrants
(Cost $140,410)						203,445
Other Investment Company 0.0% of net assets
United States 0.0%
Other Securities				0.0		6,832
Total Other Investment Company
(Cost $4,656)						6,832
	Face
Security	Amount		% of Net		Value
Rate, Maturity Date	($)		Assets		($)
Short-Term Investments 1.5% of net assets
Time Deposits 1.2%
Bank of Tokyo Mitsubishi
0.03%, 05/01/14		9,796,278		1.2		9,796,278
Other Securities				0.0		319,762
				1.2		10,116,040

32 See financial notes

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Face
Security	Amount		% of Net		Value
Rate, Maturity Date	($)		Assets		($)
U.S. Treasury Obligation 0.3%
Other Securities				0.3		1,999,864
Total Short-Term Investments
(Cost $12,115,904)						12,115,904
End of Investments.
	Number		% of Net		Value
Security	of Shares		Assets		($)
Collateral Invested for Securities on Loan 3.0% of net assets
Wells Fargo Advantage Government Money Market Fund, Institutional Class 0.01% (f)		25,081,669		3.0		25,081,669
Total Collateral Invested for Securities on Loan
(Cost $25,081,669)						25,081,669
End of Collateral Invested for Securities on Loan.

At 04/30/14, the tax basis cost of the fund’s investments was $686,731,653 and the unrealized appreciation and depreciation were $167,048,529 and ($10,980,735), respectively, with a net unrealized appreciation of $156,067,794

At 04/30/14, the values of certain foreign securities held by the fund aggregating $765,673,707 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(a) for additional information)

For the following notes, please refer to the complete schedule of portfolio 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 $246,511 or 0.0% of net assets.
(c)	All or a portion of this security is on loan. Securities on loan were valued at $23,139,166.
(d)	The rate shown is the purchase yield.
(e)	All or a portion of this security is held as collateral for futures contracts.
(f)	The rate shown is the 7-day yield.

CVA —	Dutch Certificate
ETF —	Exchange traded fund
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 04/30/14:

			Contract		Unrealized
	Number of		Value		Appreciation
	Contracts		($)		($)
Futures Contracts
MSCI EAFE, e-mini, Long, expires 06/20/14		115		11,064,725		424,212

See financial notes 33

 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, 2014 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Other Significant		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Common Stock1		$—		$303,650,482		$—		$303,650,482
Australia		311,299		42,398,915		—		42,710,214
Canada		52,155,502		—		—		52,155,502
Denmark		657,279		7,019,445		—		7,676,724
Finland		657,255		10,025,039		—		10,682,294
France		372,409		99,091,206		—		99,463,615
Germany		205,723		75,069,913		—		75,275,636
Hong Kong		194,907		7,617,792		—		7,812,699
Ireland		1,617,621		3,851,477		—		5,469,098
Luxembourg		483,474		4,870,249		—		5,353,723
Singapore		652,809		5,201,453		—		5,854,262
Sweden		507,045		18,876,604		—		19,383,649
Switzerland		4,062,572		44,033,351		—		48,095,923
United Kingdom		2,675,882		140,367,635		—		143,043,517
Preferred Stock1		—		3,600,146		—		3,600,146
United Kingdom		—		—		12,473		12,473
Rights1		—		—		233,309		233,309
Warrants1		203,445		—		—		203,445
Other Investment Company1		6,832		—		—		6,832
Short-Term Investments1		—		12,115,904		—		12,115,904
Total		$64,764,054		$777,789,611		$245,782		$842,799,447
Other Financial Instruments
Collateral Invested for Securities on Loan		$25,081,669		$—		$—		$25,081,669
Futures Contracts2		424,212		—		—		424,212

1	As categorized in the complete schedule of portfolio holdings.
2	Futures contracts are not included in Investments in the schedule of portfolio holdings 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		Appreciation			Gross		Gross			Transfers		Transfers		April 30,
Investments in Securities	2013		(Losses)		(Depreciation)			Purchases		Sales			in		out		2014
Preferred Stock
United Kingdom		$5,981		$66		$128			$12,395		($6,097	)		$—		$—		$12,473
Rights
Spain		185,237		—		(3,171	)		228,127		(176,884	)		—		—		233,309
Total		$191,218		$66		($3,043	)		$240,522		($182,981	)		$—		$—		$245,782

All net realized and change in unrealized gains (losses) in the table above are reflected on the accompanying Statement of Operations. The change in appreciation (depreciation) for Level 3 investments held by the fund at April 30, 2014 was ($3,043).

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 and Level 2 for the period ended April 30, 2014. The transfers in the amount of $2,374,414 and $2,645,589 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. There were no transfers in and out of Level 3 during the period.

34 See financial notes

 Schwab Fundamental International Large Company Index Fund

Statement of

Assets and Liabilities

As of April 30, 2014; unaudited

Assets
Investments, at value (cost $669,699,048) including securities on loan of $23,139,166		$842,799,447
Foreign currency, at value (cost $87)		87
Collateral invested for securities on loan		25,081,669
Receivables:
Dividends		2,730,893
Fund shares sold		1,812,406
Foreign tax reclaims		487,208
Income from securities on loan		142,847
Variation margin on futures contracts		39,100
Interest		9
Prepaid expenses	+	5,123
Total assets		873,098,789
Liabilities
Collateral held for securities on loan		25,081,669
Payables:
Investment adviser and administrator fees		12,819
Shareholder service fees		6,147
Fund shares redeemed		758,165
Accrued expenses	+	187,637
Total liabilities		26,046,437
Net Assets
Total assets		873,098,789
Total liabilities	−	26,046,437
Net assets		$847,052,352
Net Assets by Source
Capital received from investors		788,626,845
Net investment income not yet distributed		11,627,371
Net realized capital losses		(126,748,934	)
Net unrealized capital appreciation		173,547,070
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$847,052,352		89,950,304			$9.42

See financial notes 35

 Schwab Fundamental International Large Company Index Fund

Statement of

Operations

For the period November 1, 2013 through April 30, 2014; unaudited

Investment Income
Dividends (net of foreign withholding taxes of $1,190,952)		$16,108,759
Interest		4,081
Securities on loan	+	323,541
Total investment income		16,436,381
Expenses
Investment adviser and administrator fees		995,747
Shareholder service fees		291,057
Index fee		209,951
Custodian fees		83,682
Portfolio accounting fees		42,119
Transfer agent fees		40,717
Professional fees		25,938
Registration fees		15,433
Shareholder reports		15,173
Independent trustees’ fees		4,610
Other expenses	+	13,431
Total expenses		1,737,858
Expense reduction by CSIM and its affiliates	−	469,282
Net expenses	−	1,268,576
Net investment income		15,167,805
Realized and Unrealized Gains (Losses)
Net realized gains on investments		9,616,588
Net realized gains on futures contracts		417,484
Net realized gains on foreign currency transactions	+	14,716
Net realized gains		10,048,788
Net change in unrealized appreciation (depreciation) on investments		26,198,880
Net change in unrealized appreciation (depreciation) on futures contracts		144,863
Net change in unrealized appreciation (depreciation) on foreign currency translations	+	6,492
Net change in unrealized appreciation (depreciation)	+	26,350,235
Net realized and unrealized gains		36,399,023
Increase in net assets resulting from operations		$51,566,828

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

11/1/13-4/30/14				11/1/12-10/31/13
Net investment income		$15,167,805			$17,039,641
Net realized gains (losses)		10,048,788			(9,812,563	)
Net change in unrealized appreciation (depreciation)	+	26,350,235			144,914,210
Increase in net assets from operations		51,566,828			152,141,288
Distributions to Shareholders
Distributions from net investment income		($17,955,621	)		($15,274,655	)

Transactions in Fund Shares

		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		VALUE			SHARES		VALUE
Shares sold			23,706,740		$214,217,502			24,782,287		$195,910,846
Shares reinvested			1,447,761		12,841,641			1,575,182		11,404,319
Shares redeemed	+		(6,576,269	)	(59,412,755	)		(24,923,187	)	(198,967,968	)
Net transactions in fund shares			18,578,232		$167,646,388			1,434,282		$8,347,197
Shares Outstanding and Net Assets
		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			71,372,072		$645,794,757			69,937,790		$500,580,927
Total increase	+		18,578,232		201,257,595			1,434,282		145,213,830
End of period			89,950,304		$847,052,352			71,372,072		$645,794,757
Net investment income not yet distributed					$11,627,371					$14,415,187

See financial notes 37

Schwab Fundamental International Small Company Index Fund

Financial Statements

Financial Highlights

	11/1/13–			11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–
	4/30/14*			10/31/13			10/31/12			10/31/11			10/31/10			10/31/091
Per-Share Data ($)
Net asset value at beginning of period		11.47			9.13			9.53			9.96			9.00			6.22
Income (loss) from investment operations:
Net investment income (loss)		0.11	2		0.22	2		0.21	2		0.24	2		0.16	2		0.12	2
Net realized and unrealized gains (losses)		0.40			2.42			0.03			(0.40	)		1.09			2.92
Total from investment operations		0.51			2.64			0.24			(0.16	)		1.25			3.04
Less distributions:
Distributions from net investment income		(0.31	)		(0.30	)		(0.25	)		(0.27	)		(0.29	)		(0.26	)
Distributions from net realized gains		—			—			(0.39	)		—			—			—
Total distributions		(0.31	)		(0.30	)		(0.64	)		(0.27	)		(0.29	)		(0.26	)
Net asset value at end of period		11.67			11.47			9.13			9.53			9.96			9.00
Total return (%)		4.59	3		29.75			3.13			(1.76	)		14.32			51.19
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		0.49	4		0.47	5,6		0.46	7,8		0.54			0.55			0.55
Gross operating expenses		0.82	4		0.93			0.92	8		0.99			1.07			3.82
Net investment income (loss)		2.02	4		2.21			2.42		��	2.29			1.77			1.59
Portfolio turnover rate		18	3		29			89	9		63			63			81
Net assets, end of period ($ x 1,000,000)		188			150			90			93			74			47

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

³ Not annualized.

⁴ Annualized.

⁵ Effective June 11, 2013, the net operating expense limitation was lowered. The ratio presented for period ended 10/31/13 is a blended ratio.

⁶ The ratio of net operating expenses would have been 0.52%, if voluntary waiver by CSIM had not been included.

⁷ The ratio of net operating expenses would have been 0.51%, if voluntary waiver by CSIM had not been included.

⁸ The net operating and gross operating expense ratios would have been 0.50% and 0.97%, respectively, if vendor payments had not been included.

⁹ Portfolio turnover would have been 0.48%, 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, 2014 (Unaudited)

This section shows the fund’s 50 largest portfolio holdings in unaffiliated issuers, and any holdings exceeding 1% of the fund’s 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		150,662,376		182,654,382
	0	.5%	Preferred Stock		597,623		947,632
	0	.0%	Rights		27,110		53,682
	1	.8%	Other Investment Company		3,251,972		3,381,300
	0	.7%	Short-Term Investments		1,236,416		1,236,416
	100	.0%	Total Investments		155,775,497		188,273,412
	2	.6%	Collateral Invested for Securities on Loan		4,909,704		4,909,704
	(2	.6)%	Other Assets and Liabilities, Net				(4,969,219	)
	100	.0%	Net Assets				188,213,897

	Number		% of Net		Value
Security	of Shares		Assets		($)
Common Stock 97.0% of net assets
Australia 5.4%
Aurizon Holdings Ltd.		68,185		0.2		329,212
Computershare Ltd.		28,004		0.1		322,794
David Jones Ltd.		103,629		0.2		379,629
Dexus Property Group		319,112		0.2		337,597
Other Securities				4.7		8,796,185
				5.4		10,165,417
Austria 0.7%
Other Securities				0.7		1,280,692
Belgium 1.3%
Mobistar S.A.		15,868		0.2		309,662
Other Securities				1.1		2,068,184
				1.3		2,377,846
Canada 8.7%
Atco Ltd., Class I		6,657		0.2		325,000
Methanex Corp.		5,593		0.2		346,434
Pembina Pipeline Corp.		8,755		0.2		344,033
Precision Drilling Corp.		28,849		0.2		375,073
Sherritt International Corp.		80,032		0.2		338,806
Vermilion Energy, Inc.		4,851		0.1		322,780
Other Securities				7.6		14,411,884
				8.7		16,464,010
Denmark 1.4%
Other Securities				1.4		2,753,355
Finland 1.8%
Rautaruukki Oyj *		35,341		0.2		440,283
Other Securities				1.6		3,002,702
				1.8		3,442,985
France 4.9%
Eramet		2,461		0.1		321,010
Faurecia *		7,952		0.2		357,940
ICADE (a)		3,255		0.2		332,102
Neopost S.A.		4,020		0.2		330,094
Teleperformance		5,738		0.2		329,088
Other Securities				4.0		7,486,257
				4.9		9,156,491
Germany 3.3%
Rhoen-Klinikum AG		10,054		0.2		324,510
Symrise AG		6,140		0.2		310,172
Other Securities				2.9		5,538,680
				3.3		6,173,362
Greece 0.0%
Other Securities				0.0		—
Hong Kong 2.8%
Hongkong Land Holdings Ltd.		44,000		0.2		308,375
Other Securities				2.6		4,897,481
				2.8		5,205,856
Ireland 0.7%
Other Securities				0.7		1,297,256
Israel 1.2%
Other Securities				1.2		2,347,469
Italy 2.9%
Luxottica Group S.p.A.		5,595		0.2		320,910
Other Securities				2.7		5,077,983
				2.9		5,398,893
Japan 35.0%
Alps Electric Co., Ltd.		29,600		0.2		334,701
Chugai Pharmaceutical Co., Ltd.		13,800		0.2		348,296
COMSYS Holdings Corp.		19,200		0.2		314,766
Kamigumi Co., Ltd.		35,000		0.2		333,631
Minebea Co., Ltd.		40,000		0.2		324,159
NGK Insulators Ltd.		18,000		0.2		340,397
Nissin Foods Holdings Co., Ltd.		7,100		0.2		339,854
Nitori Holdings Co., Ltd.		6,800		0.1		311,907

See financial notes 39

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		% of Net		Value
Security	of Shares		Assets		($)
Other Securities				33.5		63,174,760
				35.0		65,822,471
Luxembourg 0.6%
Other Securities				0.6		1,114,766
Netherlands 2.1%
Koninklijke Boskalis Westminster N.V.		6,483		0.2		367,435
USG People N.V.		23,817		0.2		412,069
Other Securities				1.7		3,182,043
				2.1		3,961,547
New Zealand 0.6%
Other Securities				0.6		1,138,662
Norway 1.2%
REC Silicon A.S.A. *		561,522		0.1		314,084
Other Securities				1.1		2,011,948
				1.2		2,326,032
Portugal 0.4%
Other Securities				0.4		708,855
Republic of Korea 0.0%
Other Securities				0.0		—
Singapore 1.8%
Other Securities				1.8		3,320,624
Spain 2.1%
Abengoa S.A., B Shares		81,769		0.2		364,056
Acerinox S.A. (a)		19,613		0.2		342,966
Gamesa Corp. Tecnologica S.A. *		38,595		0.2		383,627
Mapfre S.A.		75,114		0.1		316,793
Other Securities				1.4		2,632,234
				2.1		4,039,676
Sweden 2.3%
Ratos AB, B Shares		30,650		0.1		312,678
Other Securities				2.2		4,081,256
				2.3		4,393,934
Switzerland 3.1%
Actelion Ltd. - Reg’d *		3,343		0.2		329,130
Georg Fischer AG - Reg’d *		447		0.2		354,607
Other Securities				2.7		5,135,194
				3.1		5,818,931
United Kingdom 12.7%
Ashtead Group plc		21,325		0.2		315,955
Berendsen plc		17,683		0.1		309,027
Catlin Group Ltd.		34,870		0.1		311,432
DS Smith plc		59,130		0.2		315,107
Hammerson plc		33,820		0.2		326,400
Investec plc		36,798		0.2		324,697
London Stock Exchange Group plc		11,060		0.2		338,950
Provident Financial plc		9,281		0.2		312,047
Other Securities				11.3		21,391,637
				12.7		23,945,252
Total Common Stock
(Cost $150,662,376)						182,654,382
Preferred Stock 0.5% of net assets
Germany 0.4%
Porsche Automobil Holding SE		2,929		0.2		323,933
Other Securities				0.2		348,367
				0.4		672,300
Italy 0.1%
Other Securities				0.1		275,332
Total Preferred Stock
(Cost $597,623)						947,632
Rights 0.0% of net assets
Australia 0.0%
Other Securities				0.0		53,682
Total Rights
(Cost $27,110)						53,682
Other Investment Company 1.8% of net assets
United States 1.8%
iShares MSCI EAFE Small Cap ETF		65,000		1.8		3,381,300
Total Other Investment Company
(Cost $3,251,972)						3,381,300
	Face
Security	Amount		% of Net		Value
Rate, Maturity Date	($)		Assets		($)
Short-Term Investments 0.7% of net assets
Time Deposits 0.5%
Bank of Tokyo Mitsubishi		807,514		0.4		807,514
Other Securities				0.1		128,922
				0.5		936,436
U.S. Treasury Obligation 0.2%
Other Securities				0.2		299,980
Total Short-Term Investments
(Cost $1,236,416)						1,236,416
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 2.6% of net assets
Wells Fargo Advantage Government Money Market Fund, Institutional Class 0.01% (f)		4,909,704		2.6		4,909,704
Total Collateral Invested for Securities on Loan
(Cost $4,909,704)						4,909,704
End of Collateral Invested for Securities on Loan.

At 04/30/14, the tax basis cost of the fund’s investments was $156,506,437 and the unrealized appreciation and depreciation were $36,954,228 and ($5,187,253), respectively, with a net unrealized appreciation of $31,766,975.

At 04/30/14, the values of certain foreign securities held by the fund aggregating $156,443,487 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(a) for additional information)

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

*	Non-income producing security.
(a)	All or a portion of this security is on loan. Securities on loan were valued at $4,646,231.
(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 $2,426 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.
(f)	The rate shown is the 7-day yield.

ADR —	American Depositary Receipt
CDI —	CHESS Depositary Interest
ETF —	Exchange traded fund
GDR —	Global Depositary Receipt
Reg’d —	Registered
REIT —	Real Estate Investment Trust
SDR —	Swedish Depositary Receipt

In addition to the above the fund held the following at 04/30/14:

			Contract		Unrealized
	Number of		Value		Appreciation
	Contracts		($)		($)
Futures Contracts
MSCI EAFE, e-mini, Long, expires 06/20/14		1		96,215		4,425

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, 2014 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Other Significant		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Common Stock1		$—		$4,029,479		$—		$4,029,479
Australia		348,169		9,565,060		252,188		10,165,417
Austria		352,866		927,826		—		1,280,692
Belgium		567,460		1,810,386		—		2,377,846
Canada		16,464,010		—		—		16,464,010
Denmark		137,529		2,615,826		—		2,753,355
Finland		401,120		3,041,865		—		3,442,985
France		805,013		8,351,478		—		9,156,491
Germany		450,832		5,722,530		—		6,173,362
Greece		—		—		—		—
Hong Kong		516,969		4,688,887		—		5,205,856
Ireland		674,735		622,521		—		1,297,256
Israel		286,156		2,061,313		—		2,347,469
Italy		531,307		4,867,586		—		5,398,893
Japan		199,185		65,623,286		—		65,822,471
Luxembourg		273,330		841,436		—		1,114,766
Netherlands		704,025		3,257,522		—		3,961,547
New Zealand		58,361		1,080,301		—		1,138,662
Norway		556,148		1,769,884		—		2,326,032
Republic of Korea		—		—		—		—
Spain		135,352		3,904,324		—		4,039,676
Sweden		227,167		4,166,767		—		4,393,934
Switzerland		359,994		5,458,937		—		5,818,931
United Kingdom		2,856,611		21,088,641		—		23,945,252
Preferred Stock1		—		947,632		—		947,632
Rights
Australia		51,256		—		2,426		53,682
Other Investment Company1		3,381,300		—		—		3,381,300
Short-Term Investments1		—		1,236,416		—		1,236,416
Total		$30,338,895		$157,679,903		$254,614		$188,273,412
Other Financial Instruments
Collateral Invested for Securities on Loan		$4,909,704		$—		$—		$4,909,704
Futures Contracts2		4,425		—		—		4,425

1	As categorized in the complete schedule of portfolio holdings.
2	Futures contracts are not included in Investments in the schedule of portfolio holdings 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		Appreciation		Gross		Gross			Transfers		Transfers		April 30,
Investments in Securities	2013		(Losses)		(Depreciation)		Purchases		Sales			in		out		2014
Common Stock
Australia		$—		$—		$3,436		$60,442		$—			$188,310		$—		$252,188
Sweden		—		—		12,129		—		(12,129	)		—		—		—
Rights
Australia		—		—		2,426		—		—			—		—		2,426
Total		$—		$—		$17,991		$60,442		($12,129	)		$188,310		$—		$254,614

All net realized and change in unrealized gains (losses) in the table above are reflected on the accompanying Statement of Operations. The change in appreciation (depreciation) for Level 3 investments held by the fund at April 30, 2014 was $4,123.

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, 2014. The transfers in the amount of $5,084,129 and $3,549,511 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, 2014; unaudited

Assets
Investments, at value (cost $155,775,497) including securities on loan of $4,646,231		$188,273,412
Foreign currency, at value (cost $34)		35
Collateral invested for securities on loan		4,909,704
Receivables:
Investments sold		2,969,174
Dividends		785,679
Fund shares sold		328,175
Foreign tax reclaims		35,255
Income from securities on loan		22,066
Variation margin on futures contracts		340
Prepaid expenses	+	913
Total assets		197,324,753
Liabilities
Collateral held for securities on loan		4,909,704
Payables:
Investments bought		4,052,332
Investment adviser and administrator fees		2,357
Fund shares redeemed		28,729
Accrued expenses	+	117,734
Total liabilities		9,110,856
Net Assets
Total assets		197,324,753
Total liabilities	−	9,110,856
Net assets		$188,213,897
Net Assets by Source
Capital received from investors		158,822,677
Distributions in excess of net investment income		(625,486	)
Net realized capital losses		(2,484,182	)
Net unrealized capital appreciation		32,500,888
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$188,213,897		16,128,895			$11.67

44 See financial notes

 Schwab Fundamental International Small Company Index Fund

Statement of

Operations

For the period November 1, 2013 through April 30, 2014; unaudited

Investment Income
Dividends (net of foreign withholding taxes of $250,452)		$1,914,055
Interest		346
Securities on loan	+	80,001
Total investment income		1,994,402
Expenses
Investment adviser and administrator fees		318,284
Shareholder service fees		57,634
Custodian fees		90,376
Index fee		65,006
Portfolio accounting fees		28,220
Professional fees		24,049
Transfer agent fees		19,753
Shareholder reports		16,179
Registration fees		13,899
Independent trustees’ fees		3,339
Interest expense		236
Other expenses	+	13,059
Total expenses		650,034
Expense reduction by CSIM and its affiliates	−	259,901
Net expenses	−	390,133
Net investment income		1,604,269
Realized and Unrealized Gains (Losses)
Net realized gains on investments		1,944,025
Net realized gains on futures contracts		59,865
Net realized losses on foreign currency transactions	+	(5,398	)
Net realized gains		1,998,492
Net change in unrealized appreciation (depreciation) on investments		3,910,603
Net change in unrealized appreciation (depreciation) on futures contracts		(17	)
Net change in unrealized appreciation (depreciation) on foreign currency translations	+	(4,180	)
Net change in unrealized appreciation (depreciation)	+	3,906,406
Net realized and unrealized gains		5,904,898
Increase in net assets resulting from operations		$7,509,167

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

11/1/13-4/30/14				11/1/12-10/31/13
Net investment income		$1,604,269			$2,524,591
Net realized gains		1,998,492			1,480,423
Net change in unrealized appreciation (depreciation)	+	3,906,406			25,933,638
Increase in net assets from operations		7,509,167			29,938,652
Distributions to Shareholders
Distributions from net investment income		($4,201,706	)		($3,109,770	)

Transactions in Fund Shares

		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		VALUE			SHARES		VALUE
Shares sold			4,252,041		$48,619,714			5,053,700		$51,573,590
Shares reinvested			238,640		2,675,147			227,023		2,068,185
Shares redeemed	+		(1,400,247	)	(15,963,623	)		(2,140,208	)	(21,234,821	)
Net transactions in fund shares			3,090,434		$35,331,238			3,140,515		$32,406,954
Shares Outstanding and Net Assets
		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			13,038,461		$149,575,198			9,897,946		$90,339,362
Total increase	+		3,090,434		38,638,699			3,140,515		59,235,836
End of period			16,128,895		$188,213,897			13,038,461		$149,575,198
Distributions in excess of net investment income/Net investment income not yet distributed					($625,486	)				$1,971,951

46 See financial notes

Schwab Fundamental Emerging Markets Large Company Index Fund

Financial Statements

Financial Highlights

	11/1/13–			11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–
	4/30/14*			10/31/13			10/31/12			10/31/11			10/31/10			10/31/091
Per-Share Data ($)
Net asset value at beginning of period		9.24			8.86			9.17			10.81			8.91			5.74
Income (loss) from investment operations:
Net investment income (loss)		0.05			0.19			0.25			0.24			0.17			0.05
Net realized and unrealized gains (losses)		(0.47	)		0.43			(0.17	)		(1.37	)		1.81			3.27
Total from investment operations		(0.42	)		0.62			0.08			(1.13	)		1.98			3.32
Less distributions:
Distributions from net investment income		(0.18	)		(0.24	)		(0.22	)		(0.15	)		(0.08	)		(0.15	)
Distributions from net realized gains		—			—			(0.17	)		(0.36	)		—			—
Total distributions		(0.18	)		(0.24	)		(0.39	)		(0.51	)		(0.08	)		(0.15	)
Net asset value at end of period		8.64			9.24			8.86			9.17			10.81			8.91
Total return (%)		(4.58	)2		7.11			1.18			(10.99	)		22.36			59.55
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		0.49	3		0.51	4,5		0.56	6		0.61	7		0.61	7		0.61	7
Gross operating expenses		0.84	3		0.88			0.91			0.91			0.98			1.70
Net investment income (loss)		1.34	3		2.22			2.75			2.51			2.31			1.56
Portfolio turnover rate		8	2		22			86	8		56			91			103
Net assets, end of period ($ x 1,000,000)		345			353			314			310			294			119

* 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 Not annualized.

³ Annualized.

⁴ Effective June 11, 2013, the net operating expense limitation was lowered. The ratio presented for period ended 10/31/13 is a blended ratio.

⁵ The ratio of net operating expenses would have been 0.56%, if voluntary waiver by CSIM had not been included.

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 0.51%, 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, 2014 (Unaudited)

This section shows the fund’s 50 largest portfolio holdings in unaffiliated issuers, and any holdings exceeding 1% of the fund’s 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				($)		($)
	88	.9%	Common Stock		306,310,774		307,333,784
	10	.1%	Preferred Stock		43,133,333		34,812,965
	0	.0%	Rights		—		16
	0	.0%	Other Investment Company		3,762		4,133
	0	.7%	Short-Term Investments		2,427,242		2,427,242
	99	.7%	Total Investments		351,875,111		344,578,140
	0	.3%	Other Assets and Liabilities, Net				881,078
	100	.0%	Net Assets				345,459,218

	Number		% of Net		Value
Security	of Shares		Assets		($)
Common Stock 88.9% of net assets
Brazil 5.8%
Petroleo Brasileiro S.A. - Petrobras		715,900		1.4		5,018,283
Vale S.A.		274,500		1.0		3,619,374
Other Securities				3.4		11,606,220
				5.8		20,243,877
Chile 0.8%
Other Securities				0.8		2,848,746
China 12.6%
Bank of China Ltd., Class H		8,733,234		1.1		3,847,847
China Construction Bank Corp., Class H		8,475,000		1.7		5,867,861
China Mobile Ltd.		619,600		1.7		5,897,646
China Petroleum & Chemical Corp., Class H		5,588,400		1.4		4,961,136
CNOOC Ltd.		1,633,000		0.8		2,699,101
Industrial & Commercial Bank of China Ltd., Class H		6,886,172		1.2		4,114,609
PetroChina Co., Ltd., Class H		3,227,000		1.1		3,723,231
Other Securities				3.6		12,423,123
				12.6		43,534,554
Colombia 0.3%
Other Securities				0.3		932,727
Czech Republic 0.5%
Other Securities				0.5		1,630,794
Egypt 0.2%
Other Securities				0.2		790,410
Greece 1.6%
Other Securities				1.6		5,640,377
Hungary 0.6%
Other Securities				0.6		2,008,735
India 3.8%
Reliance Industries Ltd.		212,500		1.0		3,303,125
Other Securities				2.8		9,710,919
				3.8		13,014,044
Indonesia 0.8%
Other Securities				0.8		2,712,510
Malaysia 1.6%
Other Securities				1.6		5,710,545
Mexico 3.5%
America Movil S.A.B. de C.V., Series L		3,276,800		1.0		3,296,149
Cemex S.A.B. de C.V., Series CPO *		1,752,965		0.6		2,241,662
Other Securities				1.9		6,522,661
				3.5		12,060,472
Philippines 0.2%
Other Securities				0.2		620,561
Poland 2.3%
Polski Koncern Naftowy Orlen S.A.		116,600		0.5		1,745,955
Other Securities				1.8		6,337,494
				2.3		8,083,449
Republic of Korea 18.9%
Hyundai Mobis		5,800		0.5		1,656,964
Hyundai Motor Co.		17,500		1.1		3,901,913
Korea Electric Power Corp.		56,600		0.6		2,164,088
LG Corp.		52,100		0.8		2,905,182
LG Display Co., Ltd. *		63,000		0.5		1,677,923
LG Electronics, Inc.		41,400		0.8		2,757,487
POSCO		15,500		1.3		4,579,138
Samsung Electronics Co., Ltd.		9,996		3.8		13,034,387
Shinhan Financial Group Co., Ltd.		45,800		0.6		1,999,096
SK C&C Co., Ltd.		12,300		0.5		1,688,385
SK Holdings Co., Ltd.		12,600		0.6		2,234,990
SK Innovation Co., Ltd.		16,556		0.6		1,896,645
Other Securities				7.2		24,928,972
				18.9		65,425,170

48 See financial notes

 Schwab Fundamental Emerging Markets Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		% of Net		Value
Security	of Shares		Assets		($)
Russia 12.7%
Gazprom ADR		1,575,900		3.3		11,388,928
LUKOIL ADR		223,800		3.4		11,847,843
Mining & Metallurgical Co. Norilsk Nickel OJSC ADR		145,700		0.8		2,634,135
Sberbank of Russia ADR		226,003		0.5		1,903,865
Surgutneftegas ADR		687,500		1.4		4,875,239
Tatneft ADR		47,100		0.5		1,620,076
Other Securities				2.8		9,599,467
				12.7		43,869,553
South Africa 7.7%
MTN Group Ltd.		198,475		1.2		3,981,767
Sasol Ltd.		84,500		1.4		4,735,744
Standard Bank Group Ltd.		138,100		0.5		1,814,489
Other Securities				4.6		15,982,542
				7.7		26,514,542
Taiwan 12.5%
Asustek Computer, Inc.		204,041		0.6		2,109,586
AU Optronics Corp. *		4,429,800		0.5		1,684,061
Chunghwa Telecom Co., Ltd.		527,906		0.5		1,650,789
Formosa Chemicals & Fibre Corp.		750,442		0.5		1,817,250
Formosa Plastics Corp.		642,732		0.5		1,658,494
Hon Hai Precision Industry Co., Ltd.		1,680,800		1.4		4,827,192
HTC Corp.		315,473		0.5		1,622,366
Taiwan Semiconductor Manufacturing Co., Ltd.		1,492,689		1.7		5,865,305
Other Securities				6.3		21,992,794
				12.5		43,227,837
Thailand 1.1%
PTT PCL		176,987		0.5		1,706,426
Other Securities				0.6		2,015,617
				1.1		3,722,043
Turkey 1.4%
Other Securities				1.4		4,742,838
Total Common Stock
(Cost $306,310,774)						307,333,784
Preferred Stock 10.1% of net assets
Brazil 8.2%
Banco Bradesco S.A.		173,000		0.7		2,575,118
Itau Unibanco Holding S.A.		296,200		1.4		4,888,512
Petroleo Brasileiro S.A.		1,066,900		2.3		7,928,482
Vale S.A.		378,600		1.3		4,485,979
Other Securities				2.5		8,548,690
				8.2		28,426,781
Colombia 0.1%
Other Securities				0.1		346,771
Republic of Korea 0.8%
Samsung Electronics Co., Ltd.		1,620		0.5		1,629,038
Other Securities				0.3		1,154,488
				0.8		2,783,526
Russia 1.0%
AK Transneft OAO *		1,471		1.0		3,255,887
Total Preferred Stock
(Cost $43,133,333)						34,812,965
Rights 0.0% of net assets
Brazil 0.0%
Other Securities				0.0		16
Total Rights
(Cost $—)						16
Other Investment Company 0.0% of net assets
United States 0.0%
Other Securities				0.0		4,133
Total Other Investment Company
(Cost $3,762)						4,133
	Face
Security	Amount		% of Net		Value
Rate, Maturity Date	($)		Assets		($)
Short-Term Investments 0.7% of net assets
Time Deposit 0.6%
DNB
0.03%, 05/01/14		2,242,251		0.6		2,242,251
U.S. Treasury Obligation 0.1%
Other Securities				0.1		184,991
Total Short-Term Investments
(Cost $2,427,242)						2,427,242
End of Investments.

At 04/30/14, the tax basis cost of the fund’s investments was $357,462,537 and the unrealized appreciation and depreciation were $34,629,856 and ($47,514,253), respectively, with a net unrealized depreciation of ($12,884,397).

See financial notes 49

 Schwab Fundamental Emerging Markets Large Company Index Fund

Portfolio Holdings (Unaudited) continued

At 04/30/14, the values of certain foreign securities held by the fund aggregating $260,440,952 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(a) for additional information)

For the following notes, please refer to the complete schedule of portfolio 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 $738,500 or 0.2% of net assets.
(c)	All or a portion of this security is held as collateral for open futures contracts.
(d)	The rate shown is the purchase yield.

ADR —	American Depositary Receipt
ETF —	Exchange traded fund
GDR —	Global Depositary Receipt
Reg’d —	Registered

In additional to the above the fund held the following at 04/30/14:

			Contract		Unrealized
	Number of		Value		Appreciation
	Contracts		($)		($)
Futures Contracts
MSCI Emerging Markets, mini, Long, expires 06/20/14		55		2,734,875		17,673

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2014 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Other Significant		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Common Stock1		$—		$148,516,953		$—		$148,516,953
Brazil		20,243,877		—		—		20,243,877
Chile		2,848,746		—		—		2,848,746
Colombia		932,727		—		—		932,727
Czech Republic		508,263		1,122,531		—		1,630,794
Mexico		12,060,472		—		—		12,060,472
Poland		1,133,843		6,949,606		—		8,083,449
Republic of Korea		969,593		63,717,093		738,484		65,425,170
Russia		6,518,310		37,351,243		—		43,869,553
Thailand		3,722,043		—		—		3,722,043
Preferred Stock1		—		2,783,526		—		2,783,526
Brazil		28,426,781		—		—		28,426,781
Colombia		346,771		—		—		346,771
Russia		3,255,887		—		—		3,255,887
Rights1		16		—		—		16
Other Investment Company1		4,133		—		—		4,133
Short-Term Investments1		—		2,427,242		—		2,427,242
Total		$80,971,462		$262,868,194		$738,484		$344,578,140
Other Financial Instruments
Futures Contracts2		$17,673		$—		$—		$17,673

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

50 See financial notes

 Schwab Fundamental Emerging Markets Large 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			Appreciation			Gross		Gross			Transfers		Transfers		April 30,
Investments in Securities	2013		(Losses)			(Depreciation)			Purchases		Sales			in		out		2014
Common Stock
Republic of Korea		$—		($1,190	)		($37,520	)		$24,877		($24,152	)		$776,469		$—		$738,484
Total		$—		($1,190	)		($37,520	)		$24,877		($24,152	)		$776,469		$—		$738,484

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 appreciation (depreciation) for Level 3 investments held by the fund at April 30, 2014 was ($37,520).

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, 2014. The transfers in the amount of $1,967,730 and $40,771,056 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 51

 Schwab Fundamental Emerging Markets Large Company Index Fund

Statement of

Assets and Liabilities

As of April 30, 2014; unaudited

Assets
Investments, at value (cost $351,875,111)		$344,578,140
Foreign currency, at value (cost $527,744)		527,239
Receivables:
Investments sold		402,705
Fund shares sold		336,068
Dividends		223,252
Interest		2
Foreign tax reclaims		1
Prepaid expenses	+	2,753
Total assets		346,070,160
Liabilities
Payables:
Investment adviser and administrator fees		3,030
Shareholder service fees		3,438
Fund shares redeemed		381,437
Foreign capital gains tax		69,772
Variation margin on futures contracts		7,425
Accrued expenses and other liabilities	+	145,840
Total liabilities		610,942
Net Assets
Total assets		346,070,160
Total liabilities	−	610,942
Net assets		$345,459,218
Net Assets by Source
Capital received from investors		368,465,248
Net investment income not yet distributed		988,618
Net realized capital losses		(16,644,269	)
Net unrealized capital depreciation		(7,350,379	)
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$345,459,218		39,970,094			$8.64

52 See financial notes

 Schwab Fundamental Emerging Markets Large Company Index Fund

Statement of

Operations

For the period November 1, 2013 through April 30, 2014; unaudited

Investment Income
Dividends (net of foreign withholding taxes of $513,883)		$3,168,940
Interest		1,073
Securities on loan	+	1,987
Total investment income		3,172,000
Expenses
Investment adviser and administrator fees		867,916
Shareholder service fees		129,401
Index fee		160,089
Custodian fees		160,041
Portfolio accounting fees		36,146
Professional fees		29,554
Transfer agent fees		29,218
Shareholder reports		18,784
Registration fees		18,673
Independent trustees’ fees		3,861
Interest expense		943
Other expenses	+	6,597
Total expenses		1,461,223
Expense reduction by CSIM and its affiliates	−	609,722
Net expenses	−	851,501
Net investment income		2,320,499
Realized and Unrealized Gains (Losses)
Net realized losses on investments		(1,017,762	)
Net realized losses on futures contracts		(767,364	)
Net realized gains on foreign currency transactions	+	451
Net realized losses		(1,784,675	)
Net change in unrealized appreciation (depreciation) on investments (net of foreign capital gain tax of ($21,894))		(17,336,124	)
Net change in unrealized appreciation (depreciation) on futures contracts		(123,903	)
Net change in unrealized appreciation (depreciation) on foreign currency translations	+	661
Net change in unrealized appreciation (depreciation)	+	(17,459,366	)
Net realized and unrealized losses		(19,244,041	)
Decrease in net assets resulting from operations		($16,923,542	)

See financial notes 53

 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

11/1/13-4/30/14				11/1/12-10/31/13
Net investment income		$2,320,499			$7,185,968
Net realized gains (losses)		(1,784,675	)		69,488
Net change in unrealized appreciation (depreciation)	+	(17,459,366	)		14,710,964
Increase (Decrease) in net assets from operations		(16,923,542	)		21,966,420
Distributions to Shareholders
Distributions from net investment income		($7,207,709	)		($8,681,589	)

Transactions in Fund Shares

		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		VALUE			SHARES		VALUE
Shares sold			10,106,111		$86,731,737			14,934,368		$131,472,133
Shares reinvested			517,807		4,510,103			618,303		5,583,275
Shares redeemed	+		(8,877,190	)	(74,646,030	)		(12,809,415	)	(111,551,317	)
Net transactions in fund shares			1,746,728		$16,595,810			2,743,256		$25,504,091
Shares Outstanding and Net Assets
		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			38,223,366		$352,994,659			35,480,110		$314,205,737
Total increase or decrease	+		1,746,728		(7,535,441	)		2,743,256		38,788,922
End of period			39,970,094		$345,459,218			38,223,366		$352,994,659
Net investment income not yet distributed					$988,618					$5,875,828

54 See financial notes

 Schwab Fundamental Index Funds

Financial Notes, unaudited

1. Business Structure of the Funds:

Each of the funds 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 a 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 U.S. Securities and 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:

•  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

55

 Schwab Fundamental Index 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 NAV 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 contracts (“futures”) and forward foreign currency exchange contracts (“forwards”): Futures are valued at their settlement prices as of the close of their exchanges. Forwards are valued based on that day’s forward exchange rates or by using an interpolated forward exchange rate for contracts with interim settlement dates.

•  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 NAVs. Exchange traded 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, ETFs and futures contracts. Investments in mutual funds are valued daily at their NAVs, and investments in ETFs are valued daily at the last reported sale price or the official closing price, 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

56 

 Schwab Fundamental Index Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

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, 2014 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 a 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 appreciation or depreciation 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 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 appreciation or depreciation 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 be maintained on a daily marked-to-market basis in an amount at least equal to the current value of the securities loaned. The lending agent provides a fund with indemnification against borrower default (the borrower fails to return the security on loan) reducing the risk of loss as a result of default. The cash collateral of securities loaned is currently invested in money market portfolios operating under Rule 2a-7 of the 1940 Act. Each fund bears the risk of loss with respect to the investment of cash collateral. Securities lending income, as disclosed in each 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 and broker rebates which are subject to adjustments pursuant to the securities lending agreement. On loans not collateralized by cash, a fee is received from the borrower, and is allocated between a fund and the lending agent. A fund retains the right to recall a security on loan. The aggregate market value of securities loaned will not at any time exceed one-third of the total assets of a fund, including collateral received from the loan (at market value computed at the time of the loan). Total costs and expenses, including agent fees associated with securities lending activities under the trust’s Securities Lending Program paid to the unaffiliated lending agent are approximately 15% of the gross lending revenues.

The values of the securities on loan and the related cash collateral as of April 30, 2014 for the Schwab Fundamental US Large Company Index Fund, Schwab Fundamental US Small Company Index Fund, Schwab Fundamental International Large Company Index Fund, and Schwab Fundamental International Small Company Index Fund are disclosed in each fund’s complete Portfolio Holdings and Statement of Assets and Liabilities.

57

 Schwab Fundamental Index Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

The values of the securities on loan and the related cash collateral are disclosed in the Portfolio Holdings and the Statement of Assets and Liabilities for each fund. The following table presents the non-cash collateral as of April 30, 2014:

	Non-Cash
	Collateral Received
Schwab Fundamental US Large Company Index Fund		$2,233,796
Schwab Fundamental US Small Company Index Fund		2,576,138

(c) Security Transactions:

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

Assets and liabilities denominated in foreign currencies are reported in U.S. dollars. For assets and liabilities held on a given date, the dollar value is based on market exchange rates in effect on that date. Transactions involving foreign currencies, including purchases, sales, income receipts and expense payments, are 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 forward 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. Any distributions from underlying funds are recorded in accordance with the character of the distributions as designated by the underlying funds.

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.

58 

 Schwab Fundamental Index Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

(g) Custody Credit:

Certain 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 a fund’s 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, 2014, 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.

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.

Market Risk. 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.

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. 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.

Investment Style Risk. 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.

59

 Schwab Fundamental Index Funds

Financial Notes, unaudited (continued)

3. Risk Factors (continued):

A significant percentage of an index may be composed of securities in a single industry or sector of the economy. If a fund is focused in an industry or sector, it may present more risks than if it were broadly diversified over numerous industries and sectors of the economy.

Sampling Index Tracking Risk. 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 will be 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.

Concentration Risk. To the extent that a fund’s or an index’s portfolio is concentrated in the securities of issuers in a particular market, industry, group of industries, sector, country, 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, country, or asset class.

Large-Cap Risk. 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 performance also will lag those investments.

Small-Cap Risk. 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 performance also will lag those investments.

Foreign Investment Risk. 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); the imposition of economic sanctions or other government restrictions; differing accounting, auditing, financial reporting and legal standards and practices; differing securities market structures; and higher transaction costs. These risks may negatively impact the value or liquidity of a fund’s investments, and could impair the fund’s ability to meet its investment objective or invest in accordance with its investment strategies. These risks may be heightened in connection with investments in emerging markets. Foreign securities also include American Depositary Receipts (“ADRs”), Global Depositary Receipts (“GDRs”) and European Depositary Receipts (“EDRs”), which are depositary receipts issued by U.S. and foreign banks that represent shares of foreign-based corporations. ADRs, GDRs and EDRs may be less liquid than the underlying shares in their primary trading markets; and GDRs, many of which are issued by companies in emerging markets, may be more volatile. To the extent a fund’s investments in a single country or a limited number of countries represent a larger percentage of the fund’s assets, the fund’s performance may be adversely affected by the economic, political and social conditions in those countries and it may be subject to increased price volatility.

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 a fund’s investments in emerging market countries and, at times, it may be difficult to value such investments.

ETFs Risk. A fund may purchase shares of ETFs 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 proportionate share 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.

Derivatives Risk. 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

60 

 Schwab Fundamental Index Funds

Financial Notes, unaudited (continued)

3. Risk Factors (continued):

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 a fund to realize higher amounts of short-term capital gain. These risks could cause a fund to lose more than the principal amount invested.

Liquidity Risk. 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.

Security Lending Risk. 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		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

61

 Schwab Fundamental Index Funds

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		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%		0.49%		0.49%

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.

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

11/01/13

11/01/13

Fund

10/31/13

Purchases

Sales

04/30/14

04/30/14

to 04/30/14

to 04/30/14

Schwab Fundamental US Large Company Index Fund

138,015

10,300

(29,500

)

118,815

$3,154,538

$280,468

$15,632

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 CSIM 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.

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 on the funds’ 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 during the report period. The funds invested in futures to equitize available cash. The fair value and variation margin for futures contracts held at April 30, 2014 are presented on the Portfolio Holdings and Statement of Assets and Liabilities, 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

62 

 Schwab Fundamental Index Funds

Financial Notes, unaudited (continued)

7. Derivatives (continued):

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		$72,514,838		791
Schwab Fundamental US Small Company Index Fund		24,914,342		217
Schwab Fundamental International Large Company Index Fund		17,277,038		183
Schwab Fundamental International Small Company Index Fund		125,865		1
Schwab Fundamental Emerging Markets Large Company Index Fund		5,091,583		103

8. Purchases and Sales/Maturities of Investment Securities:

For the period ended April 30, 2014, 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		$515,405,130		$325,841,847
Schwab Fundamental US Small Company Index Fund		293,398,664		71,461,113
Schwab Fundamental International Large Company Index Fund		186,225,443		25,262,256
Schwab Fundamental International Small Company Index Fund		61,598,940		28,968,452
Schwab Fundamental Emerging Markets Large Company Index Fund		38,874,660		25,940,679

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
	(11/1/13-4/30/14)		(11/1/12-10/31/13)
Schwab Fundamental US Large Company Index Fund		$39,620		$30,032
Schwab Fundamental US Small Company Index Fund		4,766		7,961
Schwab Fundamental International Large Company Index Fund		6,228		6,437
Schwab Fundamental International Small Company Index Fund		1,854		3,107
Schwab Fundamental Emerging Markets Large Company Index Fund		4,168		4,863

63

 Schwab Fundamental 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, 2013, 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		$—		$—		$6,761,375			$—		$—
October 31, 2017		12,619,654		—		58,777,944			—		—
October 31, 2018		—		—		20,948,477			—		—
No expiration*		—		—		31,890,310			3,782,968		10,246,643
Total		$12,619,654		$—		$118,378,106	**		$3,782,968		$10,246,643	**

*

As a result of the passage of the Regulated Investment Company Modernization Act of 2010 (“RIC”), 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, 2013, the Schwab Fundamental International Large Company Index Fund and the Schwab Fundamental Emerging Markets Large Company Index Fund utilized post-RIC Modernization short-term capital losses of $1,295,562 and $827,213 respectively.

For the year ended October 31, 2013, 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		$51,247,926		$—		$—		$1,027,038		$605,972

As of October 31, 2013, 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, 2013, the funds did not incur any interest or penalties.

11. Other:

As a result of recent political and military actions undertaken by the Russian Federation, the U.S. and the European Union have instituted various economic sanctions against Russian individuals and entities. The U.S. and/or the European Union may impose additional economic sanctions, or take other actions, against individuals and/or companies in specific sectors of the Russian economy, including, but not limited to, the financial services, energy, metals and mining, engineering, and defense and defense- related materials sectors. These sanctions, and the threat of additional sanctions, could have adverse consequences for the Russian economy, including continued weakening of the Russian currency, downgrades in Russia’s credit rating, and a significant decline in the value and liquidity of securities issued by Russian companies or the Russian government. Any of these events could negatively impact the investments of the Schwab Fundamental Emerging Markets Large Company Index Fund in Russian securities.

12. 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 97 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).	76	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).	76	Director, Gilead Sciences, Inc. (2005 – present) Director, Monaco Coach Corporation (2005 – 2009)
David L. Mahoney 1954 Trustee (Trustee of Schwab Capital Trust since 2011.)	Private Investor.	76	Director, Symantec Corporation (2003 – present) Director, Corcept Therapeutics Incorporated (2004 – present)
Kiran M. Patel 1948 Trustee (Trustee of Schwab Capital Trust since 2011.)	Retired. Executive Vice President and General Manager of Small Business Group, Intuit, Inc. (financial software and services for consumers and small businesses) (Dec. 2008 – Sept. 2013).	76	Director, KLA-Tencor Corporation (2008 – present)
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).	76	Director, Eaton (2012 – present) Director and Chairman of the Audit Committee, Oneok Partners LP (2003 – 2013) Director, Oneok, Inc. (2009 – 2013) Lead Independent Director, Board of Cooper Industries (2002 – 2012)
Joseph H. Wender 1944 Trustee (Trustee of Schwab Capital Trust since 2008.)	Senior Consultant, Goldman Sachs & Co., Inc. (investment banking and securities firm) (Jan. 2008 – present); Partner, Colgin Partners, LLC (vineyards) (February 1998 – present).	76	Board Member and Chairman of the Audit Committee, Isis Pharmaceuticals (1994 – present)

65

 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.	76	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.	97	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, Chief Executive Officer (Dec. 2010 – present), and Chief Investment Officer (Sept. 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 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 (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).

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
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).
David Lekich 1964 Chief Legal Officer and Secretary (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 and Assistant Secretary (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 retire at age 72 or after twenty years as a trustee, whichever comes first. In addition, the retirement policy requires any independent trustee of 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 own stock of The Charles Schwab Corporation, the parent company of 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.

Barclays U.S. Treasury Bills 1 − 3 Months Index An index that includes all publicly issued zero-coupon U.S. Treasury Bills that have a remaining maturity of less than 3 months and more than 1 month, are rated investment grade, and have $250 million or more of outstanding face 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 capital gain or loss is considered unrealized appreciation or depreciation.

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 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.

Fundamental Developed ex-U.S. Large Company Spliced Index An internally calculated index, comprised of the FTSE RAFI Developed ex-US 1000 Index 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.

Fundamental Developed ex-U.S. Small Company Spliced Index An internally calculated index, comprised of the FTSE RAFI Developed ex-US Mid Small 1500 Index 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.

Fundamental Emerging Markets Large Company Spliced Index An internally calculated index, comprised of the FTSE RAFI Emerging Index 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.

Fundamental U.S. Large Company Spliced Index 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.

Fundamental U.S. Small Company Spliced Index 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.

market cap, market capitalization The value of a company as determined by the total value of all shares of its stock outstanding.

MSCI EAFE (Europe, Australasia, Far East) 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.

68 

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.

restricted and illiquid securities Restricted securities are securities that are subject to legal restrictions on their sale. Restricted securities generally can be sold in privately negotiated transactions, pursuant to an exemption from registration under the Securities Act of1933 (the “1933 Act”), or in a registered public offering. Certain restricted securities, such as Section 4(a)(2) commercial paper and Rule 144A securities under the 1933 Act, may be considered to be liquid if they meet the criteria for liquidity established by the Board. Illiquid securities generally are any securities that cannot be disposed of promptly and in the ordinary course of business at approximately the amount at which a fund has valued the instruments. The liquidity of a fund’s investments is monitored under the supervision and direction of the Board. Investments currently not considered liquid include repurchase agreements not maturing within seven days and certain restricted securities.

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. It includes approximately 2000 of the smallest securities based on a combination of their market cap and current index membership.

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.

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.

69

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 the Schwab Funds’ 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.

^© 2014 Charles Schwab & Co., Inc. All rights reserved.

Member SIPC^®

Printed on recycled paper.

MFR37675-07

00118061

Semiannual report dated April 30, 2014, enclosed.

COMMAND PERFORMANCE^TM

Laudus MarketMasters Funds^tm

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Semiannual Report
April 30, 2014

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™	32
Financial Notes	58
Trustees and Officers	68
Glossary	71

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 Schwab. 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 6 Months Ended April 30, 2014
Laudus Small-Cap MarketMasters Fundtm
Investor Shares (Ticker Symbol: SWOSX)	0.58%
Select Shares® (Ticker Symbol: SWMSX)	0.63%
Russell 2000® Index	3.08%
Fund Category: Morningstar Small Growth	0.76%
Performance Details	pages 6-7
Laudus International MarketMasters Fundtm
Investor Shares1 (Ticker Symbol: SWOIX)	3.67%
Select Shares®1 (Ticker Symbol: SWMIX)	3.75%
MSCI EAFE® Index (Net)*	4.44%
Fund Category: Morningstar Foreign Large Growth	2.66%
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.

For index definitions, please see the Glossary.

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.

*	Effective February 28, 2014, 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 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 regarding the Laudus MarketMasters Funds. Each fund combines complementary strategies from leading investment managers into a single product, providing diversification across multiple investment styles.

For the six-month reporting period ended April 30, 2014, the Laudus International MarketMasters Fund underperformed its comparative index primarily because of manager selection in growth and emerging market stock strategies, which were relative underperformers. The Laudus Small-Cap MarketMasters Fund underperformed its comparative index primarily due to manager selection in small-cap growth stock strategies.

In the U.S., some signs of economic improvement led the Federal Reserve to begin “tapering” its stimulative economic policies. In spite of this policy shift, and harsh winter weather that temporarily slowed economic growth, many major stock market indices reached record highs during April, supported by the Fed’s reassurances that low interest rates remained necessary for now. Overseas, some signs of improvement in the euro zone’s economy and efforts by the European Central Bank to keep interest rates low helped stocks in developed markets generate positive returns. However, political unrest between Russia and the Ukraine drove up market volatility, increased risk,¹ and reduced returns toward the end of the period.

 Asset Class Performance Comparison % returns during the six months ended 4/30/2014

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

	8.36%	S&P 500® Index: measures U.S. large-cap stocks
	3.08%	Russell 2000® Index: measures U.S. small-cap stocks
	4.44%	MSCI EAFE® Index (Net): measures (in U.S. dollars) large-cap stocks in Europe, Australasia and the Far East
	1.74%	Barclays U.S. Aggregate Bond Index: measures the U.S. bond market
	0.02%	Barclays U.S. Treasury Bills 1-3 Months Index: 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.

For index definitions, please see the Glossary.

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-month reporting period ended April 30, 2014, the Laudus International MarketMasters Fund underperformed its comparative index primarily because of manager selection in growth and emerging market stock strategies, which were relative underperformers. The Laudus Small-Cap MarketMasters Fund underperformed its comparative index primarily due to manager selection in small-cap growth stock strategies.

Amid this backdrop, large-cap stocks generally outperformed small-cap stocks, while U.S. stocks generally outperformed stocks in developed international markets with similar market capitalizations. Value stocks outperformed growth stocks, particularly late in the period, as market volatility rose and investors favored companies less tied to strong economic growth. Reflecting this environment, the MSCI EAFE Index returned 4.4%² for the six-month reporting period, and the Russell 2000 Index returned 3.1%.

For more information about the performance, holdings, and portfolio characteristics of the Laudus MarketMasters Funds, please continue reading this report. In addition, you can find further details about these funds by visiting www.laudus.com, or by contacting us at 1-800-435-4000.

Sincerely,

For full definitions of the referenced indices, please see the Glossary.

¹ To find out more information, please read “Investments in Russian Securities” in the “What’s New” section on www.laudus.com.

² The total return cited is for the MSCI EAFE Index (Net), which is calculated net of foreign withholding taxes.

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 04/30/14

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)		0.58	%		16.10	%		15.85	%		6.93	%	6.31%
Select Shares® (6/9/04)		0.63	%		16.25	%		16.04	%				6.80%
Russell 2000® Index		3.08	%		20.50	%		19.84	%		8.67	%	(9/16/97) 7.20%
													(6/9/04) 8.41%
Fund Category: Morningstar Small Growth		0.76	%		20.92	%		20.02	%		8.61	%	(9/16/97)7.73%
													(6/9/04) 8.69%

Fund Expense Ratios³: Investor Shares: Net 1.36%; Gross 1.60% / Select Shares: Net 1.21%; Gross 1.54%

 Investment Managers and Allocations⁴

		% of
Investment Managers	Investment Style	Net Assets
BMO Asset Management Corp.	Small-Cap Growth		35.4	%
Wellington Management Company, LLP	Small-Cap Value		33.1	%
TAMRO Capital Partners LLC	Small-Cap Blend		15.0	%
Mellon Capital Management Corp.	Small-Cap Value		9.3	%
Cash and other assets	—		7.2	%

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.

For index definitions, please see the Glossary.

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% for the Investor Shares and Select Shares. 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.

6 Laudus MarketMasters Funds

 Laudus Small-Cap MarketMasters Fund^tm

Performance and Fund Facts as of 04/30/14 continued

 Statistics

Number of Holdings	1,736
Weighted Average Market Cap ($ x 1,000,000)	$1,982
Price/Earnings Ratio (P/E)	37.7
Price/Book Ratio (P/B)	2.2
Portfolio Turnover Rate1	39%

 Sector Weightings % of Investments

Financials	18.3%
Information Technology	15.7%
Health Care	15.4%
Industrials	15.0%
Consumer Discretionary	12.8%
Energy	6.3%
Materials	3.5%
Consumer Staples	3.1%
Utilities	1.5%
Telecommunication Services	1.3%
Other	7.1%
Total	100.0%

 Top Equity Holdings % of Net Assets²

iShares Russell Mid-Cap ETF	3.1%
Approach Resources, Inc.	1.6%
Belden, Inc.	1.3%
Bellatrix Exploration Ltd.	1.2%
Acacia Research Corp.	1.1%
inContact, Inc.	1.0%
Helen of Troy Ltd.	1.0%
PICO Holdings, Inc.	0.9%
TRI Pointe Homes, Inc.	0.9%
Newcastle Investment Corp.	0.9%
Total	13.0%

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 many 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 04/30/14

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
Investor Shares (10/16/96)		3.67	%		13.13	%		18.27	%	9.56%
Select Shares® (4/2/04)		3.75	%		13.27	%		18.44	%	9.72%
MSCI EAFE® Index (Net)3		4.44	%		13.35	%		13.58	%	6.93%
MSCI EAFE® Index (Gross)3		4.67	%		13.80	%		14.10	%	7.41%
Fund Category: Morningstar Foreign Large Growth		2.66	%		10.39	%		13.97	%	6.97%

Fund Expense Ratios⁴: Investor Shares: Net 1.40%; Gross 1.60% / Select Shares: Net 1.44%; Gross 1.25%

 Investment Managers and Allocations⁵

		% of
Investment Managers	Investment Style	Net Assets
American Century Investment Management, Inc.	International Small-Cap Growth		24.4	%
William Blair & Company, LLC	International Multi-Cap Growth		22.0	%
Mondrian Investment Partners Limited	International Small-Cap Value		21.4	%
Harris Associates L.P.	International Large-Cap Value		20.5	%
Mellon Capital Management Corp.	International Blend		9.1	%
Cash and other assets	—		2.6	%

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.

For index definitions, please see the Glossary.

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.

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	Effective February 28, 2014, 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	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	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 04/30/14 continued

 Statistics

Number of Holdings	1,183
Weighted Average Market Cap ($ x 1,000,000)	$29,066
Price/Earnings Ratio (P/E)	20.1
Price/Book Ratio (P/B)	2.2
Portfolio Turnover Rate1	38%

 Sector Weightings % of Investments

Industrials	22.0%
Financials	19.5%
Consumer Discretionary	18.0%
Information Technology	9.8%
Materials	7.8%
Consumer Staples	6.5%
Health Care	6.1%
Energy	4.1%
Telecommunication Services	1.2%
Utilities	0.9%
Other	4.1%
Total	100.0%

 Top Equity Holdings % of Net Assets²

Credit Suisse Group AG – Reg’d	1.1%
BNP Paribas S.A.	1.0%
Lloyds Banking Group plc	0.9%
Bayerische Motoren Werke AG	0.9%
Intesa Sanpaolo S.p.A.	0.8%
Allianz SE – Reg’d	0.8%
Norma Group SE	0.8%
Toyota Motor Corp.	0.7%
Croda International plc	0.7%
Diageo plc	0.7%
Total	8.4%

 Country Weightings % of Investments

United Kingdom	18.8%
Japan	11.5%
Germany	10.2%
France	9.7%
Switzerland	7.0%
Canada	4.6%
Australia	4.1%
United States	3.9%
Singapore	3.1%
Sweden	3.0%
Italy	2.6%
Netherlands	2.6%
Hong Kong	2.5%
Other Countries	16.4%
Total	100.0%

Portfolio holdings may have changed since the report date.

Source of Sector Classification: S&P and MSCI.

International investments are subject to additional risks such as currency fluctuation, geopolitical risk and the potential for illiquid markets. Investing in emerging markets may accentuate these risks.

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 may incur two types of costs: (1) transaction costs, such as redemption fees; and (2) ongoing costs, including 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, 2013 and held through April 30, 2014.

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 a 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. Therefore, the hypothetical return lines of the table are useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, 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 11/1/13		at 4/30/14		11/1/13–4/30/14
Laudus Small-Cap MarketMasters Fundtm
Investor Shares
Actual Return		1.35%	$	1,000.00	$	1,005.80	$	6.71
Hypothetical 5% Return		1.35%	$	1,000.00	$	1,018.10	$	6.76
Select Shares
Actual Return		1.20%	$	1,000.00	$	1,006.30	$	5.97
Hypothetical 5% Return		1.20%	$	1,000.00	$	1,018.84	$	6.01
Laudus International MarketMasters Fundtm
Investor Shares
Actual Return		1.40%	$	1,000.00	$	1,036.70	$	7.07
Hypothetical 5% Return		1.40%	$	1,000.00	$	1,017.85	$	7.00
Select Shares
Actual Return		1.25%	$	1,000.00	$	1,037.50	$	6.31
Hypothetical 5% Return		1.25%	$	1,000.00	$	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

	11/1/13–			11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–
Investor Shares	4/30/14*			10/31/13			10/31/12			10/31/11			10/31/10			10/31/09
Per-Share Data ($)
Net asset value at beginning of period		17.28			13.14			11.99			11.52			9.40			8.78
Income (loss) from investment operations:
Net investment income (loss)		(0.01	)1		(0.02	)1		(0.10	)1		(0.09	)1		(0.08	)1		(0.05	)1
Net realized and unrealized gains (losses)		0.11			4.16			1.25			0.56			2.20			0.67
Total from investment operations		0.10			4.14			1.15			0.47			2.12			0.62
Less distributions:
Distributions from net investment income		—			—			—			—			—			(0.00	)2
Net asset value at end of period		17.38			17.28			13.14			11.99			11.52			9.40
Total return (%)		0.58	3		31.51			9.59			4.08			22.55			7.10
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		1.35	4		1.35			1.42	5		1.46			1.46			1.48	6
Gross operating expenses		1.58	4		1.59			1.59			1.51			1.50			1.50
Net investment income (loss)		(0.11	)4		(0.16	)		(0.79	)		(0.70	)		(0.72	)		(0.64	)
Portfolio turnover rate		39	3		97			144			95			78			129
Net assets, end of period ($ x 1,000,000)		72			76			65			62			68			64

	11/1/13–			11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–
Select Shares	4/30/14*			10/31/13			10/31/12			10/31/11			10/31/10			10/31/09
Per-Share Data ($)
Net asset value at beginning of period		17.56			13.33			12.14			11.64			9.49			8.86
Income (loss) from investment operations:
Net investment income (loss)		0.00	1,2		(0.00	)1		(0.08	)1		(0.07	)1		(0.06	)1		(0.04	)1
Net realized and unrealized gains (losses)		0.11			4.23			1.27			0.57			2.21			0.68
Total from investment operations		0.11			4.23			1.19			0.50			2.15			0.64
Less distributions:
Distributions from net investment income		—			—			—			—			—			(0.01	)
Net asset value at end of period		17.67			17.56			13.33			12.14			11.64			9.49
Total return (%)		0.63	3		31.73			9.80			4.30			22.66			7.29
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		1.20	4		1.20			1.27	5		1.31			1.32	7		1.33	6
Gross operating expenses		1.52	4		1.53			1.51			1.45			1.45			1.45
Net investment income (loss)		0.04	4		(0.03	)		(0.60	)		(0.54	)		(0.58	)		(0.48	)
Portfolio turnover rate		39	3		97			144			95			78			129
Net assets, end of period ($ x 1,000,000)		115			113			88			219			337			292

* 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, 2014 (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				($)		($)
	90	.6%	Common Stock		148,024,381		169,102,257
	6	.8%	Other Investment Companies		12,228,781		12,666,823
	0	.0%	Rights		2,170		2,170
	0	.0%	Warrants		—		—
	0	.1%	Short-Term Investments		214,985		214,985
	97	.5%	Total Investments		160,470,317		181,986,235
	2	.5%	Other Assets and Liabilities, Net				4,692,557
	100	.0%	Net Assets				186,678,792

	Number		Value
Security	of Shares		($)
Common Stock 90.6% of net assets
Automobiles & Components 0.3%
American Axle & Manufacturing Holdings, Inc. *		803		14,173
Cooper Tire & Rubber Co.		817		20,548
Dana Holding Corp.		1,753		37,111
Dorman Products, Inc. *		200		11,510
Drew Industries, Inc.		170		8,554
Fuel Systems Solutions, Inc. *		223		2,337
Gentherm, Inc. *		278		10,105
Modine Manufacturing Co. *		840		13,843
Standard Motor Products, Inc.		198		7,522
Stoneridge, Inc. *		155		1,657
Superior Industries International, Inc.		233		4,926
Tenneco, Inc. *		722		43,226
Winnebago Industries, Inc. *		14,194		339,237
				514,749
Banks 5.9%
1st Source Corp.		167		4,925
1st United Bancorp, Inc.		253		1,852
Access National Corp.		130		1,917
American National Bankshares, Inc.		73		1,556
Ameris Bancorp *		102		2,170
Ames National Corp.		74		1,615
Arrow Financial Corp.		68		1,702
Astoria Financial Corp.		570		7,558
Banc of California, Inc.		386		4,852
Banco Latinoamericano de Comercio Exterior, S.A., Class E		479		12,320
BancorpSouth, Inc.		1,212		28,312
Bank Mutual Corp.		891		5,364
Bank of Marin Bancorp		43		1,953
Bank of the Ozarks, Inc.		12,712		761,449
BankFinancial Corp.		420		4,133
Banner Corp.		324		12,811
Bar Harbor Bankshares		47		1,766
BBCN Bancorp, Inc.		963		14,840
Berkshire Hills Bancorp, Inc.		188		4,405
BofI Holding, Inc. *		3,811		307,205
Boston Private Financial Holdings, Inc.		946		11,834
Bridge Bancorp, Inc.		76		1,848
Bridge Capital Holdings *		106		2,374
Brookline Bancorp, Inc.		662		6,011
Bryn Mawr Bank Corp.		73		1,991
C&F Financial Corp.		32		1,000
Camden National Corp.		47		1,794
Capital Bank Financial Corp., Class A *		90		2,146
Capital City Bank Group, Inc.		144		2,002
Capitol Federal Financial, Inc.		1,245		14,990
Cardinal Financial Corp.		319		5,359
Cascade Bancorp *		290		1,372
Cathay General Bancorp		913		21,547
Center Bancorp, Inc.		133		2,462
Centerstate Banks, Inc.		196		2,150
Century Bancorp, Inc., Class A		48		1,608
Charter Financial Corp.		168		1,848
Chemical Financial Corp.		186		5,221
Chemung Financial Corp.		50		1,429
Citizens & Northern Corp.		277		5,191
City Holding Co.		117		5,030
Clifton Bancorp, Inc.		136		1,576
CNB Financial Corp.		102		1,685
Columbia Banking System, Inc.		609		15,115
Community Bank System, Inc.		576		21,421
Community Trust Bancorp, Inc.		169		6,231
ConnectOne Bancorp, Inc. *		56		2,688
CVB Financial Corp.		989		14,301
Dime Community Bancshares, Inc.		304		4,955
Doral Financial Corp. *		66		631
Eagle Bancorp, Inc. *		294		9,817
Enterprise Bancorp, Inc.		99		1,808
Enterprise Financial Services Corp.		341		6,094
ESB Financial Corp.		136		1,716
ESSA Bancorp, Inc.		310		3,221
EverBank Financial Corp.		569		10,652
F.N.B. Corp.		1,926		23,959
Farmers Capital Bank Corp. *		75		1,567
Federal Agricultural Mortgage Corp., Class C		62		2,206
Financial Institutions, Inc.		161		3,727
First Bancorp, Inc.		103		1,641
First Busey Corp.		72,009		396,049
First Commonwealth Financial Corp.		784		6,735
First Community Bancshares, Inc.		107		1,585
First Connecticut Bancorp, Inc.		350		5,547
First Defiance Financial Corp.		73		1,972
First Federal Bancshares of Arkansas, Inc. *		215		1,907
First Financial Bancorp		612		9,908
First Financial Bankshares, Inc.		383		22,616

12 See financial notes

 Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
First Financial Corp.		124		3,969
First Financial Holdings, Inc.		154		8,850
First Merchants Corp.		166		3,522
First Midwest Bancorp, Inc.		61,312		1,003,677
First Niagara Financial Group, Inc.		61,100		545,012
FirstMerit Corp.		28,915		560,662
Flushing Financial Corp.		28,822		553,959
Fox Chase Bancorp, Inc.		185		3,086
Franklin Financial Corp. *		185		3,693
German American Bancorp, Inc.		77		2,005
Glacier Bancorp, Inc.		23,250		596,595
Great Southern Bancorp, Inc.		188		5,390
Guaranty Bancorp		155		1,951
Hancock Holding Co.		18,606		627,580
Hanmi Financial Corp.		351		7,466
Heartland Financial USA, Inc.		62		1,507
Heritage Commerce Corp.		248		2,014
Heritage Financial Corp.		278		4,492
Heritage Oaks Bancorp *		282		2,090
Hingham Institution for Savings		27		1,877
Home Bancorp, Inc. *		90		1,822
Home BancShares, Inc.		604		19,153
Home Federal Bancorp, Inc.		136		2,047
Home Loan Servicing Solutions Ltd.		869		19,248
HomeTrust Bancshares, Inc. *		218		3,329
Horizon Bancorp		84		1,679
Iberiabank Corp.		312		19,625
Independent Bank Corp.		171		6,347
Independent Bank Group, Inc.		55		2,707
International Bancshares Corp.		46,357		1,064,357
Investors Bancorp, Inc.		564		15,076
Kearny Financial Corp. *		167		2,435
Lakeland Financial Corp.		158		5,783
LCNB Corp.		79		1,264
MainSource Financial Group, Inc.		122		2,017
MB Financial, Inc.		26,613		714,293
Merchants Bancshares, Inc.		58		1,686
Meridian Interstate Bancorp, Inc. *		92		2,325
Meta Financial Group, Inc.		84		3,520
Metro Bancorp, Inc. *		247		5,044
MGIC Investment Corp. *		3,588		30,857
Middleburg Financial Corp.		90		1,560
MidSouth Bancorp, Inc.		214		3,578
MidWestOne Financial Group, Inc.		70		1,724
NASB Financial, Inc.		66		1,575
National Bank Holdings Corp., Class A		284		5,441
National Bankshares, Inc.		94		3,062
National Penn Bancshares, Inc.		1,336		13,053
NBT Bancorp, Inc.		552		12,503
NewBridge Bancorp *		271		2,084
Northfield Bancorp, Inc.		345		4,475
Northrim BanCorp, Inc.		74		1,775
Northwest Bancshares, Inc.		70,898		942,234
OceanFirst Financial Corp.		300		4,866
OFG Bancorp		167		2,849
Old National Bancorp		1,439		20,319
OmniAmerican Bancorp, Inc.		193		4,798
Oritani Financial Corp.		482		7,148
Pacific Continental Corp.		150		1,977
PacWest Bancorp		988		38,898
Palmetto Bancshares, Inc. *		123		1,662
Park National Corp.		92		6,672
Park Sterling Corp.		898		5,864
Peapack-Gladstone Financial Corp.		128		2,433
Penns Woods Bancorp, Inc.		41		1,804
PennyMac Financial Services, Inc., Class A *		80		1,270
Peoples Bancorp, Inc.		147		3,832
Pinnacle Financial Partners, Inc.		421		14,554
Preferred Bank *		104		2,231
PrivateBancorp, Inc.		713		19,657
Prosperity Bancshares, Inc.		703		41,477
Provident Financial Holdings, Inc.		250		3,517
Provident Financial Services, Inc.		615		10,689
Radian Group, Inc.		2,260		31,595
Renasant Corp.		277		7,540
Republic Bancorp, Inc., Class A		75		1,801
S&T Bancorp, Inc.		199		4,629
Sandy Spring Bancorp, Inc.		230		5,531
Sierra Bancorp		117		1,826
Simmons First National Corp., Class A		206		7,449
Southside Bancshares, Inc.		232		6,400
Southwest Bancorp, Inc.		261		4,359
State Bank Financial Corp.		630		10,445
Sterling Bancorp		409		4,892
Stock Yards Bancorp, Inc.		68		2,005
Suffolk Bancorp *		99		2,171
Sun Bancorp, Inc. *		541		2,056
Susquehanna Bancshares, Inc.		2,136		22,129
Territorial Bancorp, Inc.		73		1,494
Texas Capital Bancshares, Inc. *		529		29,724
The Bancorp, Inc. *		650		10,283
The Bank of Kentucky Financial Corp.		63		2,174
The First of Long Island Corp.		51		1,850
Tompkins Financial Corp.		38		1,791
TowneBank		116		1,790
Trico Bancshares		237		5,747
Tristate Capital Holdings, Inc. *		128		1,674
TrustCo Bank Corp.		1,765		11,667
Trustmark Corp.		679		15,529
UMB Financial Corp.		369		21,664
Umpqua Holdings Corp.		2,285		38,000
Union Bankshares Corp.		492		12,590
United Bankshares, Inc.		674		19,714
United Community Banks, Inc. *		452		7,300
United Financial Bancorp, Inc.		375		6,615
Univest Corp. of Pennsylvania		90		1,774
VantageSouth Bancshares, Inc. *		383		2,352
ViewPoint Financial Group, Inc.		620		16,163
Washington Banking Co.		245		4,214
Washington Trust Bancorp, Inc.		60		2,052
Waterstone Financial, Inc.		190		1,978
Webster Financial Corp.		43,863		1,322,031
WesBanco, Inc.		200		6,048
West Bancorp, Inc.		141		2,046
Westamerica Bancorp		5,867		298,161
Western Alliance Bancorp *		957		22,078
Westfield Financial, Inc.		414		2,836
Wilshire Bancorp, Inc.		1,173		11,730
Wintrust Financial Corp.		409		18,331
WSFS Financial Corp.		32		2,164
				10,935,226

See financial notes 13

 Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Capital Goods 7.8%
AAON, Inc.		318		9,015
AAR Corp.		367		9,505
Accuride Corp. *		750		4,230
Aceto Corp.		475		10,393
Actuant Corp., Class A		17,393		588,927
Acuity Brands, Inc.		405		50,451
Aegion Corp. *		602		15,345
Aerovironment, Inc. *		366		12,360
Aircastle Ltd.		931		16,358
Alamo Group, Inc.		42		2,231
Albany International Corp., Class A		34,539		1,242,713
Altra Industrial Motion Corp.		222		7,584
Ameresco, Inc., Class A *		500		3,205
American Science & Engineering, Inc.		132		8,870
Apogee Enterprises, Inc.		320		10,166
Applied Industrial Technologies, Inc.		6,183		296,289
Argan, Inc.		351		9,396
Astec Industries, Inc.		123		4,914
Astronics Corp. *		236		13,480
AZZ, Inc.		190		8,250
Barnes Group, Inc.		28,713		1,106,025
Beacon Roofing Supply, Inc. *		500		17,790
Blount International, Inc. *		317		3,541
Briggs & Stratton Corp.		380		8,121
Capstone Turbine Corp. *		5,700		11,742
Chart Industries, Inc. *		4,131		281,817
CIRCOR International, Inc.		136		11,045
CLARCOR, Inc.		430		24,837
Comfort Systems USA, Inc.		363		5,445
Cubic Corp.		17,830		845,677
Curtiss-Wright Corp.		560		35,806
DigitalGlobe, Inc. *		893		26,594
Douglas Dynamics, Inc.		430		7,254
DXP Enterprises, Inc. *		129		14,604
Dycom Industries, Inc. *		360		11,304
Dynamic Materials Corp.		194		3,919
EMCOR Group, Inc.		760		34,952
Encore Wire Corp.		156		7,602
EnerSys, Inc.		596		40,278
Engility Holdings, Inc. *		249		10,866
Enphase Energy, Inc. *		247		1,865
EnPro Industries, Inc. *		253		18,016
ESCO Technologies, Inc.		24,104		805,556
Esterline Technologies Corp. *		346		37,721
Federal Signal Corp. *		998		15,150
Franklin Electric Co., Inc.		11,881		459,438
FuelCell Energy, Inc. *		4,100		9,307
Furmanite Corp. *		517		5,418
GATX Corp.		21,300		1,397,919
GenCorp, Inc. *		786		13,802
Generac Holdings, Inc.		616		36,270
General Cable Corp.		378		9,684
Gibraltar Industries, Inc. *		269		4,595
Global Power Equipment Group, Inc.		165		2,892
GrafTech International Ltd. *		706		7,914
Graham Corp.		175		5,222
Granite Construction, Inc.		406		15,176
Great Lakes Dredge & Dock Corp. *		907		7,827
Griffon Corp.		404		4,299
H&E Equipment Services, Inc. *		411		15,844
HEICO Corp.		735		40,660
Hexcel Corp. *		20,660		861,315
Houston Wire & Cable Co.		288		3,588
Hurco Cos., Inc.		62		1,653
Hyster-Yale Materials Handling, Inc.		88		8,482
Innovative Solutions & Support, Inc. *		247		1,662
John Bean Technologies Corp.		331		9,596
Kadant, Inc.		176		6,116
Kaman Corp.		176		7,387
Kratos Defense & Security Solutions, Inc. *		818		5,906
L.B. Foster Co., Class A		39		1,847
Layne Christensen Co. *		350		6,097
Lennox International, Inc.		4,920		412,444
Lindsay Corp.		135		11,898
LSI Industries, Inc.		220		1,674
Luxfer Holdings plc ADR		23,500		464,125
Lydall, Inc. *		323		7,561
MasTec, Inc. *		637		25,212
Meritor, Inc. *		629		7,466
Miller Industries, Inc.		263		5,094
Moog, Inc., Class A *		513		33,576
Mueller Industries, Inc.		54,092		1,565,422
Mueller Water Products, Inc., Class A		1,519		13,853
MYR Group, Inc. *		305		7,155
National Presto Industries, Inc.		23		1,662
NCI Building Systems, Inc. *		471		7,366
Nortek, Inc. *		45		3,697
Northwest Pipe Co. *		60		2,146
Omega Flex, Inc.		119		2,400
Orbital Sciences Corp. *		602		17,699
PGT, Inc. *		204		2,030
Pike Corp. *		141		1,354
PMFG, Inc. *		210		1,191
Polypore International, Inc. *		4,675		162,129
Powell Industries, Inc.		43		2,723
Preformed Line Products Co.		25		1,494
Primoris Services Corp.		575		16,089
Proto Labs, Inc. *		7,551		457,138
Quanex Building Products Corp.		687		12,943
Raven Industries, Inc.		296		9,146
RBC Bearings, Inc. *		163		10,148
Rexnord Corp. *		277		7,407
Rush Enterprises, Inc., Class A *		275		8,828
Simpson Manufacturing Co., Inc.		565		18,526
Sparton Corp. *		100		2,716
Standex International Corp.		110		6,531
Sterling Construction Co., Inc. *		183		1,405
Sun Hydraulics Corp.		156		6,377
TAL International Group, Inc. *		294		12,401
Taser International, Inc. *		811		13,098
Teledyne Technologies, Inc. *		379		35,194
Tennant Co.		211		13,460
Textainer Group Holdings Ltd.		148		5,816
The Gorman-Rupp Co.		178		5,527
The Greenbrier Cos., Inc. *		274		14,369
The KEYW Holding Corp. *		316		4,061
The Middleby Corp. *		214		54,031
Thermon Group Holdings, Inc. *		245		5,836
Titan International, Inc.		760		13,308
Titan Machinery, Inc. *		100		1,764
Trex Co., Inc. *		174		13,662

14 See financial notes

 Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
TriMas Corp. *		18,659		669,112
Triumph Group, Inc.		5,350		346,734
Tutor Perini Corp. *		625		18,500
Twin Disc, Inc.		175		5,063
Universal Forest Products, Inc.		133		6,715
USG Corp. *		864		25,799
Vicor Corp. *		299		2,500
Wabash National Corp. *		40,245		537,673
Watsco, Inc.		6,332		651,626
Watts Water Technologies, Inc., Class A		325		17,290
Woodward, Inc.		729		32,681
Xerium Technologies, Inc. *		350		4,725
				14,490,695
Commercial & Professional Supplies 5.7%
ABM Industries, Inc.		513		13,897
Acacia Research Corp.		129,673		2,079,955
ACCO Brands Corp. *		108,882		667,447
Acorn Energy, Inc. *		192		445
Barrett Business Services, Inc.		134		6,755
Brady Corp., Class A		485		12,508
Casella Waste Systems, Inc., Class A *		875		4,463
CBIZ, Inc. *		487		4,174
CDI Corp.		118		1,808
Ceco Environmental Corp.		237		3,766
Compx International, Inc.		132		1,214
Courier Corp.		120		1,744
CRA International, Inc. *		91		1,981
Deluxe Corp.		586		32,201
EnerNOC, Inc. *		560		13,216
Ennis, Inc.		287		4,294
Exponent, Inc.		89		6,267
FTI Consulting, Inc. *		7,519		257,902
G&K Services, Inc., Class A		24,343		1,288,718
GP Strategies Corp. *		298		7,831
Healthcare Services Group, Inc.		719		20,923
Heidrick & Struggles International, Inc.		102		1,923
Heritage-Crystal Clean, Inc. *		114		1,824
Herman Miller, Inc.		593		18,282
HNI Corp.		475		16,734
Huron Consulting Group, Inc. *		307		21,858
ICF International, Inc. *		382		14,887
InnerWorkings, Inc. *		698		5,026
Insperity, Inc.		333		10,676
Interface, Inc.		681		12,251
Intersections, Inc.		341		1,916
Kelly Services, Inc., Class A		381		8,024
Kforce, Inc.		571		13,202
Kimball International, Inc., Class B		165		2,765
Knoll, Inc.		699		12,715
Korn/Ferry International *		566		16,442
McGrath RentCorp		152		4,800
Mistras Group, Inc. *		196		4,451
MiX Telematics Ltd. ADR *		90,480		950,040
Mobile Mini, Inc.		296		13,077
MSA Safety, Inc.		375		19,781
Multi-Color Corp.		58		2,021
Navigant Consulting, Inc. *		787		13,222
NL Industries, Inc.		152		1,525
On Assignment, Inc. *		20,145		705,075
Pendrell Corp. *		1,575		2,599
Quad Graphics, Inc.		332		7,188
Resources Connection, Inc.		434		5,907
SP Plus Corp. *		43,080		1,052,014
Steelcase, Inc., Class A		743		12,245
Team, Inc. *		331		14,197
Tetra Tech, Inc. *		816		23,395
The Advisory Board Co. *		18,236		1,044,193
The Brink’s Co.		692		17,604
The Corporate Executive Board Co.		6,463		446,076
TRC Cos., Inc. *		251		1,488
TrueBlue, Inc. *		17,738		474,491
UniFirst Corp.		132		12,704
United Stationers, Inc.		33,022		1,239,316
US Ecology, Inc.		45		2,009
Viad Corp.		380		8,759
VSE Corp.		41		2,561
WageWorks, Inc. *		193		8,177
				10,678,949
Consumer Durables & Apparel 4.3%
Arctic Cat, Inc.		229		9,364
Bassett Furniture Industries, Inc.		108		1,489
Beazer Homes USA, Inc. *		98		1,858
Black Diamond, Inc. *		183		2,040
Blyth, Inc.		300		2,811
Brunswick Corp.		1,055		42,400
Callaway Golf Co.		1,416		12,333
Cavco Industries, Inc. *		34		2,650
Columbia Sportswear Co.		204		17,540
Crocs, Inc. *		945		14,298
CSS Industries, Inc.		196		4,698
Culp, Inc.		98		1,769
Ethan Allen Interiors, Inc.		459		11,145
Flexsteel Industries, Inc.		70		2,402
G-III Apparel Group Ltd. *		89		6,388
Helen of Troy Ltd. *		28,543		1,789,646
Hooker Furniture Corp.		107		1,482
Hovnanian Enterprises, Inc., Class A *		808		3,604
Iconix Brand Group, Inc. *		702		29,835
iRobot Corp. *		262		8,777
JAKKS Pacific, Inc.		714		6,255
Johnson Outdoors, Inc., Class A		67		1,402
Kate Spade & Co. *		1,424		49,512
KB Home		991		16,361
La-Z-Boy, Inc.		492		11,921
LeapFrog Enterprises, Inc. *		1,107		7,583
Libbey, Inc. *		233		6,214
Lifetime Brands, Inc.		127		2,426
M.D.C. Holdings, Inc.		372		10,267
M/I Homes, Inc. *		45,968		1,023,707
Marine Products Corp.		229		1,626
Meritage Homes Corp. *		482		18,596
Movado Group, Inc.		234		9,192
NACCO Industries, Inc., Class A		44		2,358
Nautilus, Inc. *		206		1,716
Oxford Industries, Inc.		210		13,862
Perry Ellis International, Inc. *		300		4,530
Quiksilver, Inc. *		64,704		415,400

See financial notes 15

 Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
R. G. Barry Corp.		108		1,974
Skechers U.S.A., Inc., Class A *		433		17,749
Skullcandy, Inc. *		650		5,005
Smith & Wesson Holding Corp. *		945		14,506
Standard Pacific Corp. *		1,287		10,283
Steven Madden Ltd. *		709		25,247
Sturm, Ruger & Co., Inc.		143		9,202
The Ryland Group, Inc.		543		20,846
TRI Pointe Homes, Inc. *		102,650		1,649,586
Tumi Holdings, Inc. *		28,060		572,985
UCP, Inc., Class A *		22,970		325,026
Vera Bradley, Inc. *		351		9,933
Vince Holding Corp. *		18,260		502,333
William Lyon Homes, Class A *		51,380		1,341,018
Wolverine World Wide, Inc.		1,060		29,786
ZAGG, Inc. *		972		4,228
				8,109,164
Consumer Services 2.6%
American Public Education, Inc. *		186		6,436
Ascent Capital Group, Inc., Class A *		89		6,121
Biglari Holdings, Inc. *		13		5,577
BJ’s Restaurants, Inc. *		371		10,592
Bloomin’ Brands, Inc. *		399		8,507
Bob Evans Farms, Inc.		356		16,686
Boyd Gaming Corp. *		838		9,905
Bravo Brio Restaurant Group, Inc. *		350		5,239
Bridgepoint Education, Inc. *		135		2,140
Buffalo Wild Wings, Inc. *		215		31,416
Caesars Entertainment Corp. *		385		7,111
Capella Education Co.		123		7,178
Career Education Corp. *		498		3,596
Choice Hotels International, Inc.		3,950		174,511
Churchill Downs, Inc.		120		10,540
Chuy’s Holdings, Inc. *		43		1,546
Corinthian Colleges, Inc. *		1,452		1,670
Cracker Barrel Old Country Store, Inc.		211		19,990
Denny’s Corp. *		1,027		6,922
DineEquity, Inc.		126		9,552
Diversified Restaurant Holdings, Inc. *		206		1,032
Education Management Corp. *		158		627
Einstein Noah Restaurant Group, Inc.		121		1,859
Fiesta Restaurant Group, Inc. *		203		7,432
Grand Canyon Education, Inc. *		12,989		560,086
Hillenbrand, Inc.		654		19,882
Ignite Restaurant Group, Inc. *		89		1,258
International Speedway Corp., Class A		319		10,029
Interval Leisure Group, Inc.		313		8,066
ITT Educational Services, Inc. *		274		7,398
Jack in the Box, Inc. *		473		25,324
Jamba, Inc. *		114		1,261
JTH Holding, Inc., Class A *		105		2,856
K12, Inc. *		436		10,324
Krispy Kreme Doughnuts, Inc. *		34,046		597,167
Life Time Fitness, Inc. *		423		20,304
LifeLock, Inc. *		53,732		843,592
Lincoln Educational Services Corp.		751		3,064
Luby’s, Inc. *		205		1,111
Marriott Vacations Worldwide Corp. *		253		13,783
Matthews International Corp., Class A		25,610		1,033,363
Morgans Hotel Group Co. *		666		4,995
Multimedia Games Holding Co., Inc. *		310		9,052
Nathan’s Famous, Inc. *		33		1,626
Orient-Express Hotels Ltd., Class A *		1,121		14,685
Papa John’s International, Inc.		432		18,948
Pinnacle Entertainment, Inc. *		608		14,148
Popeyes Louisiana Kitchen, Inc. *		295		11,239
Red Robin Gourmet Burgers, Inc. *		8,669		589,319
Regis Corp.		569		7,477
Ruby Tuesday, Inc. *		766		5,906
Ruth’s Hospitality Group, Inc.		600		7,554
Scientific Games Corp., Class A *		564		6,757
Sonic Corp. *		749		14,261
Sotheby’s		812		34,153
Speedway Motorsports, Inc.		96		1,746
Steiner Leisure Ltd. *		92		3,972
Strayer Education, Inc. *		108		4,604
Texas Roadhouse, Inc.		22,610		559,371
The Cheesecake Factory, Inc.		673		30,211
The Marcus Corp.		350		5,855
Universal Technical Institute, Inc.		400		4,804
Vail Resorts, Inc.		346		23,954
				4,889,690
Diversified Financials 4.4%
Apollo Investment Corp.		2,835		22,652
Arlington Asset Investment Corp., Class A		280		7,406
BGC Partners, Inc., Class A		949		6,804
BlackRock Kelso Capital Corp.		209		1,898
Calamos Asset Management, Inc., Class A		525		6,395
California First National Bancorp		102		1,513
Capital Southwest Corp.		48		1,685
Cash America International, Inc.		385		16,767
Cohen & Steers, Inc.		135		5,469
Credit Acceptance Corp. *		80		10,522
DFC Global Corp. *		729		6,794
Diamond Hill Investment Group, Inc.		21		2,493
Encore Capital Group, Inc. *		184		7,952
Evercore Partners, Inc., Class A		438		23,402
Ezcorp, Inc., Class A *		574		5,987
FBR & Co. *		184		4,747
Fidus Investment Corp.		94		1,722
Fifth Street Finance Corp.		1,407		13,099
Financial Engines, Inc.		590		26,108
First Cash Financial Services, Inc. *		12,313		600,505
FXCM, Inc., Class A		40,078		620,407
Gain Capital Holdings, Inc.		120,260		1,214,626
GAMCO Investors, Inc., Class A		30		2,278
Garrison Capital, Inc.		113		1,593
GFI Group, Inc.		943		3,508
Gladstone Capital Corp.		406		3,926
Gladstone Investment Corp.		600		4,716
Golub Capital BDC, Inc.		96		1,605
Green Dot Corp., Class A *		498		8,650
Greenhill & Co., Inc.		10,710		537,106
GSV Capital Corp. *		375		3,293
Hercules Technology Growth Capital, Inc.		939		12,846
HFF, Inc., Class A		301		10,234

16 See financial notes

 Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number			Value
Security	of Shares			($)
Horizon Technology Finance Corp.		310			4,061
ICG Group, Inc. *		54,127			1,103,108
INTL FCStone, Inc. *		177			3,349
Investment Technology Group, Inc. *		253			5,222
Janus Capital Group, Inc.		1,351			16,388
JMP Group, Inc.		247			1,707
KCAP Financial, Inc.		580			4,623
KCG Holdings, Inc., Class A *		700			6,965
Ladenburg Thalmann Financial Services, Inc. *		1,958			5,345
Main Street Capital Corp.		246			7,734
Manning & Napier, Inc.		300			4,986
MarketAxess Holdings, Inc.		468			25,216
Marlin Business Services Corp.		80			1,374
MCG Capital Corp.		1,300			4,368
Medallion Financial Corp.		375			5,100
Medley Capital Corp.		614			8,007
MVC Capital, Inc.		450			5,868
Nelnet, Inc., Class A		172			7,269
New Mountain Finance Corp.		97			1,388
NewStar Financial, Inc. *		128			1,462
Nicholas Financial, Inc.		110			1,729
PennantPark Floating Rate Capital Ltd.		118			1,640
PennantPark Investment Corp.		634			6,784
PHH Corp. *		497			11,814
PICO Holdings, Inc. *		75,889			1,764,419
Piper Jaffray Cos. *		312			13,684
Portfolio Recovery Associates, Inc. *		10,896			622,706
Prospect Capital Corp.		3,167			34,235
Pzena Investment Management, Inc., Class A		326			3,544
Regional Management Corp. *		66			1,012
Resource America, Inc., Class A		210	��		1,787
Safeguard Scientifics, Inc. *		390			8,194
Solar Capital Ltd.		26,662			583,898
Solar Senior Capital Ltd.		275			4,551
Springleaf Holdings, Inc. *		210			4,826
Stellus Capital Investment Corp.		109			1,466
Stifel Financial Corp. *		12,807			598,983
TCP Capital Corp.		350			5,667
The First Marblehead Corp. *		394			2,072
THL Credit, Inc.		280			3,760
TICC Capital Corp.		100			963
Triangle Capital Corp.		472			12,305
Virtus Investment Partners, Inc. *		53			9,804
Walter Investment Management Corp. *		369			9,808
WhiteHorse Finance, Inc.		111			1,514
WisdomTree Investments, Inc. *		1,219			13,763
World Acceptance Corp. *		2,002			145,345
					8,292,521
Energy 6.1%
Adams Resources & Energy, Inc.		80			5,765
Alon USA Energy, Inc.		425			6,923
Alpha Natural Resources, Inc. *		1,596			6,863
Amyris, Inc. *		611			2,151
Apco Oil & Gas International, Inc. *		55			769
Approach Resources, Inc. *		141,010			2,925,957
Arch Coal, Inc.		2,625			12,023
Basic Energy Services, Inc. *		520			13,738
Bellatrix Exploration Ltd. *		225,410			2,190,985
Bill Barrett Corp. *		503			11,911
Bolt Technology Corp.		101			1,705
Bonanza Creek Energy, Inc. *		279			13,565
BPZ Resources, Inc. *		1,313			3,545
Bristow Group, Inc.		445			34,176
C&J Energy Services, Inc. *		525			15,781
Cal Dive International, Inc. *		845			1,251
Callon Petroleum Co. *		775			7,115
CARBO Ceramics, Inc.		192			26,863
Carrizo Oil & Gas, Inc. *		12,191			670,749
Clayton Williams Energy, Inc. *		52			7,513
Clean Energy Fuels Corp. *		957			8,469
Cloud Peak Energy, Inc. *		915			18,016
Comstock Resources, Inc.		678			18,848
Contango Oil & Gas Co. *		98			4,708
Delek US Holdings, Inc.		226			7,230
Diamondback Energy, Inc. *		13,769			990,542
Emerald Oil, Inc. *		249			1,760
Endeavour International Corp. *		900			3,096
Energy XXI (Bermuda) Ltd.		915			21,896
EPL Oil & Gas, Inc. *		389			15,225
Era Group, Inc. *		24,193			690,710
Evolution Petroleum Corp.		368			4,342
EXCO Resources, Inc.		930			5,906
Exterran Holdings, Inc.		688			29,598
Forest Oil Corp. *		1,042			1,938
Forum Energy Technologies, Inc. *		320			9,555
Frontline Ltd. *		849			2,887
FX Energy, Inc. *		1,211			6,842
GasLog Ltd.		246			6,588
Gastar Exploration, Inc. *		637			4,223
Geospace Technologies Corp. *		2,438			141,721
Goodrich Petroleum Corp. *		399			10,035
Green Plains Renewable Energy, Inc.		321			9,598
Gulf Island Fabrication, Inc.		137			2,748
Gulfmark Offshore, Inc., Class A		323			14,538
Halcon Resources Corp. *		1,475			8,142
Hallador Energy Co.		205			1,878
Helix Energy Solutions Group, Inc. *		1,159			27,862
Hercules Offshore, Inc. *		1,421			6,352
Hornbeck Offshore Services, Inc. *		476			19,721
ION Geophysical Corp. *		1,487			6,543
Isramco, Inc. *		19			2,470
Key Energy Services, Inc. *		1,733			17,399
KiOR, Inc., Class A *		377			230
Knightsbridge Tankers Ltd.		271			3,238
Kodiak Oil & Gas Corp. *		3,097			39,363
Magnum Hunter Resources Corp. *		1,777			15,105
Matador Resources Co. *		488			14,015
Matrix Service Co. *		288			8,919
Midstates Petroleum Co., Inc. *		288			1,699
Miller Energy Resources, Inc. *		401			1,933
Mitcham Industries, Inc. *		316			4,361
Natural Gas Services Group, Inc. *		230			7,059
Newpark Resources, Inc. *		1,132			13,629
Nordic American Tankers Ltd.		851			7,344
Northern Oil & Gas, Inc. *		674			10,400
Nuverra Environmental Solutions, Inc. *		117			1,990
Panhandle Oil & Gas, Inc., Class A		56			2,456

See financial notes 17

 Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Parker Drilling Co. *		1,022		6,776
PDC Energy, Inc. *		405		25,786
Penn Virginia Corp. *		604		10,051
PetroQuest Energy, Inc. *		764		4,599
PHI, Inc. - Non Voting Shares *		154		6,899
Pioneer Energy Services Corp. *		762		11,407
Quicksilver Resources, Inc. *		828		2,699
Renewable Energy Group, Inc. *		128		1,507
Rentech, Inc. *		2,658		5,635
Resolute Energy Corp. *		676		5,070
Rex Energy Corp. *		550		11,583
RigNet, Inc. *		67		3,133
Rosetta Resources, Inc. *		594		28,120
RSP Permian, Inc. *		175		4,961
Sanchez Energy Corp. *		366		10,350
Scorpio Tankers, Inc.		129,706		1,168,651
SEACOR Holdings, Inc. *		14,899		1,242,428
SemGroup Corp., Class A		525		33,537
Ship Finance International Ltd.		846		14,915
Solazyme, Inc. *		249		2,679
Stone Energy Corp. *		422		20,699
Swift Energy Co. *		615		7,583
Synergy Resources Corp. *		226		2,631
T.G.C. Industries, Inc. *		575		2,910
Targa Resources Corp.		315		34,017
Teekay Tankers Ltd., Class A		1,281		4,471
Tesco Corp. *		617		12,340
TETRA Technologies, Inc. *		1,052		13,150
Triangle Petroleum Corp. *		1,061		10,207
Unit Corp. *		7,566		498,978
Uranium Energy Corp. *		1,212		1,297
VAALCO Energy, Inc. *		727		6,703
W&T Offshore, Inc.		463		8,890
Warren Resources, Inc. *		1,494		7,575
Western Refining, Inc.		553		24,055
Westmoreland Coal Co. *		151		4,471
Willbros Group, Inc. *		458		5,088
				11,478,326
Food & Staples Retailing 1.2%
Casey’s General Stores, Inc.		13,830		949,568
Ingles Markets, Inc., Class A		68		1,563
Natural Grocers by Vitamin Cottage, Inc. *		79		2,812
PriceSmart, Inc.		184		17,671
Rite Aid Corp. *		7,310		53,363
Spartan Stores, Inc.		442		9,521
SUPERVALU, Inc. *		1,788		12,498
Susser Holdings Corp. *		215		16,637
The Andersons, Inc.		307		19,123
The Chefs’ Warehouse, Inc. *		99		1,989
The Fresh Market, Inc. *		9,750		361,725
The Pantry, Inc. *		475		7,144
United Natural Foods, Inc. *		10,990		758,640
Village Super Market, Inc., Class A		150		3,628
Weis Markets, Inc.		99		4,563
				2,220,445
Food, Beverage & Tobacco 1.8%
Alico, Inc.		40		1,397
Annie’s, Inc. *		138		4,486
B&G Foods, Inc.		714		23,419
Boulder Brands, Inc. *		689		10,170
Cal-Maine Foods, Inc.		152		9,064
Calavo Growers, Inc.		64		1,990
Chiquita Brands International, Inc. *		516		5,924
Coca-Cola Bottling Co. Consolidated		28		2,303
Craft Brew Alliance, Inc. *		211		3,159
Darling International, Inc. *		1,611		32,236
Diamond Foods, Inc. *		13,737		419,940
Farmer Bros. Co. *		120		2,365
Fresh Del Monte Produce, Inc.		372		10,747
Griffin Land & Nurseries, Inc.		62		1,810
Inventure Foods, Inc. *		208		2,500
J&J Snack Foods Corp.		97		9,079
John B. Sanfilippo & Son, Inc.		86		1,982
Lancaster Colony Corp.		202		19,166
Lifeway Foods, Inc.		98		1,471
Limoneira Co.		88		2,021
National Beverage Corp. *		228		4,396
Pilgrim’s Pride Corp. *		845		18,472
Post Holdings, Inc. *		11,616		607,052
Sanderson Farms, Inc.		7,075		582,060
Seaboard Corp. *		2		4,876
Seneca Foods Corp., Class A *		55		1,562
Snyder’s-Lance, Inc.		528		14,024
The Boston Beer Co., Inc., Class A *		102		25,096
The Hain Celestial Group, Inc. *		7,312		628,978
Tootsie Roll Industries, Inc. (e)		14,112		397,817
TreeHouse Foods, Inc. *		5,620		420,601
Universal Corp.		260		14,188
Vector Group Ltd.		587		12,503
				3,296,854
Health Care Equipment & Services 8.5%
Abaxis, Inc. *		283		11,493
ABIOMED, Inc. *		22,367		529,874
Acadia Healthcare Co., Inc. *		19,765		830,525
Accuray, Inc. *		991		8,324
Air Methods Corp. *		408		22,713
Align Technology, Inc. *		872		43,940
Alliance HealthCare Services, Inc. *		105		2,988
Allscripts Healthcare Solutions, Inc. *		45,500		692,510
Almost Family, Inc. *		220		4,723
Amedisys, Inc. *		616		8,396
AMN Healthcare Services, Inc. *		256		3,195
Amsurg Corp. *		30,866		1,336,806
Analogic Corp.		7,015		526,686
AngioDynamics, Inc. *		540		7,258
Anika Therapeutics, Inc. *		101		4,317
Antares Pharma, Inc. *		750		2,085
ArthroCare Corp. *		284		13,783
athenahealth, Inc. *		418		51,682
AtriCure, Inc. *		446		6,868
Atrion Corp.		18		5,190
Bio-Reference Laboratories, Inc. *		408		10,363
BioScrip, Inc. *		891		6,166
Cantel Medical Corp.		294		9,749
Capital Senior Living Corp. *		175		4,328
Cardiovascular Systems, Inc. *		244		7,015
Centene Corp. *		11,580		768,912

18 See financial notes

 Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Cerus Corp. *		389		1,684
Chemed Corp.		213		17,737
Chindex International, Inc. *		105		2,502
Computer Programs & Systems, Inc.		209		13,194
CONMED Corp.		284		13,158
CorVel Corp. *		8,158		371,515
Cross Country Healthcare, Inc. *		331		2,347
CryoLife, Inc.		266		2,415
Cutera, Inc. *		190		1,959
Cyberonics, Inc. *		319		18,872
Cynosure, Inc., Class A *		56		1,374
Derma Sciences, Inc. *		127		1,313
DexCom, Inc. *		41,529		1,347,201
Emeritus Corp. *		25,118		749,270
Endologix, Inc. *		35,138		445,550
Exactech, Inc. *		178		3,955
ExamWorks Group, Inc. *		430		15,824
Five Star Quality Care, Inc. *		326		1,575
Gentiva Health Services, Inc. *		550		4,142
Globus Medical, Inc., Class A *		25,141		613,943
Greatbatch, Inc. *		288		13,257
Haemonetics Corp. *		13,943		423,309
Hanger, Inc. *		430		14,908
HealthSouth Corp.		11,123		385,301
HealthStream, Inc. *		236		5,345
Healthways, Inc. *		97		1,746
HeartWare International, Inc. *		144		12,234
HMS Holdings Corp. *		42,183		682,099
ICU Medical, Inc. *		19,542		1,090,053
Insulet Corp. *		14,393		541,609
Integra LifeSciences Holdings Corp. *		303		13,811
Invacare Corp.		171		2,702
IPC The Hospitalist Co., Inc. *		160		6,480
Kindred Healthcare, Inc.		501		12,575
Landauer, Inc.		74		3,200
LHC Group, Inc. *		240		4,987
Magellan Health Services, Inc. *		249		14,372
Masimo Corp. *		717		19,187
MedAssets, Inc. *		21,683		495,023
Medical Action Industries, Inc. *		227		1,455
Medidata Solutions, Inc. *		630		22,875
MEDNAX, Inc. *		6,090		360,832
Merge Healthcare, Inc. *		1,173		2,674
Meridian Bioscience, Inc.		185		3,694
Merit Medical Systems, Inc. *		791		10,180
Molina Healthcare, Inc. *		175		6,545
MWI Veterinary Supply, Inc. *		129		20,207
National Healthcare Corp.		93		5,090
National Research Corp., Class A *		104		1,639
Natus Medical, Inc. *		500		12,415
Neogen Corp. *		258		10,778
NuVasive, Inc. *		555		18,709
NxStage Medical, Inc. *		44,288		506,655
Omnicell, Inc. *		424		11,228
OraSure Technologies, Inc. *		921		6,033
Orthofix International N.V. *		107		3,231
Owens & Minor, Inc.		796		26,698
PharMerica Corp. *		487		13,242
Quality Systems, Inc.		584		8,626
Quidel Corp. *		77		1,652
Rockwell Medical, Inc. *		418		4,247
Select Medical Holdings Corp.		656		9,158
Skilled Healthcare Group, Inc., Class A *		239		1,233
Spectranetics Corp. *		611		12,990
Staar Surgical Co. *		395		6,719
STERIS Corp.		16,988		816,273
SurModics, Inc. *		218		4,744
Symmetry Medical, Inc. *		235		1,941
Tandem Diabetes Care, Inc. *		10,386		182,482
Team Health Holdings, Inc. *		736		35,681
TearLab Corp. *		69,246		299,143
The Ensign Group, Inc.		165		7,012
The Providence Service Corp. *		220		8,934
Thoratec Corp. *		19,499		639,177
Tornier N.V. *		101		1,714
Triple-S Management Corp., Class B *		424		6,352
Unilife Corp. *		98,485		320,076
Universal American Corp.		375		2,689
USMD Holdings, Inc. *		44		554
Utah Medical Products, Inc.		34		1,727
Vascular Solutions, Inc. *		325		7,121
Vocera Communications, Inc. *		111		1,693
Volcano Corp. *		804		14,118
WellCare Health Plans, Inc. *		451		30,429
West Pharmaceutical Services, Inc.		610		26,462
Wright Medical Group, Inc. *		480		13,128
				15,801,872
Household & Personal Products 0.0%
Central Garden & Pet Co., Class A *		440		3,639
Elizabeth Arden, Inc. *		249		9,148
Harbinger Group, Inc. *		470		5,480
Inter Parfums, Inc.		107		3,915
Medifast, Inc. *		250		7,913
Nature’s Sunshine Products, Inc.		105		1,403
Nutraceutical International Corp. *		84		2,093
Oil-Dri Corp. of America		61		2,044
Orchids Paper Products Co.		165		4,434
Spectrum Brands Holdings, Inc.		227		17,440
Star Scientific, Inc. *		1,181		775
Synutra International, Inc. *		329		1,836
USANA Health Sciences, Inc. *		63		4,275
WD-40 Co.		99		7,211
				71,606
Insurance 2.1%
Ambac Financial Group, Inc. *		456		13,762
American Equity Investment Life Holding Co.		872		20,335
AMERISAFE, Inc.		14,181		604,820
AmTrust Financial Services, Inc.		366		14,153
Argo Group International Holdings Ltd.		169		7,507
Assured Guaranty Ltd.		24,800		592,968
Baldwin & Lyons, Inc., Class B		70		1,821
Citizens, Inc. *		419		2,753
CNO Financial Group, Inc.		2,609		45,005
Donegal Group, Inc., Class A		120		1,771
eHealth, Inc. *		338		14,159
EMC Insurance Group, Inc.		64		2,111
Employers Holdings, Inc.		433		8,812

See financial notes 19

 Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Enstar Group Ltd. *		83		10,715
FBL Financial Group, Inc., Class A		152		6,796
First American Financial Corp.		1,164		30,963
Fortegra Financial Corp. *		262		1,892
Global Indemnity plc *		72		1,930
Greenlight Capital Re Ltd., Class A *		251		7,989
Hallmark Financial Services, Inc. *		183		1,537
HCI Group, Inc.		209		8,084
Hilltop Holdings, Inc. *		738		16,487
Horace Mann Educators Corp.		497		14,945
Independence Holding Co.		146		1,907
Infinity Property & Casualty Corp.		74		4,749
Investors Title Co.		24		1,698
Kansas City Life Insurance Co.		45		1,871
Maiden Holdings Ltd.		628		7,410
Meadowbrook Insurance Group, Inc.		979		5,482
Montpelier Re Holdings Ltd.		634		19,388
National Interstate Corp.		57		1,597
National Western Life Insurance Co., Class A		9		2,099
OneBeacon Insurance Group Ltd., Class A		425		6,562
Platinum Underwriters Holdings Ltd.		10,678		669,617
Primerica, Inc.		25,630		1,176,161
RLI Corp.		538		23,166
Safety Insurance Group, Inc.		100		5,371
Selective Insurance Group, Inc.		614		14,085
State Auto Financial Corp.		93		1,903
Stewart Information Services Corp.		370		11,285
Symetra Financial Corp.		602		12,437
The Hanover Insurance Group, Inc.		9,991		583,974
The Navigators Group, Inc. *		89		5,070
Tower Group International Ltd.		499		1,228
United Fire Group, Inc.		216		6,009
				3,994,384
Materials 3.4%
A. Schulman, Inc.		317		11,387
A.M. Castle & Co. *		183		2,247
AK Steel Holding Corp. *		2,009		14,063
Allied Nevada Gold Corp. *		271		919
AMCOL International Corp.		426		19,532
American Vanguard Corp.		404		7,195
Ampco-Pittsburgh Corp.		197		3,946
Arabian American Development Co. *		525		5,738
Axiall Corp.		647		30,150
Balchem Corp.		400		24,780
Berry Plastics Group, Inc. *		369		8,299
Calgon Carbon Corp. *		747		14,962
Century Aluminum Co. *		969		13,324
Chase Corp.		76		2,367
Chemtura Corp. *		913		20,360
Clearwater Paper Corp. *		251		15,409
Coeur Mining, Inc. *		1,259		10,903
Commercial Metals Co.		958		18,394
Deltic Timber Corp.		12,856		781,002
Ferro Corp. *		43,583		565,707
Flotek Industries, Inc. *		561		15,714
FutureFuel Corp.		348		6,984
General Moly, Inc. *		1,289		1,418
Globe Specialty Metals, Inc.		678		13,140
Gold Resource Corp.		374		1,724
Graphic Packaging Holding Co. *		1,752		17,975
Greif, Inc., Class A		12,700		688,213
H.B. Fuller Co.		575		26,640
Handy & Harman Ltd. *		99		2,238
Hawkins, Inc.		42		1,520
Haynes International, Inc.		111		5,889
Headwaters, Inc. *		395		4,930
Hecla Mining Co.		2,963		9,096
Horsehead Holding Corp. *		490		7,639
Innophos Holdings, Inc.		339		19,133
Innospec, Inc.		16,559		713,031
Intrepid Potash, Inc. *		309		5,037
Kaiser Aluminum Corp.		195		13,728
KapStone Paper & Packaging Corp. *		1,000		26,380
KMG Chemicals, Inc.		78		1,218
Koppers Holdings, Inc.		16,748		715,140
Kraton Performance Polymers, Inc. *		5,934		154,581
Landec Corp. *		485		5,752
Louisiana-Pacific Corp. *		1,702		27,896
LSB Industries, Inc. *		330		12,603
Materion Corp.		153		5,148
Minerals Technologies, Inc.		298		17,728
Molycorp, Inc. *		1,237		5,876
Myers Industries, Inc.		598		11,183
Neenah Paper, Inc.		178		8,966
Noranda Aluminum Holding Corp.		508		1,803
Olin Corp.		644		18,096
OM Group, Inc.		319		9,343
P.H. Glatfelter Co.		627		16,001
Paramount Gold & Silver Corp. *		3,270		3,303
Penford Corp. *		125		1,575
PolyOne Corp.		1,067		39,980
Quaker Chemical Corp.		100		7,443
Resolute Forest Products, Inc. *		773		13,790
RTI International Metals, Inc. *		324		9,124
Schnitzer Steel Industries, Inc., Class A		373		10,470
Schweitzer-Mauduit International, Inc.		284		12,394
Sensient Technologies Corp.		15,169		819,884
Stepan Co.		149		8,617
Stillwater Mining Co. *		1,215		19,173
SunCoke Energy, Inc. *		956		19,952
Texas Industries, Inc. *		215		18,640
Tredegar Corp.		361		7,512
UFP Technologies, Inc. *		86		2,181
United States Lime & Minerals, Inc.		34		1,838
Universal Stainless & Alloy Products, Inc. *		115		4,127
US Concrete, Inc. *		109		2,684
US Silica Holdings, Inc.		396		17,887
Walter Energy, Inc.		46,607		335,570
Wausau Paper Corp.		522		6,243
Worthington Industries, Inc.		533		19,614
Zep, Inc.		45,206		781,612
				6,326,060
Media 1.0%
Carmike Cinemas, Inc. *		244		7,237
Central European Media Enterprises Ltd., Class A *		775		2,124

20 See financial notes

 Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Crown Media Holdings, Inc., Class A *		678		2,427
Cumulus Media, Inc., Class A *		829		5,314
Daily Journal Corp. *		16		2,821
Entercom Communications Corp., Class A *		610		6,588
Entravision Communications Corp., Class A		301		1,598
Global Sources Ltd. *		270		2,400
Gray Television, Inc. *		475		5,344
Harte-Hanks, Inc.		611		4,913
Hemisphere Media Group, Inc. *		122		1,476
Journal Communications, Inc., Class A *		904		7,250
Lin Media LLC, Class A *		26,450		619,724
Live Nation Entertainment, Inc. *		1,712		35,747
Loral Space & Communications, Inc. *		67		4,823
MDC Partners, Inc., Class A		381		9,304
Meredith Corp.		416		18,333
National CineMedia, Inc.		417		6,334
New Media Investment Group, Inc. *		34,508		492,429
Nexstar Broadcasting Group, Inc., Class A		390		15,542
ReachLocal, Inc. *		133		1,330
Reading International, Inc., Class A *		278		1,968
Rentrak Corp. *		82		4,673
Saga Communications, Inc., Class A		90		3,987
Scholastic Corp.		454		14,941
Sinclair Broadcast Group, Inc., Class A		23,403		625,562
Sizmek, Inc. *		490		4,694
The E.W. Scripps Co., Class A *		356		6,098
The McClatchy Co., Class A *		578		3,167
The New York Times Co., Class A		1,084		17,431
World Wrestling Entertainment, Inc., Class A		170		3,315
				1,938,894
Pharmaceuticals, Biotechnology & Life Sciences 6.6%
ACADIA Pharmaceuticals, Inc. *		837		16,849
Acceleron Pharma, Inc. *		74		2,542
AcelRx Pharmaceuticals, Inc. *		200		2,164
Achillion Pharmaceuticals, Inc. *		1,151		3,280
Acorda Therapeutics, Inc. *		454		16,094
Aegerion Pharmaceuticals, Inc. *		8,050		356,293
Affymetrix, Inc. *		895		6,650
Agios Pharmaceuticals, Inc. *		96		4,038
Akorn, Inc. *		38,312		966,229
Albany Molecular Research, Inc. *		150		2,409
Alnylam Pharmaceuticals, Inc. *		661		32,739
AMAG Pharmaceuticals, Inc. *		86,075		1,571,729
Ampio Pharmaceuticals, Inc. *		296		1,803
Anacor Pharmaceuticals, Inc. *		306		5,040
Arena Pharmaceuticals, Inc. *		3,046		19,494
Arqule, Inc. *		769		1,246
Array BioPharma, Inc. *		758		3,017
Auxilium Pharmaceuticals, Inc. *		28,433		640,027
AVANIR Pharmaceuticals, Inc., Class A *		1,614		8,038
AVEO Pharmaceuticals, Inc. *		805		990
BioDelivery Sciences International, Inc. *		653		5,818
BioTime, Inc. *		427		1,106
Bruker Corp. *		23,559		486,729
Cambrex Corp. *		360		7,376
Cancer Genetics, Inc. *		31,210		458,787
Celldex Therapeutics, Inc. *		1,074		16,110
Cempra, Inc. *		296		2,700
Cepheid, Inc. *		10,828		470,801
Charles River Laboratories International, Inc. *		24,600		1,321,512
Chelsea Therapeutics International Ltd. *		790		3,855
ChemoCentryx, Inc. *		121		663
Chimerix, Inc. *		76		1,468
Clovis Oncology, Inc. *		2,946		159,290
Corcept Therapeutics, Inc. *		907		4,009
Coronado Biosciences, Inc. *		709		1,234
Curis, Inc. *		1,600		3,616
Cytokinetics, Inc. *		140		637
Dendreon Corp. *		2,516		6,491
Depomed, Inc. *		900		12,609
Durata Therapeutics, Inc. *		244		3,304
Dyax Corp. *		1,483		9,803
Dynavax Technologies Corp. *		2,128		3,469
Emergent Biosolutions, Inc. *		323		8,514
Enanta Pharmaceuticals, Inc. *		93		3,461
Endocyte, Inc. *		330		5,976
Enzon Pharmaceuticals, Inc.		1,693		1,507
Epizyme, Inc. *		62		1,353
Exact Sciences Corp. *		804		9,648
Exelixis, Inc. *		1,662		5,883
Fibrocell Science, Inc. *		274		1,041
Fluidigm Corp. *		308		11,568
Foundation Medicine, Inc. *		105		3,062
Furiex Pharmaceuticals, Inc. *		49		5,065
Galena Biopharma, Inc. *		839		2,056
Genomic Health, Inc. *		321		8,423
Geron Corp. *		1,057		2,093
GTx, Inc. *		259		399
Halozyme Therapeutics, Inc. *		1,180		8,791
Harvard Apparatus Regenerative Technology, Inc. *		71		614
Harvard Bioscience, Inc. *		284		1,198
Horizon Pharma, Inc. *		684		9,699
Hyperion Therapeutics, Inc. *		76		1,873
ICON plc *		35,550		1,378,273
Idenix Pharmaceuticals, Inc. *		1,397		7,697
ImmunoGen, Inc. *		1,054		13,639
Immunomedics, Inc. *		1,236		5,204
Impax Laboratories, Inc. *		470		12,291
Infinity Pharmaceuticals, Inc. *		426		4,162
Insmed, Inc. *		337		4,698
Insys Therapeutics, Inc. *		136		5,584
Intercept Pharmaceuticals, Inc. *		68		17,960
InterMune, Inc. *		1,168		37,469
Ironwood Pharmaceuticals, Inc. *		1,036		11,417
Isis Pharmaceuticals, Inc. *		1,187		31,586
KaloBios Pharmaceuticals, Inc. *		334		758
Karyopharm Therapeutics, Inc. *		111		2,978
Keryx Biopharmaceuticals, Inc. *		1,279		18,891
KYTHERA Biopharmaceuticals, Inc. *		154		5,022
Lannett Co., Inc. *		96		3,315
Lexicon Pharmaceuticals, Inc. *		2,643		4,070

See financial notes 21

 Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Ligand Pharmaceuticals, Inc. *		4,816		304,227
Luminex Corp. *		628		12,064
MannKind Corp. *		1,746		11,436
Merrimack Pharmaceuticals, Inc. *		1,070		4,697
MiMedx Group, Inc. *		627		3,624
Momenta Pharmaceuticals, Inc. *		705		8,051
Myriad Genetics, Inc. *		13,640		575,744
Nanosphere, Inc. *		501		857
Nektar Therapeutics *		1,261		14,842
Neurocrine Biosciences, Inc. *		767		10,753
NewLink Genetics Corp. *		187		4,114
Novavax, Inc. *		1,771		7,757
NPS Pharmaceuticals, Inc. *		23,272		619,501
Omeros Corp. *		332		4,110
OncoGenex Pharmaceutical, Inc. *		177		687
Ophthotech Corp. *		97		3,297
OPKO Health, Inc. *		1,949		16,118
Orexigen Therapeutics, Inc. *		911		5,120
Osiris Therapeutics, Inc. *		165		2,348
OvaScience, Inc. *		118		958
Pacific Biosciences of California, Inc. *		687		3,037
Pacira Pharmaceuticals, Inc. *		8,790		602,027
PAREXEL International Corp. *		15,496		702,744
PDL BioPharma, Inc.		1,198		10,171
Peregrine Pharmaceuticals, Inc. *		2,024		3,522
Phibro Animal Health Corp., Class A *		23,300		411,478
Portola Pharmaceuticals, Inc. *		79		1,853
Pozen, Inc. *		383		3,202
Prestige Brands Holdings, Inc. *		576		19,308
Progenics Pharmaceuticals, Inc. *		448		1,581
Prothena Corp. plc *		144		3,168
PTC Therapeutics, Inc. *		126		2,462
Puma Biotechnology, Inc. *		242		18,281
Questcor Pharmaceuticals, Inc.		560		46,021
Raptor Pharmaceutical Corp. *		744		6,153
Receptos, Inc. *		89		3,007
Repligen Corp. *		220		3,487
Repros Therapeutics, Inc. *		264		4,454
Retrophin, Inc. *		196		2,801
Rigel Pharmaceuticals, Inc. *		997		3,190
Sagent Pharmaceuticals, Inc. *		206		4,262
Sangamo BioSciences, Inc. *		538		7,446
Sarepta Therapeutics, Inc. *		320		11,882
Sciclone Pharmaceuticals, Inc. *		344		1,644
Sequenom, Inc. *		1,119		3,055
Spectrum Pharmaceuticals, Inc. *		1,177		8,086
Stemline Therapeutics, Inc. *		66		1,010
Sunesis Pharmaceuticals, Inc. *		329		1,688
Supernus Pharmaceuticals, Inc. *		327		2,685
Synageva BioPharma Corp. *		204		17,619
Synergy Pharmaceuticals, Inc. *		368		1,652
Synta Pharmaceuticals Corp. *		932		3,924
Targacept, Inc. *		850		3,774
TESARO, Inc. *		52		1,298
Tetraphase Pharmaceuticals, Inc. *		213		2,288
TG Therapeutics, Inc. *		269		1,434
The Medicines Co. *		13,472		358,355
TherapeuticsMD, Inc. *		673		2,827
Threshold Pharmaceuticals, Inc. *		1,100		4,510
Ultragenyx Pharmaceutical, Inc. *		70		2,715
Vanda Pharmaceuticals, Inc. *		218		3,037
Verastem, Inc. *		132		1,102
Vical, Inc. *		1,240		1,401
Vivus, Inc. *		1,499		7,795
XenoPort, Inc. *		356		1,445
XOMA Corp. *		1,300		5,772
ZIOPHARM Oncology, Inc. *		1,259		4,532
Zogenix, Inc. *		1,020		2,489
				12,231,275
Real Estate 5.4%
Acadia Realty Trust		578		15,681
AG Mortgage Investment Trust, Inc.		79		1,397
Agree Realty Corp.		205		6,123
Alexander & Baldwin, Inc.		353		13,170
Alexander’s, Inc.		13		4,495
Altisource Residential Corp.		549		15,438
American Assets Trust, Inc.		432		14,666
American Capital Mortgage Investment Corp.		401		7,940
American Realty Capital Properties, Inc.		5,130		67,152
Anworth Mortgage Asset Corp.		1,734		9,364
Apollo Commercial Real Estate Finance, Inc.		505		8,590
Apollo Residential Mortgage, Inc.		306		4,942
Ares Commercial Real Estate Corp.		400		5,104
ARMOUR Residential REIT, Inc.		4,721		20,017
Ashford Hospitality Prime, Inc.		188		2,884
Ashford Hospitality Trust, Inc.		944		9,685
Associated Estates Realty Corp.		410		6,880
AV Homes, Inc. *		99		1,696
Campus Crest Communities, Inc.		58,415		502,953
Capstead Mortgage Corp.		1,244		15,898
Cedar Realty Trust, Inc.		1,016		6,289
Chambers Street Properties		2,296		17,886
Chatham Lodging Trust		243		4,940
Chesapeake Lodging Trust		354		9,554
Colony Financial, Inc.		29,113		633,208
Consolidated-Tomoka Land Co.		43		1,700
CoreSite Realty Corp.		342		10,404
Cousins Properties, Inc.		1,239		14,410
CubeSmart		1,521		28,291
CyrusOne, Inc.		20,390		407,800
CYS Investments, Inc.		2,209		18,997
DCT Industrial Trust, Inc.		2,844		22,240
DiamondRock Hospitality Co.		52,958		649,795
DuPont Fabros Technology, Inc.		773		18,730
Dynex Capital, Inc.		582		4,994
EastGroup Properties, Inc.		304		19,228
Education Realty Trust, Inc.		63,865		651,423
Empire State Realty Trust, Inc., Class A		502		7,681
EPR Properties		484		25,947
Equity One, Inc.		613		13,811
Excel Trust, Inc.		688		8,683
FelCor Lodging Trust, Inc.		1,531		14,131
First Industrial Realty Trust, Inc.		1,384		25,424
First Potomac Realty Trust		864		11,258
Forestar Group, Inc. *		464		7,911
Franklin Street Properties Corp.		1,246		15,176
Getty Realty Corp.		550		10,406

22 See financial notes

 Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Gladstone Commercial Corp.		540		9,526
Glimcher Realty Trust		1,953		19,901
Government Properties Income Trust		544		13,845
Gramercy Property Trust, Inc.		1,200		6,264
Hannon Armstrong Sustainable Infrastructure Capital, Inc.		148		1,957
Healthcare Realty Trust, Inc.		1,087		27,338
Hersha Hospitality Trust		1,259		7,315
Highwoods Properties, Inc.		1,077		43,457
Hudson Pacific Properties, Inc.		611		14,389
Inland Real Estate Corp.		1,250		13,062
Invesco Mortgage Capital, Inc.		1,531		25,522
Investors Real Estate Trust		823		7,177
iStar Financial, Inc. *		1,209		17,966
JAVELIN Mortgage Investment Corp.		342		4,518
Kennedy-Wilson Holdings, Inc.		730		15,943
Kite Realty Group Trust		400		2,480
LaSalle Hotel Properties		43,379		1,434,977
Lexington Realty Trust		1,679		18,066
LTC Properties, Inc.		485		18,735
Medical Properties Trust, Inc.		1,708		23,058
Monmouth Real Estate Investment Corp., Class A		752		7,061
National Health Investors, Inc.		250		15,422
New Residential Investment Corp.		117,363		715,914
New York Mortgage Trust, Inc.		1,050		7,738
Newcastle Investment Corp.		354,560		1,591,974
NorthStar Realty Finance Corp.		3,294		52,770
Parkway Properties, Inc.		352		6,639
Pebblebrook Hotel Trust		561		19,321
Pennsylvania Real Estate Investment Trust		629		10,410
PennyMac Mortgage Investment Trust		872		20,440
Physicians Realty Trust		71,390		979,471
Potlatch Corp.		420		16,057
PS Business Parks, Inc.		150		12,865
RAIT Financial Trust		1,290		10,552
Ramco-Gershenson Properties Trust		811		13,365
Redwood Trust, Inc.		711		15,500
Resource Capital Corp.		1,460		8,030
Retail Opportunity Investments Corp.		927		14,498
RLJ Lodging Trust		1,484		39,578
Rouse Properties, Inc.		488		8,193
Ryman Hospitality Properties, Inc.		602		27,421
Sabra Health Care REIT, Inc.		591		17,712
Saul Centers, Inc.		205		9,407
Select Income REIT		100		3,078
Silver Bay Realty Trust Corp.		373		5,587
Sovran Self Storage, Inc.		372		28,235
STAG Industrial, Inc.		367		8,635
Strategic Hotels & Resorts, Inc. *		1,973		21,289
Summit Hotel Properties, Inc.		123,310		1,117,189
Sun Communities, Inc.		354		16,132
Sunstone Hotel Investors, Inc.		1,913		27,375
Tejon Ranch Co. *		159		4,931
Terreno Realty Corp.		337		6,157
The Geo Group, Inc.		771		25,852
UMH Properties, Inc.		287		2,827
Universal Health Realty Income Trust		106		4,498
Urstadt Biddle Properties, Inc., Class A		224		4,572
Washington Real Estate Investment Trust		491		12,010
Western Asset Mortgage Capital Corp.		145		2,142
Whitestone REIT		404		5,668
Winthrop Realty Trust		146		2,029
				10,038,432
Retailing 4.2%
Aeropostale, Inc. *		1,044		5,189
America’s Car-Mart, Inc. *		38		1,373
ANN, Inc. *		649		25,434
Asbury Automotive Group, Inc. *		434		26,795
Ascena Retail Group, Inc. *		63,400		1,090,480
Barnes & Noble, Inc. *		342		5,609
bebe stores, Inc.		766		3,868
Blue Nile, Inc. *		112		3,890
Body Central Corp. *		174		181
Brown Shoe Co., Inc.		497		11,724
Christopher & Banks Corp. *		284		1,772
Conn’s, Inc. *		257		11,367
Core-Mark Holding Co., Inc.		105		8,457
Destination Maternity Corp.		197		4,858
Express, Inc. *		813		11,845
Five Below, Inc. *		15,069		607,431
Francesca’s Holdings Corp. *		21,897		358,235
Fred’s, Inc., Class A		59,710		1,087,916
FTD Cos., Inc. *		208		6,311
Genesco, Inc. *		257		19,627
Gordmans Stores, Inc.		128		575
Group 1 Automotive, Inc.		250		18,032
hhgregg, Inc. *		110		948
Hibbett Sports, Inc. *		290		15,617
HSN, Inc.		417		24,203
Jos. A. Bank Clothiers, Inc. *		378		24,400
Kirkland’s, Inc. *		300		5,133
Lithia Motors, Inc., Class A		246		18,273
Lumber Liquidators Holdings, Inc. *		321		27,978
Monro Muffler Brake, Inc.		12,221		689,264
Nutrisystem, Inc.		158		2,370
Office Depot, Inc. *		5,328		21,792
Orbitz Worldwide, Inc. *		221		1,624
Outerwall, Inc. *		264		18,308
Penske Automotive Group, Inc.		498		22,838
PetMed Express, Inc.		284		3,718
Pier 1 Imports, Inc.		991		18,096
Pool Corp.		11,384		671,884
RadioShack Corp. *		543		776
Rent-A-Center, Inc.		485		14,167
Restoration Hardware Holdings, Inc. *		10,623		662,769
Select Comfort Corp. *		587		10,801
Shoe Carnival, Inc.		70		1,599
Shutterfly, Inc. *		460		18,828
Sonic Automotive, Inc., Class A		451		10,977
Stage Stores, Inc.		45,186		866,667
Stein Mart, Inc.		616		7,700
Systemax, Inc. *		178		3,078
The Bon-Ton Stores, Inc.		370		4,070
The Buckle, Inc.		280		13,157
The Cato Corp., Class A		44,846		1,277,663

See financial notes 23

 Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
The Children’s Place Retail Stores, Inc.		270		12,960
The Container Store Group, Inc. *		40		1,104
The Finish Line, Inc., Class A		661		18,197
The Men’s Wearhouse, Inc.		598		28,333
The Pep Boys - Manny, Moe & Jack *		705		7,205
Tilly’s, Inc., Class A *		145		1,639
Trans World Entertainment Corp.		344		1,125
Tuesday Morning Corp. *		543		7,591
ValueVision Media, Inc., Class A *		338		1,582
Vitacost.com, Inc. *		446		2,975
Vitamin Shoppe, Inc. *		384		18,386
VOXX International Corp. *		301		3,537
West Marine, Inc. *		151		1,616
Weyco Group, Inc.		68		1,706
Winmark Corp.		26		1,972
Zale Corp. *		197		4,214
Zumiez, Inc. *		232		5,672
				7,889,481
Semiconductors & Semiconductor Equipment 1.5%
Advanced Energy Industries, Inc. *		466		10,196
Alpha & Omega Semiconductor Ltd. *		218		1,570
Ambarella, Inc. *		102		2,535
Amkor Technology, Inc. *		1,019		8,101
Applied Micro Circuits Corp. *		734		7,127
Brooks Automation, Inc.		992		10,148
Cabot Microelectronics Corp. *		357		15,483
Cavium, Inc. *		14,416		610,806
Ceva, Inc. *		286		4,642
Cirrus Logic, Inc. *		607		13,536
Cypress Semiconductor Corp. *		1,129		10,692
Diodes, Inc. *		5,884		155,161
DSP Group, Inc. *		206		1,640
Entegris, Inc. *		1,145		12,698
Entropic Communications, Inc. *		936		3,454
FormFactor, Inc. *		1,000		5,750
GSI Technology, Inc. *		525		3,334
GT Advanced Technologies, Inc. *		1,192		19,799
Hittite Microwave Corp.		339		20,123
Inphi Corp. *		480		7,099
Integrated Device Technology, Inc. *		1,097		12,802
International Rectifier Corp. *		777		20,233
Intersil Corp., Class A		1,102		13,599
IXYS Corp.		155		1,672
Kopin Corp. *		1,298		4,232
Lattice Semiconductor Corp. *		1,055		8,883
LTX-Credence Corp. *		900		8,667
MaxLinear, Inc., Class A *		247		1,944
Micrel, Inc.		50,570		503,677
Microsemi Corp. *		22,394		526,707
MKS Instruments, Inc.		523		14,722
Monolithic Power Systems, Inc. *		539		19,997
Nanometrics, Inc. *		425		6,911
NVE Corp. *		36		1,890
OmniVision Technologies, Inc. *		799		15,605
PDF Solutions, Inc. *		270		5,068
Photronics, Inc. *		432		3,750
PLX Technology, Inc. *		904		5,243
PMC-Sierra, Inc. *		1,362		9,316
Power Integrations, Inc.		409		19,317
Rambus, Inc. *		947		11,449
RF Micro Devices, Inc. *		2,375		20,045
Rubicon Technology, Inc. *		163		1,651
Rudolph Technologies, Inc. *		600		5,466
Semtech Corp. *		713		17,098
Sigma Designs, Inc. *		800		3,016
Silicon Image, Inc. *		1,158		6,496
Spansion, Inc., Class A *		809		14,425
SunEdison, Inc. *		3,002		57,728
SunPower Corp. *		527		17,612
Synaptics, Inc. *		8,424		523,552
Tessera Technologies, Inc.		654		14,342
TriQuint Semiconductor, Inc. *		1,424		20,192
Ultratech, Inc. *		231		6,149
Veeco Instruments, Inc. *		395		14,603
				2,861,953
Software & Services 9.0%
ACI Worldwide, Inc. *		341		19,488
Actuate Corp. *		877		4,938
Acxiom Corp. *		606		17,113
Advent Software, Inc.		481		13,862
American Software, Inc., Class A		406		3,914
Angie’s List, Inc. *		432		4,886
Aspen Technology, Inc. *		24,076		1,035,027
AVG Technologies NV *		67,730		1,268,583
Bankrate, Inc. *		551		9,654
Bazaarvoice, Inc. *		185		1,243
Blackbaud, Inc.		615		18,727
Blackhawk Network Holdings, Inc. *		284		6,813
Blucora, Inc. *		440		8,470
Bottomline Technologies de, Inc. *		560		17,718
Brightcove, Inc. *		39,605		341,395
BroadSoft, Inc. *		386		9,797
CACI International, Inc., Class A *		168		11,701
Callidus Software, Inc. *		675		6,443
Carbonite, Inc. *		132		1,305
Cardtronics, Inc. *		27,185		910,154
Cass Information Systems, Inc.		37		1,869
CIBER, Inc. *		1,423		6,147
CommVault Systems, Inc. *		9,018		436,471
comScore, Inc. *		464		14,537
Comverse, Inc. *		197		4,913
Constant Contact, Inc. *		187		4,836
Convergys Corp.		796		17,146
Conversant, Inc. *		801		19,576
Cornerstone OnDemand, Inc. *		9,470		348,117
CoStar Group, Inc. *		325		52,289
Criteo S.A. ADR *		16,340		522,553
CSG Systems International, Inc.		200		5,272
Cyan, Inc. *		1,001		4,184
Datalink Corp. *		156		2,003
Dealertrack Technologies, Inc. *		360		16,448
Demandware, Inc. *		195		9,678
Dice Holdings, Inc. *		775		5,929
Digimarc Corp.		79		2,609
Digital River, Inc. *		679		10,382
EarthLink Holdings Corp.		768		2,619
Ebix, Inc.		353		5,570
eGain Corp. *		198		1,295
Ellie Mae, Inc. *		167		4,073

24 See financial notes

 Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Envestnet, Inc. *		355		13,082
EPAM Systems, Inc. *		134		4,171
Epiq Systems, Inc.		706		9,030
ePlus, Inc. *		28		1,401
Euronet Worldwide, Inc. *		523		24,053
EVERTEC, Inc.		78		1,836
ExlService Holdings, Inc. *		420		11,884
Fair Isaac Corp.		462		26,426
FleetMatics Group plc *		21,337		640,750
Forrester Research, Inc.		26,139		926,105
Global Cash Access Holdings, Inc. *		785		5,181
Global Eagle Entertainment, Inc. *		45,900		506,277
Guidewire Software, Inc. *		452		17,068
Heartland Payment Systems, Inc.		425		17,400
Higher One Holdings, Inc. *		570		3,414
iGATE Corp. *		257		9,406
Imperva, Inc. *		182		4,164
Infoblox, Inc. *		8,167		160,237
Interactive Intelligence Group, Inc. *		204		12,764
Internap Network Services Corp. *		50,029		336,195
Intralinks Holdings, Inc. *		807		7,384
j2 Global, Inc.		490		22,716
Jive Software, Inc. *		97		726
Liquidity Services, Inc. *		238		4,106
LivePerson, Inc. *		8,783		86,952
LogMeIn, Inc. *		331		15,044
Manhattan Associates, Inc. *		16,361		515,862
ManTech International Corp., Class A		165		4,922
Marin Software, Inc. *		96,480		904,982
Marketo, Inc. *		77		2,090
MAXIMUS, Inc.		27,942		1,189,491
Mentor Graphics Corp.		1,019		21,093
MicroStrategy, Inc., Class A *		122		14,814
Millennial Media, Inc. *		197		1,259
Mitek Systems, Inc. *		320		1,043
ModusLink Global Solutions, Inc. *		891		3,600
MoneyGram International, Inc. *		348		4,594
Monotype Imaging Holdings, Inc.		481		12,703
Monster Worldwide, Inc. *		941		6,483
Move, Inc. *		581		6,211
Net Element International, Inc. *		295		658
Netscout Systems, Inc. *		369		14,376
NIC, Inc.		599		10,986
NICE Systems Ltd. ADR		14,960		646,272
OpenTable, Inc. *		7,919		531,840
Pegasystems, Inc.		610		10,108
Perficient, Inc. *		168		3,069
Progress Software Corp. *		541		11,610
Proofpoint, Inc. *		23,061		586,672
PROS Holdings, Inc. *		257		7,042
PTC, Inc. *		1,218		43,081
QAD, Inc., Class A		148		2,819
Qlik Technologies, Inc. *		1,050		23,079
Qualys, Inc. *		152		2,932
QuinStreet, Inc. *		551		3,361
RealPage, Inc. *		505		8,964
Reis, Inc. *		91		1,498
Rocket Fuel, Inc. *		29,050		931,633
Rosetta Stone, Inc. *		128		1,524
Sapiens International Corp. N.V. *		293		2,306
Sapient Corp. *		1,309		21,297
SciQuest, Inc. *		370		8,873
Seachange International, Inc. *		550		5,154
ServiceSource International, Inc. *		546		3,407
Shutterstock, Inc. *		48		3,480
SPS Commerce, Inc. *		72		3,730
SS&C Technologies Holdings, Inc. *		511		19,888
Stamps.com, Inc. *		166		5,762
Sykes Enterprises, Inc. *		329		6,511
Synchronoss Technologies, Inc. *		435		13,241
Syntel, Inc. *		187		15,020
Take-Two Interactive Software, Inc. *		938		19,116
Tangoe, Inc. *		26,940		405,178
TechTarget, Inc. *		391		2,510
Telenav, Inc. *		470		2,881
TeleTech Holdings, Inc. *		251		6,057
The Hackett Group, Inc.		327		1,962
The Rubicon Project, Inc. *		21,210		304,788
The Ultimate Software Group, Inc. *		293		35,052
TiVo, Inc. *		1,233		14,623
Travelzoo, Inc. *		203		3,642
Trulia, Inc. *		223		7,582
Tyler Technologies, Inc. *		6,871		561,017
Unisys Corp. *		582		14,183
United Online, Inc.		110		1,304
VASCO Data Security International, Inc. *		391		4,461
VeriFone Systems, Inc. *		15,711		525,376
Verint Systems, Inc. *		11,467		501,911
VirnetX Holding Corp. *		369		5,812
Virtusa Corp. *		13,531		446,117
Vistaprint N.V. *		301		11,880
Vocus, Inc. *		319		5,736
Vringo, Inc. *		563		2,303
Web.com Group, Inc. *		624		19,163
WebMD Health Corp. *		328		14,462
WEX, Inc. *		460		44,146
XO Group, Inc. *		322		3,420
Xoom Corp. *		74		1,651
Yelp, Inc. *		356		20,762
Zillow, Inc., Class A *		220		23,914
Zix Corp. *		1,200		3,936
				16,731,804
Technology Hardware & Equipment 4.8%
ADTRAN, Inc.		544		12,202
Aeroflex Holding Corp. *		348		2,662
Agilysys, Inc. *		137		1,718
Alliance Fiber Optic Products, Inc.		514		9,879
Anixter International, Inc.		285		27,924
ARRIS Group, Inc. *		1,386		36,161
Aruba Networks, Inc. *		36,289		717,434
Aviat Networks, Inc. *		1,283		1,937
Badger Meter, Inc.		136		6,739
Bel Fuse, Inc., Class B		120		2,611
Belden, Inc.		33,946		2,505,554
Benchmark Electronics, Inc. *		401		9,295
Black Box Corp.		134		2,849
CalAmp Corp. *		34,744		616,706
Calix, Inc. *		848		7,471
Checkpoint Systems, Inc. *		467		5,964
Ciena Corp. *		1,172		23,170
Cognex Corp. *		862		29,679

See financial notes 25

 Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Coherent, Inc. *		10,004		597,339
Comtech Telecommunications Corp.		372		11,811
Control4 Corp. *		253		4,468
Cray, Inc. *		415		11,915
CTS Corp.		176		3,131
Daktronics, Inc.		790		10,286
Diebold, Inc.		27,400		1,030,514
DTS, Inc. *		346		6,439
Electro Rent Corp.		245		3,957
Electro Scientific Industries, Inc.		263		2,230
Electronics for Imaging, Inc. *		400		15,116
Emulex Corp. *		794		5,677
Extreme Networks, Inc. *		1,418		8,111
Fabrinet *		249		5,378
FARO Technologies, Inc. *		117		4,668
FEI Co.		463		36,818
Finisar Corp. *		1,149		30,046
Fusion-io, Inc. *		445		3,840
GSI Group, Inc. *		370		4,492
Harmonic, Inc. *		788		5,540
Hutchinson Technology, Inc. *		679		1,888
II-VI, Inc. *		798		11,491
Imation Corp. *		950		4,104
Immersion Corp. *		129		1,463
Infinera Corp. *		962		8,619
Insight Enterprises, Inc. *		288		7,523
InterDigital, Inc.		486		16,874
InvenSense, Inc. *		666		14,339
Itron, Inc. *		317		12,046
Ixia *		345		4,285
Kemet Corp. *		1,092		5,471
KVH Industries, Inc. *		129		1,743
Littelfuse, Inc.		273		24,720
Maxwell Technologies, Inc. *		653		9,834
Measurement Specialties, Inc. *		130		8,365
Mercury Systems, Inc. *		600		8,376
Mesa Laboratories, Inc.		31		2,657
Methode Electronics, Inc.		461		12,788
MTS Systems Corp.		7,324		472,178
Multi-Fineline Electronix, Inc. *		162		2,006
NETGEAR, Inc. *		527		17,022
Newport Corp. *		655		12,235
Numerex Corp., Class A *		148		1,517
Oplink Communications, Inc. *		255		4,371
OSI Systems, Inc. *		237		13,227
Park Electrochemical Corp.		140		3,732
Parkervision, Inc. *		408		1,860
PC Connection, Inc.		112		2,241
PC-Tel, Inc.		222		1,831
Plantronics, Inc.		482		21,001
Plexus Corp. *		494		20,708
Procera Networks, Inc. *		410		3,797
QLogic Corp. *		849		9,831
Quantum Corp. *		1,535		1,658
RealD, Inc. *		770		8,439
Rofin-Sinar Technologies, Inc. *		393		8,725
Rogers Corp. *		112		6,722
Ruckus Wireless, Inc. *		45,973		480,418
Sanmina Corp. *		993		20,108
ScanSource, Inc. *		22,306		856,773
ShoreTel, Inc. *		692		5,225
Silicon Graphics International Corp. *		411		4,965
Sonus Networks, Inc. *		1,630		5,330
Speed Commerce, Inc. *		612		2,020
Super Micro Computer, Inc. *		549		11,178
SYNNEX Corp. *		5,237		352,869
Tessco Technologies, Inc.		65		2,138
TTM Technologies, Inc. *		856		6,754
Ubiquiti Networks, Inc. *		99		3,834
Universal Display Corp. *		554		14,432
ViaSat, Inc. *		418		26,840
Vishay Precision Group, Inc. *		109		1,769
Zebra Technologies Corp., Class A *		7,400		513,856
Zygo Corp. *		108		2,078
				8,902,005
Telecommunication Services 1.3%
8x8, Inc. *		50,092		485,892
Atlantic Tele-Network, Inc.		34		2,012
Cincinnati Bell, Inc. *		1,476		4,945
Cogent Communications Group, Inc.		575		19,820
Consolidated Communications Holdings, Inc.		423		8,426
FairPoint Communications, Inc. *		420		5,729
General Communication, Inc., Class A *		408		4,260
Hawaiian Telcom Holdco, Inc. *		69		1,837
HickoryTech Corp.		160		1,899
IDT Corp., Class B		265		4,198
inContact, Inc. *		226,160		1,865,820
Inteliquent, Inc.		360		4,910
Iridium Communications, Inc. *		770		5,136
Lumos Networks Corp.		101		1,334
NII Holdings, Inc. *		972		836
NTELOS Holdings Corp.		106		1,462
Premiere Global Services, Inc. *		922		11,728
Shenandoah Telecommunications Co.		209		5,858
Straight Path Communications, Inc., Class B *		132		924
Towerstream Corp. *		1,185		2,192
USA Mobility, Inc.		257		4,402
Vonage Holdings Corp. *		1,000		3,840
				2,447,460
Transportation 1.2%
Air Transport Services Group, Inc. *		834		6,530
Allegiant Travel Co.		131		15,386
ArcBest Corp.		453		17,857
Atlas Air Worldwide Holdings, Inc. *		9,944		347,940
Echo Global Logistics, Inc. *		281		5,496
Forward Air Corp.		462		20,434
Hawaiian Holdings, Inc. *		36,749		531,023
Heartland Express, Inc.		807		17,560
Hub Group, Inc., Class A *		309		13,797
International Shipholding Corp.		71		1,913
JetBlue Airways Corp. *		2,129		16,830
Knight Transportation, Inc.		414		9,824
Landstar System, Inc.		9,605		605,019
Matson, Inc.		243		5,757
Park-Ohio Holdings Corp. *		53		3,095
Patriot Transportation Holding, Inc. *		56		1,953
Quality Distribution, Inc. *		198		2,489

26 See financial notes

 Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Republic Airways Holdings, Inc. *		835		6,939
Roadrunner Transportation Systems, Inc. *		377		9,285
Saia, Inc. *		142		5,846
Scorpio Bulkers, Inc. *		687		6,149
SkyWest, Inc.		318		3,689
Spirit Airlines, Inc. *		584		33,195
Swift Transportation Co. *		1,082		26,022
Universal Truckload Services, Inc.		73		1,800
UTi Worldwide, Inc.		47,666		466,650
Werner Enterprises, Inc.		681		17,434
Wesco Aircraft Holdings, Inc. *		138		2,796
XPO Logistics, Inc. *		615		16,691
YRC Worldwide, Inc. *		330		7,402
				2,226,801
Utilities 1.5%
ALLETE, Inc.		473		24,482
American States Water Co.		458		13,905
Artesian Resources Corp., Class A		77		1,696
Atlantic Power Corp.		1,045		3,104
Avista Corp.		534		17,168
Black Hills Corp.		521		30,088
California Water Service Group		444		9,990
Chesapeake Utilities Corp.		37		2,341
Cleco Corp.		650		34,157
Connecticut Water Service, Inc.		59		1,917
Delta Natural Gas Co., Inc.		78		1,487
Dynegy, Inc. *		908		25,833
El Paso Electric Co.		450		17,019
Genie Energy Ltd., Class B *		176		1,426
IDACORP, Inc.		546		30,652
MGE Energy, Inc.		265		10,128
Middlesex Water Co.		87		1,769
New Jersey Resources Corp.		9,029		449,012
Northwest Natural Gas Co.		399		17,664
NorthWestern Corp.		410		19,836
NRG Yield, Inc., Class A		106		4,541
Ormat Technologies, Inc.		384		10,245
Otter Tail Corp.		409		11,984
Pattern Energy Group, Inc.		180		4,824
Piedmont Natural Gas Co., Inc.		726		25,983
PNM Resources, Inc.		772		21,369
Portland General Electric Co.		947		31,696
SJW Corp.		65		1,770
South Jersey Industries, Inc.		425		24,416
Southwest Gas Corp.		511		28,110
The Empire District Electric Co.		430		10,458
The Laclede Group, Inc.		10,778		510,985
UIL Holdings Corp.		680		24,976
UNS Energy Corp.		12,511		751,411
WGL Holdings, Inc.		13,875		552,086
York Water Co.		254		5,083
				2,733,611
Total Common Stock
(Cost $148,024,381)				169,102,257
Other Investment Companies 6.8% of net assets
Equity Funds 3.2%
iShares Russell 2000 ETF		460		51,511
iShares Russell Mid-Cap ETF		37,900		5,832,431
				5,883,942
Money Market Fund 3.6%
State Street Institutional U.S. Government Money Market Fund, Institutional Class 0.00% (c)		6,782,881		6,782,881
Total Other Investment Companies
(Cost $12,228,781)				12,666,823
Rights 0.0% of net assets
Telecommunication Services 0.0%
Contra Leap Wireless CVR *(d)		861		2,170
Total Rights
(Cost $2,170)				2,170
Warrants 0.0% of net assets
Energy 0.0%
Magnum Hunter Resources Corp. *(d)		129		—
Total Warrants
(Cost $—)				—
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 0.1% of net assets
U.S. Treasury Obligations 0.1%
U.S. Treasury Bills
0.05%, 06/19/14 (a)(b)		200,000		199,987
0.08%, 06/26/14 (a)(b)		15,000		14,998
Total Short-Term Investments
(Cost $214,985)				214,985
End of Investments.

See financial notes 27

 Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

At 04/30/14, the tax basis cost of the fund’s investments was $160,944,133 and the unrealized appreciation and depreciation were $28,283,418 and ($7,241,316), respectively, with a net unrealized appreciation of $21,042,102.

*	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)	The rate shown is the 7-day yield.
(d)	Fair-valued by management in accordance with procedures approved by the Board of Trustees.
(e)	Illiquid security. At the period end, the value of these amounted to $397,817 or 0.2% of net assets.

ADR —	American Depositary Receipt
CVR —	Contingent Value Rights
ETF —	Exchange traded fund
REIT —	Real Estate Investment Trust

In addition to the above, the fund held the following at 04/30/14:

			Contract		Unrealized
	Number of		Value		Depreciation
	Contracts		($)		($)
Futures Contracts
Russell 2000 Index, mini, Long, expires 06/20/14		69		7,752,840		(106,270	)

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2014 (see financial note 2(a) for additional information):

Assets Valuation Input

	Quoted Prices in					Significant
	Active Markets for			Other Significant		Unobservable
	Identical Assets			Observable Inputs		Inputs
Description	(Level 1)			(Level 2)		(Level 3)		Total
Common Stock1		$169,102,257			$—		$—		$169,102,257
Other Investment Companies1		12,666,823			—		—		12,666,823
Rights1		—			—		2,170		2,170
Warrants1		—			—		—		—
Short-Term Investments1		—			214,985		—		214,985
Total		$181,769,080			$214,985		$2,170		$181,986,235
Liabilities Valuation Input
Other Financial Instruments
Futures Contracts2		($106,270	)		$—		$—		($106,270	)

1	As categorized in portfolio holdings.
2	Futures contracts are not included in Investments in the schedule of portfolio holdings 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		Appreciation		Gross		Gross		Transfers		Transfers		April 30,
Investments in Securities	2013		(Losses)		(Depreciation)		Purchases		Sales		in		out		2014
Rights		$—		$—		$—		$2,170		$—		$—		$—		$2,170
Total		$—		$—		$—		$2,170		$—		$—		$—		$2,170

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, 2014.

28 See financial notes

 Laudus Small-Cap MarketMasters Fund

Statement of

Assets and Liabilities

As of April 30, 2014; unaudited

Assets
Investments, at value (cost $160,470,317)		$181,986,235
Cash		32,366
Receivables:
Investments sold		932,885
Fund shares sold		5,206,810
Dividends		124,659
Variation margin on futures contracts		15,495
Prepaid expenses	+	5,801
Total assets		188,304,251
Liabilities
Payables:
Investments bought		1,544,504
Investment adviser and administrator fees		14,369
Fund shares redeemed		5,990
Accrued expenses	+	60,596
Total liabilities		1,625,459
Net Assets
Total assets		188,304,251
Total liabilities	−	1,625,459
Net assets		$186,678,792
Net Assets by Source
Capital received from investors		172,909,785
Net investment loss		(1,072,288	)
Net realized capital losses		(6,568,353	)
Net unrealized capital appreciation		21,409,648
Net Asset Value (NAV) by Shares Class

			Shares
Share Class	Net Assets	÷	Outstanding	=	NAV
Investor Shares	$72,130,619		4,149,699			$17.38
Select Shares	$114,548,173		6,482,329			$17.67

See financial notes 29

 Laudus Small-Cap MarketMasters Fund

Statement of

Operations

For the period November 1, 2013 through April 30, 2014; unaudited

Investment Income
Dividends (net of foreign withholding taxes of $1,122)		$1,155,135
Interest	+	50
Total investment income		1,155,185
Expenses
Investment adviser and administrator fees		1,089,695
Shareholder service fees:
Investor Shares		92,052
Select Shares		103,363
Portfolio accounting fees		33,332
Shareholder reports		29,876
Transfer agent fees		25,010
Professional fees		22,617
Custodian fees		22,440
Registration fees		15,233
Independent trustees’ fees		3,457
Interest expense		71
Other expenses	+	2,343
Total expenses		1,439,489
Expense reduction by CSIM and its affiliates	−	265,270
Net expenses	−	1,174,219
Net investment loss		(19,034	)
Realized and Unrealized Gains (Losses)
Net realized gains on investments		16,606,311
Net realized gains on futures contracts		81,103
Net realized losses on foreign currency transactions	+	(28	)
Net realized gains		16,687,386
Net change in unrealized appreciation (depreciation) on investments		(15,101,199	)
Net change in unrealized appreciation (depreciation) on futures contracts	+	(201,265	)
Net change in unrealized appreciation (depreciation)	+	(15,302,464	)
Net realized and unrealized gains		1,384,922
Increase in net assets resulting from operations		$1,365,888

30 See financial notes

 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

11/1/13-4/30/14				11/1/12-10/31/13
Net investment loss		($19,034	)		($139,269	)
Net realized gains		16,687,386			29,075,549
Net change in unrealized appreciation (depreciation)	+	(15,302,464	)		18,424,330
Increase in net assets from operations		$1,365,888			$47,360,610

Transactions in Fund Shares

		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		VALUE			SHARES		VALUE
Shares Sold
Investor Shares			51,382		$926,072			122,198		$1,904,239
Select Shares	+		902,147		16,188,602			1,026,670		15,859,002
Total shares sold			953,529		$17,114,674			1,148,868		$17,763,241
Shares Redeemed
Investor Shares			(290,027	)	($5,170,454	)		(669,973	)	($10,039,749	)
Select Shares	+		(844,775	)	(15,259,153	)		(1,210,604	)	(19,403,597	)
Total shares redeemed			(1,134,802	)	($20,429,607	)		(1,880,577	)	($29,443,346	)
Net transactions in fund shares			(181,273	)	($3,314,933	)		(731,709	)	($11,680,105	)
Shares Outstanding and Net Assets
		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			10,813,301		$188,627,837			11,545,010		$152,947,332
Total increase or decrease	+		(181,273	)	(1,949,045	)		(731,709	)	35,680,505
End of period			10,632,028		$186,678,792			10,813,301		$188,627,837
Net investment loss					($1,072,288	)				($1,053,254	)

See financial notes 31

Laudus International MarketMasters Fund™

Financial Statements

Financial Highlights

	11/1/13–			11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–
Investor Shares	4/30/14*			10/31/13			10/31/12			10/31/11			10/31/10			10/31/09
Per-Share Data ($)
Net asset value at beginning of period		23.68			19.03			17.45			18.36			15.04			11.78
Income (loss) from investment operations:
Net investment income (loss)		0.10			0.23			0.21			0.16			0.09			0.14
Net realized and unrealized gains (losses)		0.75			4.85			1.52			(0.85	)		3.41			3.63
Total from investment operations		0.85			5.08			1.73			(0.69	)		3.50			3.77
Less distributions:
Distributions from net investment income		(0.32	)		(0.43	)		(0.15	)		(0.22	)		(0.18	)		(0.51	)
Net asset value at end of period		24.21			23.68			19.03			17.45			18.36			15.04
Total return (%)		3.67	1		27.23			10.05			(3.87	)		23.47			33.64
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		1.40	2		1.40			1.53	3		1.59			1.60			1.62
Gross operating expenses		1.58	2		1.60			1.62			1.60			1.62			1.63
Net investment income (loss)		0.83	2		1.10			1.19			0.80			0.53			0.95
Portfolio turnover rate		38	1		65			68			78			83			96
Net assets, end of period ($ x 1,000,000)		684			675			592			665			849			931

	11/1/13–			11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–
Select Shares	4/30/14*			10/31/13			10/31/12			10/31/11			10/31/10			10/31/09
Per-Share Data ($)
Net asset value at beginning of period		23.68			19.03			17.46			18.38			15.05			11.80
Income (loss) from investment operations:
Net investment income (loss)		0.11			0.28			0.25			0.19			0.10			0.15
Net realized and unrealized gains (losses)		0.76			4.83			1.50			(0.86	)		3.43			3.64
Total from investment operations		0.87			5.11			1.75			(0.67	)		3.53			3.79
Less distributions:
Distributions from net investment income		(0.36	)		(0.46	)		(0.18	)		(0.25	)		(0.20	)		(0.54	)
Net asset value at end of period		24.19			23.68			19.03			17.46			18.38			15.05
Total return (%)		3.75	1		27.43			10.20			(3.76	)		23.68			33.82
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		1.25	2		1.25			1.37	3		1.45			1.48	4		1.47
Gross operating expenses		1.42	2		1.44			1.47			1.47			1.50			1.58
Net investment income (loss)		0.98	2		1.26			1.40			0.99			0.69			1.08
Portfolio turnover rate		38	1		65			68			78			83			96
Net assets, end of period ($ x 1,000,000)		1,638			1,590			1,062			961			948			630

* 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.

32 See financial notes

 Laudus International MarketMasters Fund

Portfolio Holdings as of April 30, 2014 (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	.2%	Common Stock		1,766,369,267		2,209,885,346
	0	.4%	Preferred Stock		8,755,457		9,817,847
	3	.9%	Other Investment Companies		90,531,621		90,127,609
	0	.0%	Rights		37,496		471,511
	0	.0%	Warrants		—		1,403
	0	.2%	Short-Term Investments		4,649,679		4,649,679
	99	.7%	Total Investments		1,870,343,520		2,314,953,395
	0	.3%	Other Assets and Liabilities, Net				6,764,481
	100	.0%	Net Assets				2,321,717,876

	Number		Value
Security	of Shares		($)
Common Stock 95.2% of net assets
Australia 4.1%
Banks 0.4%
Australia & New Zealand Banking Group Ltd.		152,962		4,918,917
Bank of Queensland Ltd.		4,434		50,692
Bendigo & Adelaide Bank Ltd.		6,444		69,064
Commonwealth Bank of Australia		25,310		1,861,826
National Australia Bank Ltd.		36,942		1,216,403
Westpac Banking Corp.		48,839		1,599,698
				9,716,600
Capital Goods 0.4%
Leighton Holdings Ltd.		2,271		40,383
Monadelphous Group Ltd.		509,150		8,301,319
				8,341,702
Commercial & Professional Supplies 0.1%
ALS Ltd.		5,060		35,390
Brambles Ltd.		25,034		220,131
Seek Ltd.		5,528		86,578
Transfield Services Ltd. *		2,260,626		2,024,335
				2,366,434
Consumer Services 0.6%
Crown Resorts Ltd.		6,204		92,835
Echo Entertainment Group Ltd.		12,297		32,343
Flight Centre Travel Group Ltd.		16,472		826,140
G8 Education Ltd.		1,883,930		8,216,635
Invocare Ltd.		429,546		4,258,510
Tabcorp Holdings Ltd.		10,270		35,592
Tatts Group Ltd.		22,383		62,954
				13,525,009
Diversified Financials 0.1%
ASX Ltd.		2,806		92,856
Macquarie Group Ltd.		4,574		246,428
Magellan Financial Group Ltd.		248,850		2,908,156
				3,247,440
Energy 0.0%
Caltex Australia Ltd.		2,024		42,015
Origin Energy Ltd.		16,850		234,078
Santos Ltd.		14,656		187,910
Woodside Petroleum Ltd.		10,320		392,275
WorleyParsons Ltd.		3,314		51,969
				908,247
Food & Staples Retailing 0.1%
Metcash Ltd.		14,377		37,130
Wesfarmers Ltd.		18,030		717,578
Woolworths Ltd.		19,718		685,239
				1,439,947
Food, Beverage & Tobacco 0.0%
Coca-Cola Amatil Ltd.		8,985		77,565
Treasury Wine Estates Ltd.		9,858		35,108
				112,673
Health Care Equipment & Services 0.0%
Cochlear Ltd.		852		46,573
Ramsay Health Care Ltd.		1,970		82,314
Sonic Healthcare Ltd.		5,555		91,631
				220,518
Insurance 0.5%
AMP Ltd.		2,397,135		11,281,297
Insurance Australia Group Ltd.		36,812		196,751
QBE Insurance Group Ltd.		19,616		211,708
Suncorp Group Ltd.		20,038		243,345
				11,933,101
Materials 0.8%
Alumina Ltd. *		36,590		45,962
Amcor Ltd.		19,432		186,488
BHP Billiton Ltd.		50,435		1,776,149
Boral Ltd.		10,945		58,087
DuluxGroup Ltd.		188,958		1,009,265
Fortescue Metals Group Ltd.		25,404		120,159
Iluka Resources Ltd.		6,278		52,156
Incitec Pivot Ltd.		26,096		70,049
Newcrest Mining Ltd. *		11,930		116,355
Orica Ltd.		553,979		11,305,880
Pact Group Holdings Ltd. *		1,352,178		4,255,378
Rio Tinto Ltd.		6,818		393,189
				19,389,117
Media 0.1%
REA Group Ltd.		22,414		977,531
Pharmaceuticals, Biotechnology & Life Sciences 0.2%
CSL Ltd.		65,138		4,152,568
Real Estate 0.6%
CFS Retail Property Trust Group		32,493		60,834
Charter Hall Retail REIT		2,092,788		7,523,098
Dexus Property Group		92,212		97,553
Federation Centres Ltd.		22,668		52,619

See financial notes 33

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Goodman Group		28,028		130,189
GPT Group		30,770		112,290
Lend Lease Group		8,133		98,295
Mirvac Group		60,508		98,740
Shopping Centres Australasia Property Group		3,392,393		5,478,522
Stockland		37,598		136,298
Westfield Group		32,509		331,730
Westfield Retail Trust		45,683		135,723
				14,255,891
Retailing 0.0%
Harvey Norman Holdings Ltd.		7,965		24,377
Software & Services 0.0%
Computershare Ltd.		7,861		90,611
Telecommunication Services 0.2%
Telstra Corp., Ltd.		958,494		4,660,299
Transportation 0.0%
Asciano Ltd.		14,625		73,803
Aurizon Holdings Ltd.		33,984		164,082
Qantas Airways Ltd. *		16,643		18,932
Sydney Airport		16,830		66,133
Toll Holdings Ltd.		10,116		49,898
Transurban Group (a)		22,864		154,420
				527,268
Utilities 0.0%
AGL Energy Ltd.		8,346		122,519
APA Group		12,878		79,822
SP AusNet		24,580		32,032
				234,373
				96,123,706
Austria 0.2%
Banks 0.0%
Erste Group Bank AG		3,933		132,245
Raiffeisen Bank International AG		1,994		63,031
				195,276
Capital Goods 0.2%
Andritz AG		1,076		66,840
Zumtobel AG		140,580		2,923,020
				2,989,860
Energy 0.0%
OMV AG		2,275		106,366
Insurance 0.0%
Vienna Insurance Group AG Wiener Versicherung Gruppe		576		30,806
Materials 0.0%
Voestalpine AG		1,648		75,279
Real Estate 0.0%
BUWOG AG *		671		12,321
IMMOFINANZ AG *		13,432		49,792
				62,113
Telecommunication Services 0.0%
Telekom Austria AG		2,926		29,038
				3,488,738
Belgium 0.1%
Banks 0.0%
KBC Groep N.V.		3,974		242,505
Diversified Financials 0.0%
Groupe Bruxelles Lambert S.A.		1,210		122,343
Food & Staples Retailing 0.0%
Colruyt S.A.		1,136		64,236
Delhaize Group S.A.		1,527		113,705
				177,941
Food, Beverage & Tobacco 0.1%
Anheuser-Busch InBev N.V.		12,573		1,370,405
Insurance 0.0%
Ageas		3,420		147,182
Materials 0.0%
Solvay S.A.		938		152,007
Umicore S.A.		1,709		83,773
				235,780
Media 0.0%
Telenet Group Holding N.V.		838		49,114
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
UCB S.A.		1,687		138,379
Telecommunication Services 0.0%
Belgacom S.A.		2,281		69,816
				2,553,465
Brazil 0.6%
Capital Goods 0.0%
WEG S.A.		34,480		416,126
Consumer Services 0.1%
Kroton Educacional S.A.		101,200		2,167,648
Food, Beverage & Tobacco 0.2%
AMBEV S.A. ADR		611,486		4,433,274
Insurance 0.1%
BB Seguridade Participacoes S.A.		266,000		3,117,201
Software & Services 0.2%
Cielo S.A.		239,500		4,242,740
				14,376,989
Cambodia 0.1%
Consumer Services 0.1%
NagaCorp Ltd.		3,128,000		2,850,263
Canada 4.6%
Automobiles & Components 0.3%
Linamar Corp.		114,890		5,751,576
Banks 0.2%
The Toronto-Dominion Bank		116,921		5,624,966
Capital Goods 0.3%
ATS Automation Tooling Systems, Inc. *		283,100		3,667,734
CAE, Inc.		284,771		3,759,533
				7,427,267

34 See financial notes

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Commercial & Professional Supplies 0.4%
Ritchie Bros. Auctioneers, Inc.		152,200		3,803,438
Stantec, Inc.		93,080		5,516,607
				9,320,045
Consumer Durables & Apparel 0.0%
Gildan Activewear, Inc.		14,500		741,239
Diversified Financials 0.4%
CI Financial Corp.		71,926		2,336,176
Element Financial Corp. *		593,550		7,110,361
				9,446,537
Energy 1.3%
Africa Oil Corp. *		410,020		3,138,725
Canadian Natural Resources Ltd.		94,132		3,835,532
Enbridge, Inc.		108,379		5,229,839
Pason Systems, Inc.		256,900		7,134,744
Raging River Exploration, Inc. *		846,840		7,455,870
Suncor Energy, Inc.		85,500		3,298,153
				30,092,863
Food & Staples Retailing 0.1%
Alimentation Couche-Tard, Inc., Class B		64,986		1,831,502
Materials 0.6%
Capstone Mining Corp. *		1,198,260		3,159,501
CCL Industries, Inc., Class B		76,730		6,976,791
West Fraser Timber Co., Ltd.		63,340		2,831,678
				12,967,970
Media 0.2%
Thomson Reuters Corp.		111,300		4,028,348
Real Estate 0.5%
FirstService Corp.		111,237		5,490,554
Morguard Real Estate Investment Trust		135,490		2,077,995
Northern Property Real Estate Investment Trust		178,000		4,543,990
				12,112,539
Transportation 0.3%
Canadian National Railway Co.		59,527		3,486,496
Canadian Pacific Railway Ltd.		19,476		3,037,672
				6,524,168
				105,869,020
China 1.2%
Capital Goods 0.2%
CIMC Enric Holdings Ltd.		1,976,000		2,866,584
Haitian International Holdings Ltd.		1,426,000		2,872,843
				5,739,427
Energy 0.1%
Hilong Holding Ltd.		2,729,000		1,425,907
Insurance 0.1%
Ping An Insurance (Group) Co. of China Ltd., Class H		214,000		1,588,335
Materials 0.0%
AMVIG Holdings Ltd.		2,290,000		833,647
Pharmaceuticals, Biotechnology & Life Sciences 0.1%
Sihuan Pharmaceutical Holdings Group Ltd.		639,000		701,331
WuXi PharmaTech Cayman, Inc. ADR *		34,975		1,189,150
				1,890,481
Retailing 0.0%
Vipshop Holdings Ltd. ADR *		6,616		927,497
Software & Services 0.4%
58.Com, Inc. ADR *		72,370		2,878,879
Baidu, Inc. ADR *		7,886		1,213,261
Qihoo 360 Technology Co., Ltd. ADR *		8,746		737,987
Tencent Holdings Ltd.		27,800		1,750,286
YY, Inc. ADR *		54,880		3,147,917
				9,728,330
Technology Hardware & Equipment 0.2%
Ju Teng International Holdings Ltd.		4,942,000		3,664,346
Utilities 0.1%
ENN Energy Holdings Ltd.		242,000		1,692,624
				27,490,594
Denmark 2.4%
Banks 0.1%
Danske Bank A/S		10,154		287,289
Jyske Bank A/S - Reg’d *		24,860		1,366,800
				1,654,089
Capital Goods 0.5%
Vestas Wind Systems A/S *		245,220		10,890,484
Consumer Durables & Apparel 0.2%
Pandora A/S		62,462		4,210,597
Energy 0.2%
OW Bunker A/S *		126,020		4,146,011
Food, Beverage & Tobacco 0.5%
Carlsberg A/S, Class B		1,681		168,154
Royal UNIBREW *		72,340		11,260,562
				11,428,716
Health Care Equipment & Services 0.1%
Coloplast A/S, Class B		24,486		2,056,651
GN Store Nord A/S		61,143		1,477,134
William Demant Holding A/S *		443		39,698
				3,573,483
Insurance 0.0%
Tryg A/S		368		34,950
Materials 0.6%
Christian Hansen Holding A/S		319,298		14,395,474
Novozymes A/S, B Shares		3,747		179,650
				14,575,124
Pharmaceuticals, Biotechnology & Life Sciences 0.1%
Novo Nordisk A/S, Class B		75,223		3,414,070
Software & Services 0.1%
SimCorp A/S		31,221		1,198,691
Telecommunication Services 0.0%
TDC A/S		13,238		124,260

See financial notes 35

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Transportation 0.0%
AP Moeller - Maersk A/S, Series A		45		102,234
AP Moeller - Maersk A/S, Series B		100		238,726
DSV A/S		3,059		102,168
				443,128
				55,693,603
Finland 1.0%
Automobiles & Components 0.0%
Nokian Renkaat Oyj		1,651		65,700
Capital Goods 0.6%
Cramo Oyj		276,570		6,179,667
Kone Oyj, Class B		40,148		1,720,961
Metso Oyj		1,916		77,119
Sanitec Corp. *		510,000		5,878,828
Wartsila Oyj Abp		2,658		148,383
				14,004,958
Energy 0.0%
Neste Oil Oyj		1,922		39,464
Insurance 0.4%
Sampo Oyj, A Shares		178,753		8,883,945
Materials 0.0%
Stora Enso Oyj, R Shares		8,723		89,076
UPM-Kymmene Oyj		8,330		145,890
				234,966
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
Orion Oyj, Class B		1,428		43,586
Technology Hardware & Equipment 0.0%
Nokia Oyj *		59,321		444,170
Telecommunication Services 0.0%
Elisa Oyj		2,120		63,324
Utilities 0.0%
Fortum Oyj		6,918		156,292
				23,936,405
France 9.7%
Automobiles & Components 0.7%
Compagnie Generale des Etablissements Michelin		2,955		362,374
Plastic Omnium S.A.		333,980		11,363,783
Renault S.A.		2,997		293,016
Valeo S.A.		34,023		4,672,352
				16,691,525
Banks 1.0%
BNP Paribas S.A.		307,314		23,092,946
Credit Agricole S.A. *		15,951		251,682
Natixis		13,865		98,423
Societe Generale S.A.		11,282		702,611
				24,145,662
Capital Goods 1.0%
Alstom S.A.		3,268		135,047
Bouygues S.A.		2,833		127,601
Compagnie de Saint-Gobain		111,319		6,820,008
Legrand S.A.		4,048		261,566
LISI		10,966		1,780,000
Nexans S.A.		63,503		3,575,324
Rexel S.A.		3,743		94,510
Safran S.A.		44,183		2,973,611
Schneider Electric S.A.		8,655		812,453
Thales S.A.		1,517		96,595
Vallourec S.A.		1,597		94,375
Vinci S.A.		66,186		4,997,461
Zodiac Aerospace		41,350		1,374,790
				23,143,341
Commercial & Professional Supplies 0.0%
Bureau Veritas S.A.		3,576		109,586
Edenred		3,517		118,870
Societe BIC S.A.		431		57,182
				285,638
Consumer Durables & Apparel 1.5%
Christian Dior S.A.		25,961		5,341,624
Hermes International		2,324		816,050
Kering		66,782		14,770,265
LVMH Moet Hennessy Louis Vuitton S.A.		61,352		12,085,990
Nexity S.A.		62,900		2,821,539
				35,835,468
Consumer Services 0.0%
Accor S.A.		2,594		127,001
Sodexo		1,491		160,752
				287,753
Diversified Financials 0.0%
Eurazeo S.A.		520		43,836
Wendel S.A.		493		74,317
				118,153
Energy 1.0%
CGG S.A. *		2,590		44,812
Gaztransport Et Technigaz S.A. *		196,203		13,593,773
Technip S.A.		1,522		171,314
Total S.A.		129,857		9,290,509
				23,100,408
Food & Staples Retailing 0.0%
Carrefour S.A.		9,697		377,999
Casino Guichard Perrachon S.A.		918		116,975
				494,974
Food, Beverage & Tobacco 1.1%
Danone S.A.		183,147		13,523,397
Pernod-Ricard S.A.		98,022		11,763,466
Remy Cointreau S.A.		330		29,022
				25,315,885
Health Care Equipment & Services 0.3%
Essilor International S.A.		3,172		339,681
Korian-Medica		169,948		6,384,855
				6,724,536
Household & Personal Products 0.0%
L’Oreal S.A.		3,759		647,845
Insurance 0.5%
AXA S.A.		325,726		8,500,148
CNP Assurances		2,943		67,894

36 See financial notes

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Euler Hermes S.A.		18,708		2,257,193
SCOR SE		2,591		94,812
				10,920,047
Materials 0.1%
Air Liquide S.A.		4,863		695,737
Arkema S.A.		947		105,772
Imerys S.A.		509		44,699
Lafarge S.A.		2,886		264,066
				1,110,274
Media 0.3%
Eutelsat Communications S.A.		2,392		82,281
JC Decaux S.A.		997		40,927
Lagardere S.C.A.		1,770		74,182
Publicis Groupe S.A.		66,593		5,696,983
				5,894,373
Pharmaceuticals, Biotechnology & Life Sciences 0.8%
Boiron S.A. (b)		74,612		6,291,515
Eurofins Scientific		28,179		7,825,211
Sanofi		47,067		5,079,463
				19,196,189
Real Estate 0.1%
Fonciere Des Regions		412		41,849
Gecina S.A.		329		44,284
ICADE		684		69,787
Klepierre		1,564		71,758
Unibail-Rodamco SE		11,102		3,000,252
				3,227,930
Semiconductors & Semiconductor Equipment 0.0%
STMicroelectronics N.V.		9,557		91,137
Software & Services 0.2%
AtoS		1,151		99,437
Cap Gemini S.A.		10,490		741,157
Criteo S.A. ADR *		109,120		3,489,658
Dassault Systemes S.A.		981		120,720
				4,450,972
Technology Hardware & Equipment 0.6%
Alcatel-Lucent *		44,578		176,784
Ingenico		61,707		5,384,636
Neopost S.A.		86,351		7,090,548
				12,651,968
Telecommunication Services 0.1%
Iliad S.A.		430		116,031
Orange S.A.		29,345		475,426
Vivendi S.A.		18,974		509,770
				1,101,227
Transportation 0.0%
Aeroports de Paris		519		64,541
Groupe Eurotunnel S.A. - Reg’d		8,871		119,091
				183,632
Utilities 0.4%
Electricite de France		3,627		139,280
GDF Suez		20,731		522,492
Rubis S.C.A.		106,491		7,582,551
Suez Environnement Co.		4,195		82,430
Veolia Environnement S.A.		5,454		101,749
				8,428,502
				224,047,439
Germany 9.9%
Automobiles & Components 2.0%
Bayerische Motoren Werke AG		162,177		20,386,450
Continental AG		25,402		5,977,206
Daimler AG - Reg’d		148,802		13,853,336
ElringKlinger AG		121,753		4,915,545
Volkswagen AG		442		118,522
				45,251,059
Banks 0.7%
Aareal Bank AG *		336,490		15,295,041
Commerzbank AG *		15,332		273,388
				15,568,429
Capital Goods 2.2%
Brenntag AG		12,922		2,340,825
DMG MORI SEIKI AG		246,400		7,764,419
Duerr AG		56,531		4,473,058
GEA Group AG		2,817		126,169
Hochtief AG		480		44,753
MAN SE		665		85,273
MTU Aero Engines AG		124,200		11,710,379
Norma Group SE		350,318		18,384,789
OSRAM Licht AG *		1,220		64,049
Rational AG		11,284		3,604,040
Siemens AG - Reg’d		12,394		1,635,019
				50,232,773
Commercial & Professional Supplies 0.5%
Bertrandt AG		6,203		939,661
Bilfinger SE		81,100		9,669,174
				10,608,835
Consumer Durables & Apparel 0.0%
adidas AG		3,242		346,575
Hugo Boss AG		537		74,604
				421,179
Diversified Financials 0.3%
Aurelius AG		155,910		5,793,956
Deutsche Bank AG - Reg’d		15,999		704,683
Deutsche Boerse AG		3,030		222,199
				6,720,838
Food & Staples Retailing 0.0%
Metro AG *		1,944		77,884
Food, Beverage & Tobacco 0.0%
Suedzucker AG		1,360		29,062
Health Care Equipment & Services 0.0%
Celesio AG		1,275		44,312
Fresenius Medical Care AG & Co. KGaA		3,455		238,041
Fresenius SE & Co. KGaA		1,919		291,981
				574,334
Household & Personal Products 0.0%
Beiersdorf AG		1,597		160,314
Henkel AG & Co. KGaA		2,052		210,983
				371,297

See financial notes 37

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Insurance 0.8%
Allianz SE - Reg’d		106,443		18,524,259
Hannover Rueck SE		904		84,237
Muenchener Rueckversicherungs AG - Reg’d		2,796		646,320
				19,254,816
Materials 1.0%
BASF SE		72,396		8,398,349
HeidelbergCement AG		2,226		193,413
K&S AG - Reg’d		2,720		95,309
LANXESS AG		1,318		100,368
Linde AG		2,933		609,139
Symrise AG		279,761		14,132,577
ThyssenKrupp AG *		6,977		199,139
				23,728,294
Media 0.3%
Axel Springer SE		593		36,210
GFK SE (b)		64,177		3,312,136
Kabel Deutschland Holding AG		340		46,047
ProSiebenSat.1 Media AG - Reg’d		75,612		3,309,373
Sky Deutschland AG *		6,081		52,188
				6,755,954
Pharmaceuticals, Biotechnology & Life Sciences 0.7%
Bayer AG - Reg’d		49,941		6,943,880
Merck KGaA		1,024		173,101
MorphoSys AG *		53,085		4,553,315
QIAGEN N.V. *		169,552		3,722,290
				15,392,586
Real Estate 0.0%
Deutsche Wohnen AG		39,988		858,438
Retailing 0.3%
Fielmann AG		50,098		6,777,559
Semiconductors & Semiconductor Equipment 0.1%
Infineon Technologies AG		245,763		2,857,556
Software & Services 0.9%
SAP AG		95,323		7,704,673
United Internet AG - Reg’d		1,612		69,250
Wirecard AG		326,778		13,766,153
				21,540,076
Technology Hardware & Equipment 0.1%
Wincor Nixdorf AG		18,522		1,213,344
Telecommunication Services 0.0%
Deutsche Telekom AG - Reg’d		45,165		758,820
Telefonica Deutschland Holding AG		3,480		28,951
				787,771
Transportation 0.0%
Deutsche Lufthansa AG - Reg’d		3,433		86,212
Deutsche Post AG - Reg’d		14,072		530,978
Fraport AG Frankfurt Airport Services Worldwide		551		40,751
				657,941
Utilities 0.0%
E.ON SE		28,121		538,653
RWE AG		7,791		297,313
				835,966
				230,515,991
Greece 0.3%
Diversified Financials 0.3%
Hellenic Exchanges S.A.		521,490		6,148,173
Hong Kong 2.5%
Automobiles & Components 0.1%
Nexteer Automotive Group Ltd. *		2,736,000		1,799,862
Banks 0.0%
Bank of East Asia Ltd.		21,000		86,748
BOC Hong Kong (Holdings) Ltd.		58,000		170,182
Hang Seng Bank Ltd.		12,000		195,913
				452,843
Capital Goods 0.0%
Hopewell Holdings Ltd.		8,500		29,314
Hutchison Whampoa Ltd.		33,000		452,743
Noble Group Ltd.		73,000		75,167
NWS Holdings Ltd.		20,000		34,299
				591,523
Consumer Durables & Apparel 0.5%
Li & Fung Ltd.		90,000		131,002
Man Wah Holdings Ltd.		2,986,400		4,904,592
Techtronic Industries Co.		2,239,000		7,153,874
Yue Yuen Industrial Holdings Ltd.		11,000		34,078
				12,223,546
Consumer Services 0.4%
Galaxy Entertainment Group Ltd. *		34,000		268,402
Melco International Development Ltd.		839,000		2,582,048
MGM China Holdings Ltd.		269,200		940,634
Paradise Entertainment Ltd. *		6,672,000		4,979,880
Sands China Ltd.		38,000		278,987
Shangri-La Asia Ltd.		26,000		42,931
SJM Holdings Ltd.		29,683		82,576
Wynn Macau Ltd.		23,200		91,816
				9,267,274
Diversified Financials 0.1%
First Pacific Co., Ltd.		36,000		40,032
Hong Kong Exchanges & Clearing Ltd.		61,600		1,107,773
				1,147,805
Insurance 0.2%
AIA Group Ltd.		907,800		4,415,170
Real Estate 0.1%
Cheung Kong (Holdings) Ltd.		21,410		365,626
Hang Lung Properties Ltd.		35,000		104,393
Henderson Land Development Co., Ltd.		16,500		98,628
Hysan Development Co., Ltd.		10,000		42,889
Kerry Properties Ltd.		11,000		36,223
New World Development Co., Ltd.		72,000		74,491
Sino Land Co., Ltd.		44,000		65,977
Sun Hung Kai Properties Ltd.		25,000		315,451

38 See financial notes

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Swire Pacific Ltd., Class A		10,500		121,270
Swire Properties Ltd.		17,800		53,606
The Link REIT		35,500		176,745
Wharf Holdings Ltd.		23,349		163,913
Wheelock & Co., Ltd.		14,000		57,787
				1,676,999
Retailing 0.1%
Emperor Watch & Jewellery Ltd.		25,220,000		1,891,203
Semiconductors & Semiconductor Equipment 0.3%
ASM Pacific Technology Ltd.		242,200		2,692,864
Xinyi Solar Holdings Ltd. *		14,150,000		3,819,243
				6,512,107
Software & Services 0.2%
21Vianet Group Inc. ADR *		191,220		4,593,104
Technology Hardware & Equipment 0.3%
AAC Technologies Holdings, Inc.		1,374,000		7,693,479
China High Precision Automation Group Ltd. *(a)(b)		766,000		—
				7,693,479
Telecommunication Services 0.0%
HKT Trust & HKT Ltd.		34,000		35,647
PCCW Ltd.		60,000		32,039
				67,686
Transportation 0.2%
Cathay Pacific Airways Ltd.		18,000		34,018
MTR Corp., Ltd.		23,500		88,804
Pacific Basin Shipping Ltd.		7,273,000		4,244,205
				4,367,027
Utilities 0.0%
Cheung Kong Infrastructure Holdings Ltd.		11,400		74,500
CLP Holdings Ltd.		28,500		227,841
Hong Kong & China Gas Co., Ltd.		89,540		206,605
Power Assets Holdings Ltd.		21,000		181,532
				690,478
				57,390,106
India 1.2%
Automobiles & Components 0.7%
Apollo Tyres Ltd.		2,101,490		5,563,091
Bharat Forge Ltd.		984,580		6,673,229
Tata Motors Ltd.		397,587		2,750,212
				14,986,532
Banks 0.2%
HDFC Bank Ltd.		242,558		2,903,197
Housing Development Finance Corp., Ltd.		134,757		2,009,169
				4,912,366
Pharmaceuticals, Biotechnology & Life Sciences 0.1%
Sun Pharmaceutical Industries Ltd.		257,134		2,701,251
Software & Services 0.2%
HCL Technologies Ltd.		75,893		1,766,060
Tata Consultancy Services Ltd.		49,484		1,796,287
Tech Mahindra Ltd.		42,856		1,303,103
				4,865,450
				27,465,599
Indonesia 0.4%
Automobiles & Components 0.1%
PT Astra International Tbk		3,629,400		2,338,393
Banks 0.2%
PT Bank Rakyat Indonesia (Persero) Tbk		3,618,400		3,107,318
Retailing 0.1%
PT Matahari Department Store Tbk *		2,134,800		2,773,834
				8,219,545
Ireland 1.6%
Banks 0.0%
Bank of Ireland *		366,051		142,925
Commercial & Professional Supplies 0.6%
Experian plc		788,991		15,169,910
Energy 0.1%
Dragon Oil plc		139,035		1,478,957
Food, Beverage & Tobacco 0.3%
Glanbia plc (f)		358,556		5,345,019
Glanbia plc (f)		38,400		573,487
Kerry Group plc, Class A		2,289		180,694
				6,099,200
Materials 0.2%
CRH plc		98,546		2,869,025
Smurfit Kappa Group plc		93,144		2,075,033
				4,944,058
Pharmaceuticals, Biotechnology & Life Sciences 0.4%
Shire plc		145,041		8,295,176
				36,130,226
Israel 0.5%
Banks 0.0%
Bank Hapoalim B.M.		15,869		89,644
Bank Leumi Le-Israel B.M. *		18,157		71,044
Mizrahi Tefahot Bank Ltd.		1,853		24,770
				185,458
Energy 0.0%
Delek Group Ltd.		68		27,560
Materials 0.3%
Caesarstone Sdot-Yam Ltd.		116,190		6,062,794
Israel Chemicals Ltd.		6,666		59,163
The Israel Corp., Ltd. *		35		19,764
				6,141,721
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
Teva Pharmaceutical Industries Ltd.		13,176		645,887
Software & Services 0.2%
Check Point Software Technologies Ltd. *		88,320		5,657,779

See financial notes 39

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
NICE Systems Ltd.		898		38,864
				5,696,643
Telecommunication Services 0.0%
Bezeq The Israeli Telecommunication Corp., Ltd.		26,399		47,841
				12,745,110
Italy 2.6%
Automobiles & Components 0.2%
Fiat S.p.A. *		13,397		161,738
Piaggio & C. S.p.A.		844,535		3,494,239
Pirelli & C. S.p.A		3,567		60,055
				3,716,032
Banks 1.1%
Banca Monte dei Paschi di Siena S.p.A. *		73,168		24,454
Banca Popolare Di Milano Scarl *		4,201,040		4,248,523
Banco Popolare SC *		5,625		116,248
Intesa Sanpaolo S.p.A.		5,693,404		19,482,993
UniCredit S.p.A.		68,003		609,283
Unione di Banche Italiane S.C.P.A.		13,950		133,160
				24,614,661
Capital Goods 0.4%
Finmeccanica S.p.A. *		6,068		56,156
Interpump Group S.p.A.		573,760		8,134,709
Prysmian S.p.A.		3,054		79,541
				8,270,406
Consumer Durables & Apparel 0.0%
Luxottica Group S.p.A.		2,543		145,858
Prada S.p.A.		71,700		575,036
				720,894
Diversified Financials 0.6%
Azimut Holding S.p.A.		39,417		1,230,510
Banca Generali S.p.A.		431,680		13,588,104
Exor S.p.A.		1,831		83,688
Mediobanca S.p.A. *		7,747		85,984
				14,988,286
Energy 0.1%
Eni S.p.A.		40,037		1,036,931
Saipem S.p.A.		4,111		110,269
Tenaris S.A.		7,371		162,942
				1,310,142
Insurance 0.0%
Assicurazioni Generali S.p.A.		18,445		431,268
UnipolSai S.p.A. *		13,870		51,035
				482,303
Retailing 0.0%
World Duty Free S.p.A. *		66,796		897,364
Technology Hardware & Equipment 0.2%
Ei Towers S.p.A.		75,510		4,295,109
Telecommunication Services 0.0%
Telecom Italia S.p.A. *		161,264		207,229
Telecom Italia S.p.A. - RSP		90,360		89,815
				297,044
Transportation 0.0%
Atlantia S.p.A.		6,011		156,580
Utilities 0.0%
Enel Green Power S.p.A.		26,240		75,099
Enel S.p.A.		103,014		583,464
Snam S.p.A.		32,654		196,412
Terna - Rete Elettrica Nationale S.p.A.		24,618		133,373
				988,348
				60,737,169
Japan 11.5%
Automobiles & Components 2.6%
Aisin Seiki Co., Ltd.		2,900		102,484
Bridgestone Corp.		10,100		361,636
Daihatsu Motor Co., Ltd.		3,000		49,692
Denso Corp.		21,200		965,719
F.C.C. Co., Ltd.		260,400		4,451,174
Fuji Heavy Industries Ltd.		294,200		7,735,892
Honda Motor Co., Ltd.		440,407		14,614,760
Isuzu Motors Ltd.		18,317		106,377
Koito Manufacturing Co., Ltd.		1,485		32,298
Mazda Motor Corp.		44,000		196,735
Mitsubishi Motors Corp.		9,800		106,215
Musashi Seimitsu Industry Co., Ltd.		168,000		3,707,247
NGK Spark Plug Co., Ltd.		3,000		68,684
NHK Spring Co., Ltd.		2,200		19,914
Nifco, Inc.		302,300		8,443,551
Nissan Motors Co., Ltd.		38,900		335,652
NOK Corp.		1,600		26,158
Stanley Electric Co., Ltd.		2,200		48,761
Sumitomo Rubber Industries Ltd.		2,600		36,134
Suzuki Motor Corp.		5,900		152,220
The Yokohama Rubber Co., Ltd.		3,000		26,796
Toyoda Gosei Co., Ltd.		1,000		18,426
Toyota Boshoku Corp.		1,000		10,337
Toyota Industries Corp.		2,514		115,890
Toyota Motor Corp.		312,977		16,909,568
TS Tech Co., Ltd.		16,200		432,051
Yamaha Motor Co., Ltd.		4,200		64,835
				59,139,206
Banks 0.6%
Aozora Bank Ltd.		16,000		47,597
Fukuoka Financial Group, Inc.		12,000		49,008
Hokuhoku Financial Group, Inc.		15,000		28,946
Mitsubishi UFJ Financial Group, Inc.		199,600		1,061,771
Mizuho Financial Group, Inc.		360,900		706,861
Resona Holdings, Inc.		33,900		173,331
Seven Bank Ltd.		8,900		33,742
Shinsei Bank Ltd.		28,000		54,589
Sumitomo Mitsui Financial Group, Inc.		208,700		8,249,974
Sumitomo Mitsui Trust Holdings, Inc.		53,000		218,397
Suruga Bank Ltd.		122,000		2,092,784
The Bank of Kyoto Ltd.		5,000		40,740
The Bank of Yokohama Ltd.		19,000		95,496
The Chiba Bank Ltd.		12,000		76,277

40 See financial notes

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
The Chugoku Bank Ltd.		3,000		39,769
The Gunma Bank Ltd.		6,000		31,892
The Hachijuni Bank Ltd.		7,000		38,269
The Hiroshima Bank Ltd.		8,000		32,914
The Iyo Bank Ltd.		4,000		35,964
The Joyo Bank Ltd.		10,000		48,671
The Nishi-Nippon City Bank Ltd.		10,000		22,746
The Shizuoka Bank Ltd.		8,454		80,778
Yamaguchi Financial Group, Inc.		3,274		30,192
				13,290,708
Capital Goods 1.9%
Aica Kogyo Co., Ltd.		249,300		5,213,438
Aida Engineering Ltd.		387,700		3,700,892
Amada Co., Ltd.		6,000		43,393
Asahi Glass Co., Ltd.		16,000		90,710
Chiyoda Corp.		2,417		32,411
Daifuku Co., Ltd.		486,600		5,610,316
Daikin Industries Ltd.		86,400		4,997,732
FANUC Corp.		17,151		3,094,656
Fuji Electric Co., Ltd.		8,000		36,306
Hino Motors Ltd.		4,000		52,697
Hitachi Construction Machinery Co., Ltd.		1,600		29,690
IHI Corp.		20,000		79,745
ITOCHU Corp.		226,800		2,542,380
JGC Corp.		3,000		97,144
JTEKT Corp.		3,300		48,149
Kajima Corp.		13,000		49,498
Kawasaki Heavy Industries Ltd.		23,000		85,366
Kinden Corp.		2,000		18,413
Komatsu Ltd.		14,600		321,438
Kubota Corp.		17,000		219,105
Kurita Water Industries Ltd.		1,700		35,802
LIXIL Group Corp.		4,000		106,000
Mabuchi Motor Co., Ltd.		400		27,391
Makita Corp.		1,700		90,420
Marubeni Corp.		25,445		170,034
MISUMI Group, Inc.		27,100		659,457
Mitsubishi Corp.		22,149		396,629
Mitsubishi Electric Corp.		30,000		341,605
Mitsubishi Heavy Industries Ltd.		48,000		252,717
Mitsui & Co., Ltd.		27,200		385,760
Nabtesco Corp.		1,400		30,224
NGK Insulators Ltd.		4,000		75,644
Nidec Corp.		65,800		3,720,035
NSK Ltd.		7,000		73,589
Obayashi Corp.		10,000		64,569
Sanwa Holdings Corp.		468,000		2,859,123
Shimizu Corp.		9,000		51,018
SMC Corp.		10,637		2,532,199
Sojitz Corp.		18,800		29,644
Sumitomo Corp.		17,400		225,860
Sumitomo Electric Industries Ltd.		11,800		163,326
Sumitomo Heavy Industries Ltd.		9,000		38,294
Tadano Ltd.		289,000		4,086,401
Taisei Corp.		15,000		69,539
The Japan Steel Works Ltd.		5,000		21,126
THK Co., Ltd.		1,800		38,046
Toshiba Corp.		62,000		242,845
TOTO Ltd.		86,313		1,220,928
Toyota Tsusho Corp.		3,200		84,285
				44,455,989
Commercial & Professional Supplies 0.2%
Dai Nippon Printing Co., Ltd.		9,000		81,066
Meitec Corp.		43,200		1,150,128
Park24 Co., Ltd.		1,500		27,419
Secom Co., Ltd.		54,300		3,117,531
Toppan Printing Co., Ltd.		9,000		61,810
				4,437,954
Consumer Durables & Apparel 0.3%
Asics Corp.		2,200		42,819
Casio Computer Co., Ltd.		3,600		41,081
Fujitsu General Ltd.		449,000		5,181,423
Iida Group Holdings Co., Ltd.		2,000		29,847
Namco Bandai Holdings, Inc.		2,900		62,655
Nikon Corp.		5,300		83,096
Panasonic Corp.		33,900		369,512
Rinnai Corp.		500		41,669
Sankyo Co., Ltd.		800		31,993
Sega Sammy Holdings, Inc.		3,200		64,503
Sekisui Chemical Co., Ltd.		7,000		70,939
Sekisui House Ltd.		8,355		100,290
Sharp Corp. *		24,419		61,213
Shimano, Inc.		1,145		114,456
Sony Corp.		16,500		289,667
Yamaha Corp.		2,400		32,157
				6,617,320
Consumer Services 0.0%
Benesse Holdings, Inc.		1,000		38,048
McDonald’s Holdings Co., Ltd.		1,000		27,668
Oriental Land Co., Ltd.		800		119,851
				185,567
Diversified Financials 0.8%
Acom Co., Ltd. *		6,100		20,790
AEON Financial Service Co., Ltd.		2,000		50,367
Century Tokyo Leasing Corp.		32,300		934,753
Credit Saison Co., Ltd.		2,600		55,388
Daiwa Securities Group, Inc.		1,384,000		10,377,836
Japan Exchange Group, Inc.		4,000		79,144
Mitsubishi UFJ Lease & Finance Co., Ltd.		8,700		42,924
Nomura Holdings, Inc.		56,200		325,447
ORIX Corp.		393,500		5,701,753
SBI Holdings, Inc.		3,336		38,150
				17,626,552
Energy 0.0%
Idemitsu Kosan Co., Ltd.		1,300		28,748
Inpex Corp.		13,600		198,334
Japan Petroleum Exploration Co.		400		14,890
JX Holdings, Inc.		34,900		181,334
Showa Shell Sekiyu K.K.		2,800		28,404
TonenGeneral Sekiyu K.K.		4,367		41,250
				492,960
Food & Staples Retailing 0.1%
Aeon Co., Ltd.		9,500		109,722
FamilyMart Co., Ltd.		1,000		41,525
Lawson, Inc.		929		64,521
Seven & i Holdings Co., Ltd.		11,700		461,638
Sundrug Co., Ltd.		2,800		114,555

See financial notes 41

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Tsuruha Holdings, Inc.		8,100		815,237
				1,607,198
Food, Beverage & Tobacco 0.2%
Ajinomoto Co., Inc.		10,000		147,178
Ariake Japan Co., Ltd.		131,000		3,164,280
Asahi Group Holdings Ltd.		6,100		168,560
Calbee, Inc.		1,200		29,429
Coca-Cola West Co., Ltd.		900		15,664
Japan Tobacco, Inc.		17,300		568,626
Kikkoman Corp.		3,000		60,955
Kirin Holdings Co., Ltd.		14,000		193,900
MEIJI Holdings Co., Ltd.		1,000		61,367
Nippon Meat Packers, Inc.		3,000		51,994
Nisshin Seifun Group, Inc.		3,300		38,394
Nissin Foods Holdings Co., Ltd.		900		43,080
Suntory Beverage & Food Ltd.		2,300		80,321
Toyo Suisan Kaisha Ltd.		1,365		43,723
Yakult Honsha Co., Ltd.		1,500		81,075
Yamazaki Baking Co., Ltd.		2,000		24,437
				4,772,983
Health Care Equipment & Services 1.0%
Alfresa Holdings Corp.		600		37,354
Hogy Medical Co., Ltd.		97,200		5,013,196
M3, Inc.		308,000		4,225,313
Medipal Holdings Corp.		2,200		30,944
Miraca Holdings, Inc.		125,800		5,453,092
Olympus Corp. *		208,100		6,356,305
Ship Healthcare Holdings, Inc.		83,700		2,854,374
Suzuken Co., Ltd.		1,100		39,650
Sysmex Corp.		2,200		69,744
Terumo Corp.		4,800		95,259
				24,175,231
Household & Personal Products 0.2%
Kao Corp.		64,200		2,416,963
Pigeon Corp.		65,500		2,932,504
Shiseido Co., Ltd.		5,400		96,476
Unicharm Corp.		1,800		97,610
				5,543,553
Insurance 0.0%
MS&AD Insurance Group Holdings		7,810		175,195
NKSJ Holdings, Inc.		5,900		147,198
Sony Financial Holdings, Inc.		2,600		41,691
T&D Holdings, Inc.		8,700		103,846
The Dai-ichi Life Insurance Co., Ltd.		13,100		181,524
Tokio Marine Holdings, Inc.		11,000		324,125
				973,579
Materials 0.5%
Air Water, Inc.		2,278		31,963
Asahi Kasei Corp.		351,463		2,389,526
Daicel Corp.		5,000		41,874
Daido Steel Co., Ltd.		4,373		21,381
Hitachi Chemical Co., Ltd.		1,600		23,539
Hitachi Metals Ltd.		3,000		40,738
JFE Holdings, Inc.		7,300		134,913
JSR Corp.		2,700		44,245
Kaneka Corp.		4,337		25,438
Kansai Paint Co., Ltd.		3,373		47,157
Kobe Steel Ltd.		47,000		61,695
Kuraray Co., Ltd.		5,200		58,468
Kureha Corp.		1,073,000		5,074,107
Maruichi Steel Tube Ltd.		700		17,756
Mitsubishi Chemical Holdings Corp.		20,500		82,042
Mitsubishi Gas Chemical Co., Inc.		6,000		34,641
Mitsubishi Materials Corp.		17,000		49,309
Mitsui Chemicals, Inc.		12,000		29,241
Nippon Kayaku Co., Ltd.		49,000		583,102
Nippon Paint Co., Ltd.		3,000		46,414
Nippon Steel & Sumitomo Metal Corp.		120,000		314,837
Nitto Denko Corp.		2,500		108,240
Oji Holdings Corp.		13,000		54,619
Shin-Etsu Chemical Co., Ltd.		6,424		376,845
Showa Denko K.K.		22,000		29,314
Sumitomo Chemical Co., Ltd.		24,000		90,039
Sumitomo Metal Mining Co., Ltd.		8,000		120,836
Taiheiyo Cement Corp.		20,000		70,158
Taiyo Nippon Sanso Corp.		4,000		31,883
Teijin Ltd.		14,000		34,413
Toray Industries, Inc.		23,000		150,116
Toyo Seikan Group Holdings Ltd.		2,300		34,205
Ube Industries Ltd.		15,000		25,413
Yamato Kogyo Co., Ltd.		600		17,303
				10,295,770
Media 0.0%
Dentsu, Inc.		3,600		147,646
Hakuhodo DY Holdings, Inc.		3,500		27,150
Toho Co., Ltd.		1,700		32,729
				207,525
Pharmaceuticals, Biotechnology & Life Sciences 0.2%
Astellas Pharma, Inc.		295,500		3,294,673
Chugai Pharmaceutical Co., Ltd.		3,400		85,812
Daiichi Sankyo Co., Ltd.		10,500		176,130
Dainippon Sumitomo Pharma Co., Ltd.		2,400		36,398
Eisai Co., Ltd.		3,800		146,752
Hisamitsu Pharmaceutical Co., Inc.		900		37,667
Kyowa Hakko Kirin Co., Ltd.		4,000		45,551
Mitsubishi Tanabe Pharma Corp.		3,400		46,622
Ono Pharmaceutical Co., Ltd.		1,300		103,108
Otsuka Holdings Co., Ltd.		5,900		169,966
Santen Pharmaceutical Co., Ltd.		1,100		49,027
Shionogi & Co., Ltd.		4,500		78,878
Taisho Pharmaceutical Holdings Co., Ltd.		600		44,224
Takeda Pharmaceutical Co., Ltd.		12,200		548,757
Tsumura & Co.		900		21,392
				4,884,957
Real Estate 0.2%
Aeon Mall Co., Ltd.		2,100		50,068
Daito Trust Construction Co., Ltd.		14,400		1,465,356
Daiwa House Industry Co., Ltd.		9,000		152,061
Hulic Co., Ltd.		3,700		44,628
Japan Prime Realty Investment Corp.		11		38,709
Japan Real Estate Investment Corp.		18		95,428

42 See financial notes

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Japan Retail Fund Investment Corp.		34		68,385
Mitsubishi Estate Co., Ltd.		20,255		459,594
Mitsui Fudosan Co., Ltd.		13,000		384,822
Nippon Building Fund, Inc.		22		121,978
Nippon Prologis REIT, Inc.		20		42,356
Nomura Real Estate Holdings, Inc.		2,000		37,368
NTT Urban Development Corp.		1,700		14,952
Sumitomo Realty & Development Co., Ltd.		32,495		1,260,785
Tokyo Tatemono Co., Ltd.		8,000		63,798
Tokyu Fudosan Holdings Corp.		7,000		50,890
United Urban Investment Corp.		41		61,879
				4,413,057
Retailing 0.3%
ABC-Mart, Inc.		400		17,963
Don Quijote Holdings Co., Ltd.		800		42,194
Fast Retailing Co., Ltd.		800		248,591
Isetan Mitsukoshi Holdings Ltd.		5,600		69,687
J. Front Retailing Co., Ltd.		7,000		44,496
Marui Group Co., Ltd.		3,300		29,313
Nitori Holdings Co., Ltd.		22,500		1,032,044
Rakuten, Inc.		11,400		147,922
Sanrio Co., Ltd.		700		22,193
Seria Co., Ltd.		95,600		3,738,827
Shimamura Co., Ltd.		342		31,860
Start Today Co., Ltd.		43,100		903,224
Takashimaya Co., Ltd.		4,000		37,897
USS Co., Ltd.		3,300		48,101
Yamada Denki Co., Ltd.		14,200		52,461
				6,466,773
Semiconductors & Semiconductor Equipment 0.0%
Advantest Corp.		2,200		24,252
Rohm Co., Ltd.		1,500		71,733
Sumco Corp.		1,700		13,046
Tokyo Electron Ltd.		2,700		153,565
				262,596
Software & Services 0.4%
Dena Co., Ltd.		1,500		25,351
Dwango Co., Ltd.		110,200		3,074,192
F@N Communications, Inc.		277,400		4,667,008
Fujitsu Ltd.		29,000		170,527
Gree, Inc.		1,400		13,690
GungHo Online Entertainment, Inc.		4,000		22,754
Itochu Techno-Solutions Corp.		400		16,716
Kakaku.com, Inc.		2,000		28,533
Konami Corp.		1,400		31,926
Nexon Co., Ltd.		1,600		12,462
Nintendo Co., Ltd.		1,600		167,937
Nomura Research Institute Ltd.		1,500		43,496
NTT Data Corp.		1,900		73,408
Oracle Corp., Japan		600		27,651
Otsuka Corp.		5,946		703,885
SCSK Corp.		27,600		730,064
Trend Micro, Inc.		1,600		51,755
Yahoo Japan Corp.		21,800		95,233
				9,956,588
Technology Hardware & Equipment 1.8%
Brother Industries Ltd.		3,500		48,956
Canon, Inc.		441,660		13,839,395
Citizen Holdings Co., Ltd.		3,900		28,641
FUJIFILM Holdings Corp.		7,200		185,991
Hamamatsu Photonics K.K.		1,000		45,058
Hirose Electric Co., Ltd.		500		70,577
Hitachi High-Technologies Corp.		900		20,588
Hitachi Ltd.		76,000		541,799
Horiba Ltd.		87,300		3,017,642
Hoya Corp.		112,900		3,339,280
Ibiden Co., Ltd.		1,800		32,490
Japan Aviation Electronics Industry Ltd.		370,000		6,298,119
Keyence Corp.		10,000		3,857,615
Konica Minolta, Inc.		8,000		74,545
Kyocera Corp.		5,200		244,555
Murata Manufacturing Co., Ltd.		31,324		2,611,289
NEC Corp.		39,000		109,707
Nippon Electric Glass Co., Ltd.		6,000		29,352
Omron Corp.		52,100		1,845,089
Ricoh Co., Ltd.		10,000		115,231
Seiko Epson Corp.		198,300		5,411,605
Shimadzu Corp.		4,000		34,170
TDK Corp.		1,900		81,019
Yaskawa Electric Corp.		3,321		37,447
Yokogawa Electric Corp.		3,200		43,750
				41,963,910
Telecommunication Services 0.1%
KDDI Corp.		8,500		453,319
Nippon Telegraph & Telephone Corp.		5,900		327,407
NTT DOCOMO, Inc.		23,700		378,028
SoftBank Corp.		15,000		1,117,170
				2,275,924
Transportation 0.1%
ANA Holdings, Inc.		19,000		41,491
Central Japan Railway Co.		2,200		270,217
East Japan Railway Co.		5,238		382,192
Hankyu Hanshin Holdings, Inc.		17,000		93,170
Japan Airlines Co., Ltd.		900		46,592
Kamigumi Co., Ltd.		4,000		38,129
Keikyu Corp.		7,000		58,104
Keio Corp.		9,000		63,698
Keisei Electric Railway Co., Ltd.		4,266		37,127
Kintetsu Corp.		30,000		105,428
Mitsubishi Logistics Corp.		2,000		28,694
Mitsui O.S.K. Lines, Ltd.		17,000		56,713
Nippon Express Co., Ltd.		13,000		61,455
Nippon Yusen K.K.		27,000		73,184
Odakyu Electric Railway Co., Ltd.		10,000		87,793
Tobu Railway Co., Ltd.		16,000		78,256
Tokyu Corp.		17,000		107,070
West Japan Railway Co.		2,700		109,493
Yamato Holdings Co., Ltd.		6,000		123,469
				1,862,275
Utilities 0.0%
Chubu Electric Power Co., Inc. *		9,931		113,120
Electric Power Development Co., Ltd.		1,900		50,385
Hokkaido Electric Power Co., Inc. *		2,700		16,517
Hokuriku Electric Power Co.		2,500		31,047
Kyushu Electric Power Co., Inc. *		6,400		64,573

See financial notes 43

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Osaka Gas Co., Ltd.		30,000		113,079
Shikoku Electric Power Co., Inc. *		2,700		31,604
The Chugoku Electric Power Co., Inc.		4,500		58,963
The Kansai Electric Power Co., Inc. *		11,700		98,106
Toho Gas Co., Ltd.		6,330		31,058
Tohoku Electric Power Co., Inc.		6,800		64,714
Tokyo Electric Power Co., Inc. *		21,700		82,075
Tokyo Gas Co., Ltd.		37,000		193,858
				949,099
				266,857,274
Luxembourg 0.0%
Energy 0.0%
Subsea 7 S.A.		4,220		84,503
Materials 0.0%
ArcelorMittal		15,267		248,260
Media 0.0%
RTL Group S.A. *		650		72,377
SES S.A.		4,895		184,344
				256,721
Telecommunication Services 0.0%
Millicom International Cellular S.A. SDR		976		96,736
				686,220
Netherlands 2.5%
Capital Goods 1.6%
Airbus Group N.V.		9,176		630,759
CNH Industrial N.V.		1,244,540		14,537,679
Koninklijke Boskalis Westminster N.V.		268,947		15,243,024
Koninklijke Philips N.V.		208,415		6,672,021
OCI *		1,395		59,657
				37,143,140
Commercial & Professional Supplies 0.0%
Randstad Holding N.V.		2,034		118,866
Diversified Financials 0.1%
ING Groep N.V. CVA *		59,758		854,232
Energy 0.0%
Fugro N.V. CVA		1,037		68,716
Koninklijke Vopak N.V.		1,054		52,554
				121,270
Food & Staples Retailing 0.1%
Koninklijke Ahold N.V.		137,086		2,650,132
Food, Beverage & Tobacco 0.4%
Heineken Holding N.V.		125,159		7,999,115
Heineken N.V.		3,567		247,755
Unilever N.V. CVA		25,519		1,094,283
				9,341,153
Insurance 0.0%
Aegon N.V.		28,864		264,579
Delta Lloyd N.V.		3,129		82,349
				346,928
Materials 0.1%
Akzo Nobel N.V.		29,418		2,267,012
James Hardie Industries plc CDI		6,557		84,180
Koninklijke DSM N.V.		2,431		174,565
				2,525,757
Media 0.0%
Reed Elsevier N.V.		10,856		221,580
Wolters Kluwer N.V.		4,864		135,589
				357,169
Real Estate 0.0%
Corio N.V.		1,077		50,466
Semiconductors & Semiconductor Equipment 0.2%
ASML Holding N.V.		5,655		461,528
NXP Semiconductor N.V. *		78,368		4,672,300
				5,133,828
Software & Services 0.0%
Gemalto N.V.		1,284		143,558
Telecommunication Services 0.0%
Koninklijke (Royal) KPN N.V. *		51,294		182,241
Ziggo N.V.		2,466		107,080
				289,321
Transportation 0.0%
TNT Express N.V.		7,388		66,577
				59,142,397
New Zealand 0.5%
Consumer Services 0.2%
SKYCITY Entertainment Group Ltd.		1,214,874		4,436,212
Health Care Equipment & Services 0.0%
Ryman Healthcare Ltd.		106,421		794,979
Materials 0.0%
Fletcher Building Ltd.		10,175		86,521
Telecommunication Services 0.0%
Telecom Corp. of New Zealand Ltd.		28,860		68,946
Transportation 0.3%
Auckland International Airport Ltd.		1,906,052		6,528,077
Utilities 0.0%
Contact Energy Ltd.		5,211		25,596
				11,940,331
Nigeria 0.0%
Banks 0.0%
Guaranty Trust Bank plc GDR - Reg’d		60,102		504,857
Norway 0.2%
Banks 0.0%
DNB A.S.A.		15,192		269,286
Energy 0.1%
Aker Solutions A.S.A.		2,465		39,495
Farstad Shipping A.S.A. (b)		94,566		1,948,814
Seadrill Ltd.		6,042		211,414

44 See financial notes

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number			Value
Security	of Shares			($)
Statoil A.S.A.		17,457			532,184
					2,731,907
Food, Beverage & Tobacco 0.0%
Orkla A.S.A.		11,571			95,699
Insurance 0.1%
Gjensidige Forsikring A.S.A.		38,492			709,709
Materials 0.0%
Norsk Hydro A.S.A.		20,042			107,489
Yara International A.S.A.		2,941			139,026
					246,515
Telecommunication Services 0.0%
Telenor A.S.A.		10,562			248,175
					4,301,291
Peru 0.1%
Banks 0.1%
Credicorp Ltd.		13,111			1,956,817
Poland 0.1%
Banks 0.1%
Powszechna Kasa Oszczednosci Bank Polski S.A.		180,908			2,482,669
Portugal 0.4%
Banks 0.0%
Banco Espirito Santo, S.A. - Reg’d *		30,126			53,399
Energy 0.0%
Galp Energia, SGPS, S.A.		6,040			104,686
Food & Staples Retailing 0.4%
Jeronimo Martins, SGPS, S.A.		4,439			77,635
Sonae		4,158,110			7,822,461
					7,900,096
Telecommunication Services 0.0%
Portugal Telecom, SGPS, S.A. - Reg’d		10,082			41,888
Utilities 0.0%
EDP - Energias de Portugal S.A.		32,603			158,374
					8,258,443
Republic of Korea 1.8%
Consumer Durables & Apparel 0.3%
Coway Co., Ltd.		11,027			871,591
Hanssem Co., Ltd.		86,500			7,077,138
					7,948,729
Consumer Services 0.3%
Hotel Shilla Co., Ltd.		71,520			6,022,795
Household & Personal Products 0.1%
Cosmax, Inc. *		45,490			3,059,668
Retailing 0.2%
Kolao Holdings		152,100			3,788,477
Semiconductors & Semiconductor Equipment 0.8%
Samsung Electronics Co., Ltd.		10,451			13,627,689
Seoul Semiconductor Co., Ltd.		155,520			6,260,046
					19,887,735
Software & Services 0.1%
NAVER Corp.		1,708			1,229,959
					41,937,363
Russia 0.0%
Software & Services 0.0%
Mail.ru Group Ltd. GDR *		32,486			884,809
Singapore 3.1%
			��
Banks 0.1%
DBS Group Holdings Ltd.		26,316			356,507
Oversea-Chinese Banking Corp., Ltd.		40,000			308,487
United Overseas Bank Ltd.		20,000			348,103
					1,013,097
Capital Goods 0.0%
Keppel Corp., Ltd.		22,000			185,109
Sembcorp Industries Ltd.		15,000			64,397
Sembcorp Marine Ltd.		13,000			42,279
Singapore Technologies Engineering Ltd.		194,000			592,543
Yangzijiang Shipbuilding Holdings Ltd.		29,000			25,504
					909,832
Consumer Services 0.0%
Genting Singapore plc		96,000			101,722
Diversified Financials 0.0%
Singapore Exchange Ltd.		13,000			71,893
Energy 0.5%
Ezion Holdings Ltd.		4,380,200			7,962,548
Ezra Holdings Ltd.		5,292,000			4,444,947
					12,407,495
Food & Staples Retailing 0.0%
Olam International Ltd.		22,000			39,257
Food, Beverage & Tobacco 0.0%
Golden Agri-Resources Ltd.		117,000			57,077
Wilmar International Ltd.		29,000			78,816
					135,893
Media 0.0%
Singapore Press Holdings Ltd.		26,000			86,944
Real Estate 1.0%
Ascendas REIT		4,825,000			8,831,501
CapitaCommercial Trust		30,000			38,392
CapitaLand Ltd.		38,000			97,252
CapitaMall Trust		7,972,200			12,707,987
CapitaMalls Asia Ltd.		20,000			35,242
City Developments Ltd.		8,000			69,312
Global Logistic Properties Ltd.		45,000			102,559
Keppel Land Ltd.		11,000			30,431
UOL Group Ltd.		7,000			35,940
					21,948,616
Retailing 0.2%
Jardine Cycle & Carriage Ltd.		2,000			74,992

See financial notes 45

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
OSIM International Ltd.		1,996,000		4,624,523
				4,699,515
Telecommunication Services 0.3%
Singapore Telecommunications Ltd.		127,000		387,990
StarHub Ltd.		2,099,000		6,962,961
				7,350,951
Transportation 0.8%
ComfortDelGro Corp., Ltd.		28,000		47,483
Hutchison Port Holdings Trust, Class U		78,000		53,084
SATS Ltd.		3,321,000		8,407,235
SIA Engineering Co., Ltd. (b)		2,691,000		10,290,515
Singapore Airlines Ltd.		8,331		69,068
				18,867,385
Utilities 0.2%
Hyflux Ltd.		3,825,000		3,662,347
				71,294,947
South Africa 0.1%
Capital Goods 0.1%
Bidvest Group Ltd.		69,594		1,910,901
Diversified Financials 0.0%
Coronation Fund Managers Ltd.		94,251		910,136
				2,821,037
Spain 1.7%
Banks 0.6%
Banco Bilbao Vizcaya Argentaria S.A.		497,498		6,128,049
Banco de Sabadell S.A.		55,185		187,755
Banco Popular Espanol S.A.		25,385		187,060
Banco Santander S.A.		181,268		1,802,831
Bankia S.A. *		63,568		129,845
Bankinter S.A.		202,491		1,550,365
CaixaBank S.A.		28,306		172,518
Liberbank S.A. *		2,523,190		3,149,721
				13,308,144
Capital Goods 0.0%
ACS, Actividades de Construccion y Servicios S.A.		2,901		124,524
Ferrovial S.A.		6,557		145,751
Zardoya Otis S.A.		2,289		40,156
				310,431
Commercial & Professional Supplies 0.2%
Prosegur Cia de Seguridad S.A. - Reg’d		679,458		4,549,636
Consumer Services 0.2%
Melia Hotels International S.A.		437,520		5,534,645
Energy 0.2%
Repsol S.A.		186,659		5,025,691
Food & Staples Retailing 0.0%
Distribuidora Internacional de Alimentacion S.A.		8,853		79,194
Insurance 0.0%
Mapfre S.A.		238,187		1,004,554
Pharmaceuticals, Biotechnology & Life Sciences 0.1%
Grifols S.A.		29,685		1,586,884
Retailing 0.1%
Inditex S.A.		8,715		1,309,402
Software & Services 0.1%
Amadeus IT Holding S.A., A Shares		65,734		2,733,910
Telecommunication Services 0.1%
Telefonica S.A.		64,456		1,081,708
Transportation 0.1%
Abertis Infraestructuras S.A.		69,725		1,569,479
International Consolidated Airlines Group S.A. *		15,698		107,422
				1,676,901
Utilities 0.0%
Enagas S.A.		3,153		97,140
Gas Natural SDG S.A.		5,670		162,587
Iberdrola S.A.		77,645		542,392
Red Electrica Corp. S.A.		1,623		133,599
				935,718
				39,136,818
Sweden 3.0%
Banks 0.1%
Nordea Bank AB		47,715		691,419
Skandinaviska Enskilda Banken AB, A Shares		24,515		338,624
Svenska Handelsbanken AB, A Shares		7,786		391,635
Swedbank AB, A Shares		14,311		382,990
				1,804,668
Capital Goods 1.3%
Alfa Laval AB		5,063		134,895
Assa Abloy AB, B Shares		5,318		282,250
Atlas Copco AB, A Shares		189,439		5,509,418
Atlas Copco AB, B Shares		212,350		5,791,905
Haldex AB		488,880		6,270,907
Indutrade AB		63,220		2,751,123
Sandvik AB		17,264		245,355
Scania AB, B Shares		5,191		158,151
Skanska AB, B Shares		5,997		137,687
SKF AB, B Shares		323,516		8,401,094
Volvo AB, B Shares		24,158		382,521
				30,065,306
Commercial & Professional Supplies 0.3%
AF AB, B Shares		168,963		6,136,164
Intrum Justitia AB		25,359		735,192
Securitas AB, B Shares		4,695		56,756
				6,928,112
Consumer Durables & Apparel 0.0%
Electrolux AB, B Shares		3,606		100,231
Husqvarna AB, B Shares		6,685		55,817
				156,048

46 See financial notes

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Diversified Financials 0.2%
Avanza Bank Holding AB		95,960		3,602,605
Industrivarden AB, C Shares		1,765		37,086
Investment AB Kinnevik, B Shares		3,776		133,245
Investor AB, B Shares		7,103		275,140
				4,048,076
Energy 0.0%
Lundin Petroleum AB *		3,337		71,633
Food, Beverage & Tobacco 0.3%
AarhusKarlshamn AB		67,290		4,505,956
Cloetta AB, B Shares *		864,180		2,854,733
Swedish Match AB		3,051		104,670
				7,465,359
Health Care Equipment & Services 0.0%
Elekta AB, B Shares		5,993		83,636
Getinge AB, B Shares		3,001		87,956
				171,592
Household & Personal Products 0.0%
Svenska Cellulosa AB, S.C.A., B Shares		9,015		253,439
Materials 0.4%
Boliden AB		4,101		62,632
Hexpol AB		86,310		8,177,764
				8,240,396
Retailing 0.4%
Clas Ohlson AB, B Shares		65,980		1,463,434
Hennes & Mauritz AB, B Shares		208,663		8,541,182
				10,004,616
Technology Hardware & Equipment 0.0%
Hexagon AB, B Shares		3,800		121,660
Telefonaktiebolaget LM Ericsson, B Shares		48,039		579,276
				700,936
Telecommunication Services 0.0%
Tele2 AB, B Shares		4,754		60,752
TeliaSonera AB		36,468		265,452
				326,204
				70,236,385
Switzerland 7.0%
Capital Goods 0.6%
ABB Ltd. - Reg’d *		34,632		833,803
Burckhardt Compression Holding AG		15,161		7,858,215
Geberit AG - Reg’d		8,566		2,860,959
Schindler Holding AG		21,320		3,303,108
Schindler Holding AG - Reg’d		323		49,303
Sulzer AG - Reg’d		360		55,549
				14,960,937
Commercial & Professional Supplies 0.2%
Adecco S.A. - Reg’d *		59,687		5,010,846
SGS S.A. - Reg’d		86		214,836
				5,225,682
Consumer Durables & Apparel 0.7%
Cie Financiere Richemont S.A.		149,229		15,182,559
The Swatch Group AG - Bearer Shares		479		308,016
The Swatch Group AG - Reg’d		651		78,550
				15,569,125
Diversified Financials 1.8%
Cembra Money Bank AG *		86,430		6,005,221
Credit Suisse Group AG - Reg’d *		809,042		25,648,761
Julius Baer Group Ltd. *		3,591		168,204
Leonteq AG *		25,270		4,817,982
Pargesa Holding S.A.		405		36,761
Partners Group Holding AG		12,025		3,292,653
UBS AG - Reg’d *		57,116		1,194,516
				41,164,098
Energy 0.0%
Transocean Ltd.		5,774		246,659
Food, Beverage & Tobacco 0.6%
Aryzta AG *		1,308		120,906
Barry Callebaut AG - Reg’d *		38		51,644
Coca-Cola HBC AG CDI *		3,294		83,478
Lindt & Spruengli AG		15		72,946
Lindt & Spruengli AG - Reg’d		2		116,646
Nestle S.A. - Reg’d		174,361		13,475,362
				13,920,982
Health Care Equipment & Services 0.1%
Sonova Holding AG - Reg’d *		10,829		1,564,408
Straumann Holding AG - Reg’d		3,876		860,126
				2,424,534
Insurance 0.1%
Baloise Holding AG - Reg’d		712		86,703
Swiss Life Holding AG - Reg’d *		523		128,854
Swiss Re AG *		5,505		481,363
Zurich Insurance Group AG *		2,338		670,442
				1,367,362
Materials 1.2%
Clariant AG - Reg’d *		125,381		2,472,501
EMS-Chemie Holding AG - Reg’d		124		48,385
Givaudan S.A. - Reg’d *		2,802		4,422,045
Glencore Xstrata plc		1,435,694		7,746,666
Holcim Ltd. - Reg’d *		123,036		11,284,420
Sika AG		356		1,440,446
Syngenta AG - Reg’d		1,451		574,584
				27,989,047
Pharmaceuticals, Biotechnology & Life Sciences 1.0%
Actelion Ltd. - Reg’d *		24,071		2,369,877
Lonza Group AG - Reg’d *		754		78,914
Novartis AG - Reg’d		74,380		6,466,039
Roche Holding AG		38,756		11,368,921
Tecan Group AG - Reg’d		21,640		2,706,430
				22,990,181
Real Estate 0.0%
Swiss Prime Site AG - Reg’d *		883		74,226
Semiconductors & Semiconductor Equipment 0.2%
ams AG		22,740		3,428,566
Telecommunication Services 0.0%
Swisscom AG - Reg’d		365		222,058

See financial notes 47

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Transportation 0.5%
Kuehne & Nagel International AG - Reg’d		89,510		12,239,667
				161,823,124
Taiwan 1.3%
Capital Goods 0.2%
Airtac International Group		388,410		4,177,557
Consumer Durables & Apparel 0.5%
Eclat Textile Co., Ltd.		237,860		2,607,947
Makalot Industrial Co., Ltd.		1,556,000		8,182,311
				10,790,258
Semiconductors & Semiconductor Equipment 0.5%
Everlight Electronics Co., Ltd.		2,230,000		5,225,739
MediaTek, Inc.		165,000		2,585,547
Taiwan Semiconductor Manufacturing Co., Ltd. ADR		255,138		5,128,274
				12,939,560
Technology Hardware & Equipment 0.1%
Delta Electronics, Inc.		414,000		2,541,825
				30,449,200
Thailand 0.0%
Transportation 0.0%
Airports of Thailand PCL		132,400		797,837
United Arab Emirates 0.2%
Banks 0.1%
Dubai Islamic Bank PJSC		599,252		1,109,267
Real Estate 0.1%
Emaar Properties PJSC		826,979		2,459,267
				3,568,534
United Kingdom 18.7%
Automobiles & Components 0.0%
GKN plc		26,398		171,613
Banks 1.2%
Barclays plc		237,981		1,016,189
HSBC Holdings plc (f)		140,137		1,433,025
HSBC Holdings plc (f)		294,066		3,004,652
Lloyds Banking Group plc *		16,448,250		20,975,013
Royal Bank of Scotland Group plc *		34,458		174,580
Standard Chartered plc		38,070		824,491
				27,427,950
Capital Goods 4.0%
Wolseley plc		20,550		1,190,756
Ashtead Group plc		172,740		2,559,347
BAE Systems plc		51,156		346,094
Bodycote plc		1,048,787		12,941,511
Bunzl plc		143,465		4,087,568
Cobham plc		16,559		86,386
Diploma plc (b)		601,096		6,708,372
Fenner plc		627,954		4,393,481
Grafton Group plc		540,210		5,313,471
HellermannTyton Group plc		1,156,443		6,161,570
IMI plc		141,119		3,579,139
Interserve plc		621,663		6,967,054
Keller Group plc		251,190		4,237,846
Meggitt plc		11,655		94,010
Melrose Industries plc		15,664		75,643
Rolls-Royce Holdings plc *		56,459		1,002,852
Rotork plc		320,678		14,063,769
Smiths Group plc		270,531		6,106,883
Spirax-Sarco Engineering plc		156,829		7,687,944
The Weir Group plc		3,386		154,019
Travis Perkins plc		28,406		820,091
Ultra Electronics Holdings plc		178,786		5,126,565
				93,704,371
Commercial & Professional Supplies 1.2%
Aggreko plc		4,162		111,081
Babcock International Group plc		166,486		3,360,347
Berendsen plc		47,719		833,935
Capita plc		258,720		4,744,260
De La Rue plc		542,942		7,523,633
G4S plc		26,746		106,783
Hays plc		346,326		883,546
Intertek Group plc		2,390		117,729
Regus plc		1,792,820		6,339,719
Serco Group plc		539,478		3,097,815
				27,118,848
Consumer Durables & Apparel 0.5%
Bellway plc		424,740		10,343,575
Berkeley Group Holdings plc		28,089		1,089,900
Burberry Group plc		6,834		171,631
Persimmon plc *		5,320		118,061
				11,723,167
Consumer Services 0.9%
Carnival plc		2,747		109,822
Compass Group plc		274,231		4,368,210
Greene King plc		400,266		6,026,075
InterContinental Hotels Group plc		43,109		1,473,315
The Restaurant Group plc		493,980		5,215,892
TUI Travel plc		7,543		54,560
Whitbread plc		45,956		3,169,859
William Hill plc		15,048		90,168
				20,507,901
Diversified Financials 0.9%
3i Group plc		14,557		93,506
Aberdeen Asset Management plc		14,467		107,004
Close Brothers Group plc		411,520		9,720,615
Hargreaves Lansdown plc		47,497		940,236
ICAP plc		8,336		58,393
IG Group Holdings plc		68,501		736,632
Investec plc		9,673		85,352
Jupiter Fund Management plc		98,209		645,351
London Stock Exchange Group plc		2,950		90,407
Plus500 Ltd.		123,400		1,200,302
Provident Financial plc		30,292		1,018,482
Schroders plc		166,691		7,208,708
Schroders plc, Non Voting Shares		1,100		36,242
				21,941,230

48 See financial notes

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Energy 0.5%
AMEC plc		4,981		104,029
BG Group plc		148,162		2,997,215
BP plc		291,157		2,458,271
Genel Energy plc *		75,425		1,234,965
Petrofac Ltd.		3,837		94,131
Royal Dutch Shell plc, A Shares		60,291		2,383,556
Royal Dutch Shell plc, B Shares		38,784		1,646,807
Tullow Oil plc		14,089		209,578
				11,128,552
Food & Staples Retailing 0.6%
J. Sainsbury plc		18,131		102,853
Tesco plc		2,848,678		14,112,138
WM Morrison Supermarkets plc		34,299		116,434
				14,331,425
Food, Beverage & Tobacco 0.9%
Associated British Foods plc		5,619		282,133
British American Tobacco plc		29,533		1,705,381
Diageo plc		502,581		15,398,979
Imperial Tobacco Group plc		15,069		651,197
SABMiller plc		15,113		822,918
Stock Spirits Group plc *		297,820		1,466,039
Tate & Lyle plc		7,497		88,874
Unilever plc		20,213		904,189
				21,319,710
Health Care Equipment & Services 0.0%
Smith & Nephew plc		13,959		217,665
Household & Personal Products 0.2%
Reckitt Benckiser Group plc		56,734		4,579,906
Insurance 1.1%
Admiral Group plc		3,040		71,791
Amlin plc		274,977		2,079,013
Aviva plc		46,758		416,697
Direct Line Insurance Group plc		16,626		70,338
Hiscox Ltd.		113,215		1,349,534
Legal & General Group plc		91,272		326,730
Old Mutual plc		75,509		255,227
Prudential plc		478,591		11,002,379
Resolution Ltd.		21,377		107,844
RSA Insurance Group plc		82,487		136,694
St. James’s Place plc		53,991		703,647
Standard Life plc		36,765		237,685
Willis Group Holdings plc		232,000		9,509,680
				26,267,259
Materials 2.0%
Anglo American plc		21,690		579,841
Antofagasta plc		5,862		78,124
AZ Electronic Materials S.A. (b)		1,743,732		11,869,603
BHP Billiton plc		33,076		1,073,791
Croda International plc		373,159		16,252,749
DS Smith plc		140,159		746,914
Fresnillo plc		2,689		38,775
Johnson Matthey plc		3,228		178,573
Randgold Resources Ltd.		1,346		108,196
Rexam plc		11,835		99,224
Rio Tinto plc		62,862		3,417,661
Victrex plc		352,754		11,106,533
				45,549,984
Media 0.5%
British Sky Broadcasting Group plc		16,255		241,515
Daily Mail & General Trust plc		52,389		722,137
ITV plc		2,253,508		6,932,015
Pearson plc		12,645		237,119
Reed Elsevier plc		18,961		279,630
WPP plc		170,295		3,671,831
				12,084,247
Pharmaceuticals, Biotechnology & Life Sciences 0.8%
AstraZeneca plc		19,739		1,558,090
BTG plc *		112,983		1,015,940
Clinigen Healthcare Ltd. *		156,666		1,283,558
GlaxoSmithKline plc		327,731		9,055,382
Hikma Pharmaceuticals plc		172,645		4,530,523
				17,443,493
Real Estate 0.5%
British Land Co., plc		14,802		172,931
Countrywide plc		1,045,712		10,443,401
Derwent London plc		16,494		758,766
Hammerson plc		10,685		103,122
Intu Properties plc		14,083		69,573
Land Securities Group plc		12,150		218,264
Segro plc		11,121		65,820
				11,831,877
Retailing 1.0%
ASOS plc *		798		57,829
Dixons Retail plc *		3,624,990		2,757,082
Howden Joinery Group plc		942,204		5,187,298
Kingfisher plc		36,805		260,446
Marks & Spencer Group plc		24,746		185,009
Next plc		37,274		4,112,136
Pets at Home Group plc *		1,017,110		3,825,258
Poundland Group plc *		1,139,440		6,685,308
				23,070,366
Semiconductors & Semiconductor Equipment 0.0%
ARM Holdings plc		21,623		327,268
Nanoco Group plc *		44,979		74,804
				402,072
Software & Services 0.0%
The Sage Group plc		18,865		136,082
Technology Hardware & Equipment 1.2%
Domino Printing Sciences plc (b)		589,965		7,727,552
Halma plc		740,732		7,037,518
Laird plc		1,083,597		5,092,659
Spectris plc		174,171		6,553,471
TT Electronics plc		681,447		2,410,412
				28,821,612
Telecommunication Services 0.4%
BT Group plc		1,217,647		7,601,336
Inmarsat plc		6,807		83,756
Vodafone Group plc		415,359		1,576,955
				9,262,047
Transportation 0.2%
easyJet plc		143,688		3,975,795
Royal Mail plc *		9,560		85,654
				4,061,449

See financial notes 49

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Utilities 0.1%
Centrica plc		81,198		452,844
National Grid plc		58,234		827,694
Severn Trent plc		3,562		110,960
SSE plc		14,882		383,755
United Utilities Group plc		10,763		144,773
				1,920,026
				435,022,852
Total Common Stock
(Cost $1,766,369,267)				2,209,885,346
Preferred Stock 0.4% of net assets
Brazil 0.2%
Banks 0.2%
Itau Unibanco Holding S.A.		257,600		4,251,454
Germany 0.2%
Automobiles & Components 0.0%
Bayerische Motoren Werke AG		783		77,184
Porsche Automobil Holding SE		2,393		264,654
Volkswagen AG		2,259		610,664
				952,502
Capital Goods 0.2%
Jungheinrich AG		56,830		4,230,346
Household & Personal Products 0.0%
Henkel AG & Co. KGaA		2,771		309,106
Materials 0.0%
Fuchs Petrolub SE		613		61,665
				5,553,619
United Kingdom 0.0%
Capital Goods 0.0%
Rolls-Royce Holdings plc *(a)		7,565,506		12,774
Total Preferred Stock
(Cost $8,755,457)				9,817,847
Other Investment Companies 3.9% of net assets
Equity Fund 0.1%
Market Vectors Junior Gold Miners ETF *		73,490		2,682,385
Money Market Fund 3.8%
State Street Institutional U.S. Government Money Market Fund, Institutional Class 0.00% (c)		87,445,224		87,445,224
Total Other Investment Companies
(Cost $90,531,621)				90,127,609
Rights 0.0% of net assets
Australia 0.0%
Banks 0.0%
Bank of Queensland Ltd. *(a)		511		717
Spain 0.0%
Banks 0.0%
Banco Santander S.A. *(a)		181,268		38,348
United Kingdom 0.0%
Commercial & Professional Supplies 0.0%
Babcock International Group plc *		64,032		432,446
Total Rights
(Cost $37,496)				471,511
Warrants 0.0% of net assets
Hong Kong 0.0%
Real Estate 0.0%
Sun Hung Kai Properties Ltd. *		2,083		1,403
Total Warrants
(Cost $—)				1,403
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 0.2% of net assets
U.S. Treasury Obligations 0.2%
U.S. Treasury Bills
0.05%, 06/19/14 (d)(e)		4,500,000		4,499,694
0.04%, 06/26/14 (d)(e)		45,000		44,997
0.06%, 06/26/14 (d)(e)		5,000		5,000
0.08%, 06/26/14 (d)(e)		100,000		99,988
Total Short-Term Investments
(Cost $4,649,679)				4,649,679
End of Investments.

At 04/30/14, the tax basis cost of the fund’s investments was $1,888,652,019 and the unrealized appreciation and depreciation were $462,519,204 and ($36,217,828), respectively, with a net unrealized appreciation of $426,301,376.

50 See financial notes

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

At 04/30/14, the values of certain foreign securities held by the fund aggregating $1,950,266,063 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(a) for additional information)

*	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 $48,148,507 or 2.1% of net assets.
(c)	The rate shown is the 7-day yield.
(d)	All or a portion of this security is held as collateral for open futures contracts.
(e)	The rate shown is the purchase yield.
(f)	Securities are traded on separate exchanges for the same entity.

ADR —	American Depositary Receipt
CDI —	CHESS Depositary Interest
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
GBP —	Great British pound
NZD —	New Zealand dollar
SEK —	Swedish krona
USD —	U.S. dollar
ZAR —	South African rand

In addition to the above, the fund held the following at 04/30/14:

			Contract		Unrealized
	Number of		Value		Appreciation
	Contracts		($)		($)
Futures Contracts
MSCI EAFE, e-mini, Long, expires 06/20/14		637		61,288,955		2,749,271

Amount of

Amount of

Unrealized

Currency

Currency

Currency

Currency

Appreciation

Expiration

to be

to be

to be

to be

(Depreciation)

Date

Counterparty

Received

Received

Delivered

Delivered

($)

Forward Foreign Currency Exchange Contracts

05/06/2014

State Street Bank & Trust Co.

GBP

489,500

USD

826,445

2,274

06/18/2014

State Street Bank & Trust Co.

SEK

11,700,000

USD

1,797,994

13,560

07/31/2014

State Street Bank London

USD

6,285,681

AUD

6,808,000

1,030

09/17/2014

State Street Bank & Trust Co.

USD

7,665,420

AUD

8,330,000

(334,187

)

09/17/2014

State Street Bank & Trust Co.

USD

868,686

AUD

944,000

3,947

12/17/2014

State Street Bank & Trust Co.

USD

33,065,068

CHF

29,040,000

295,070

07/31/2014

State Street Bank London

USD

5,713,694

NZD

6,677,500

(43,495

)

06/18/2014

State Street Bank & Trust Co.

USD

7,606,898

SEK

49,500,000

(55,641

)

06/18/2014

State Street Bank & Trust Co.

USD

983,518

SEK

6,400,000

8,761

05/02/2014

State Street Bank & Trust Co.

USD

126,217

ZAR

1,327,864

(986

)

Net Unrealized Depreciation on Forward Foreign Currency Exchange Contracts

(109,667

)

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2014 (see financial note 2(a) for additional information):

Assets Valuation Input

	Quoted Prices in				Significant
	Active Markets for		Other Significant		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Common Stock1		$—		$522,164,827		$—		$522,164,827
Australia1		—		94,156,491		—		94,156,491
Food & Staples Retailing		37,130		1,402,817		—		1,439,947
Transportation		—		372,848		154,420		527,268
Austria1		—		3,426,625		—		3,426,625
Real Estate		62,113		—		—		62,113
Belgium1		—		2,504,351		—		2,504,351
Media		49,114		—		—		49,114
Brazil1		14,376,989		—		—		14,376,989

See financial notes 51

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Quoted Prices in				Significant
	Active Markets for		Other Significant		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Canada
Automobiles & Components		$5,751,576		$—		$—		$5,751,576
Banks		5,624,966		—		—		5,624,966
Capital Goods		7,427,267		—		—		7,427,267
Commercial & Professional Supplies		9,320,045		—		—		9,320,045
Consumer Durables & Apparel		741,239		—		—		741,239
Diversified Financials		9,446,537		—		—		9,446,537
Energy		26,954,138		3,138,725		—		30,092,863
Food & Staples Retailing		1,831,502		—		—		1,831,502
Materials		12,967,970		—		—		12,967,970
Media		4,028,348		—		—		4,028,348
Real Estate		12,112,539		—		—		12,112,539
Transportation		6,524,168		—		—		6,524,168
China1		—		14,944,286		—		14,944,286
Pharmaceuticals, Biotechnology & Life Sciences		1,189,150		701,331		—		1,890,481
Retailing		927,497		—		—		927,497
Software & Services		7,978,044		1,750,286		—		9,728,330
Denmark1		—		51,423,332		—		51,423,332
Energy		4,146,011		—		—		4,146,011
Telecommunication Services		124,260		—		—		124,260
Finland1		—		23,833,617		—		23,833,617
Energy		39,464		—		—		39,464
Telecommunication Services		63,324		—		—		63,324
France1		—		121,014,881		—		121,014,881
Capital Goods		1,874,510		21,268,831		—		23,143,341
Energy		13,593,773		9,506,635		—		23,100,408
Food, Beverage & Tobacco		29,022		25,286,863		—		25,315,885
Health Care Equipment & Services		6,384,855		339,681		—		6,724,536
Pharmaceuticals, Biotechnology & Life Sciences		6,291,515		12,904,674		—		19,196,189
Software & Services		3,489,658		961,314		—		4,450,972
Telecommunication Services		116,031		985,196		—		1,101,227
Germany1		—		223,760,037		—		223,760,037
Media		3,358,183		3,397,771		—		6,755,954
Hong Kong1		—		46,217,209		—		46,217,209
Semiconductors & Semiconductor Equipment		2,692,864		3,819,243		—		6,512,107
Software & Services		4,593,104		—		—		4,593,104
Telecommunication Services		32,039		35,647		—		67,686
Ireland1		—		30,031,026		—		30,031,026
Food, Beverage & Tobacco		5,525,713		573,487		—		6,099,200
Israel1		—		906,746		—		906,746
Materials		6,062,794		78,927		—		6,141,721
Software & Services		5,657,779		38,864		—		5,696,643
Italy1		—		56,442,060		—		56,442,060
Technology Hardware & Equipment		4,295,109		—		—		4,295,109

52 See financial notes

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Quoted Prices in				Significant
	Active Markets for		Other Significant		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Luxembourg1		$—		$429,499		$—		$429,499
Media		184,344		72,377		—		256,721
Netherlands1		—		16,865,429		—		16,865,429
Capital Goods		59,657		37,083,483		—		37,143,140
Semiconductors & Semiconductor Equipment		4,672,300		461,528		—		5,133,828
Nigeria1		504,857		—		—		504,857
Norway1		—		859,675		—		859,675
Energy		1,948,814		783,093		—		2,731,907
Insurance		709,709		—		—		709,709
Peru1		1,956,817		—		—		1,956,817
Republic of Korea1		—		38,877,695		—		38,877,695
Household & Personal Products		3,059,668		—		—		3,059,668
Switzerland1		—		106,738,044		—		106,738,044
Diversified Financials		10,823,203		30,340,895		—		41,164,098
Food, Beverage & Tobacco		189,592		13,731,390		—		13,920,982
Taiwan1		—		17,509,640		—		17,509,640
Semiconductors & Semiconductor Equipment		5,128,274		7,811,286		—		12,939,560
Thailand1		797,837		—		—		797,837
United Kingdom1		—		274,934,500		—		274,934,500
Commercial & Professional Supplies		3,097,815		24,021,033		—		27,118,848
Energy		94,131		11,034,421		—		11,128,552
Insurance		10,995,908		15,271,351		—		26,267,259
Media		241,515		11,842,732		—		12,084,247
Pharmaceuticals, Biotechnology & Life Sciences		1,283,558		16,159,935		—		17,443,493
Real Estate		10,443,401		1,388,476		—		11,831,877
Retailing		10,510,566		12,559,800		—		23,070,366
Semiconductors & Semiconductor Equipment		74,804		327,268		—		402,072
Technology Hardware & Equipment		2,410,412		26,411,200		—		28,821,612
Utilities		110,960		1,809,066		—		1,920,026
Preferred Stock1		—		5,553,619		—		5,553,619
Brazil1		4,251,454		—		—		4,251,454
United Kingdom1		—		—		12,774		12,774
Other Investment Companies1		90,127,609		—		—		90,127,609
Rights
Australia1		—		—		717		717
Spain1		—		—		38,348		38,348
United Kingdom1		432,446		—		—		432,446
Warrants
Hong Kong1		1,403		—		—		1,403
Short-Term Investments1		—		4,649,679		—		4,649,679
Total		$359,831,394		$1,954,915,742		$206,259		$2,314,953,395
Other Financial Instruments
Futures Contracts2		$2,749,271		$—		$—		$2,749,271

See financial notes 53

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Quoted Prices in					Significant
	Active Markets for		Other Significant			Unobservable
	Identical Assets		Observable Inputs			Inputs
Description	(Level 1)		(Level 2)			(Level 3)		Total
Forward Foreign Currency Exchange Contracts2		$—		$324,642			$—		$324,642
Liabilities Valuation Input
Other Financial Instruments
Forward Foreign Currency Exchange Contracts2		$—		($434,309	)		$—		($434,309	)

1	As categorized in portfolio holdings.
2	Futures contracts and forward foreign currency exchange contracts are not included in Investments in the schedule of portfolio holdings 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		Appreciation			Gross		Gross			Transfers		Transfers		April 30,
Investments in Securities	2013		(Losses)		(Depreciation)			Purchases		Sales			in		out		2014
Common Stock
Australia		$—		$—		$1,183			$15,186		$—			$138,051		$—		$154,420
Hong Kong		12,251		—		(12,251	)		—		—			—		—		—
Japan		49,426		—		278			—		(49,704	)		—		—		—
Preferred Stock
United Kingdom		53,040		1,503		36			12,693		(54,498	)		—		—		12,774
Rights
Australia		—		—		717			—		—			—		—		717
Spain		37,011		—		(817	)		37,496		(35,342	)		—		—		38,348
Total		$151,728		$1,503		($10,854	)		$65,375		($139,544	)		$138,051		$—		$206,259

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 appreciation (depreciation) for Level 3 investments held by the fund at April 30, 2014 was ($5,679).

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, 2014. The transfers in the amount of $58,619,666 and $16,379,998 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.

54 See financial notes

 Laudus International MarketMasters Fund

Statement of

Assets and Liabilities

As of April 30, 2014; unaudited

Assets
Investments, at value (cost $1,870,343,520)		$2,314,953,395
Foreign currency, at value (cost $5,012,856)		5,032,562
Receivables:
Investments sold		15,858,891
Dividends		7,496,062
Fund shares sold		3,068,007
Foreign tax reclaims		1,404,587
Variation margin on futures contracts		231,096
Unrealized appreciation on forward foreign currency exchange contracts		324,642
Prepaid expenses	+	191,363
Total assets		2,348,560,605
Liabilities
Payables:
Investments bought		22,470,519
Investment adviser and administrator fees		207,196
Shareholder service fees		343,657
Independent trustees’ fees		28
Fund shares redeemed		3,154,632
Foreign capital gains tax		232,388
Unrealized depreciation on forward foreign currency exchange contracts	+	434,309
Total liabilities		26,842,729
Net Assets
Total assets		2,348,560,605
Total liabilities	−	26,842,729
Net assets		$2,321,717,876
Net Assets by Source
Capital received from investors		1,961,333,420
Distributions in excess of net investment income		(5,386,346	)
Net realized capital losses		(81,337,272	)
Net unrealized capital appreciation		447,108,074
Net Asset Value (NAV) by Shares Class

			Shares
Share Class	Net Assets	÷	Outstanding	=	NAV
Investor Shares	$684,192,286		28,265,524			$24.21
Select Shares	$1,637,525,590		67,694,474			$24.19

See financial notes 55

 Laudus International MarketMasters Fund

Statement of

Operations

For the period November 1, 2013 through April 30, 2014; unaudited

Investment Income
Dividends (net of foreign withholding taxes of $2,267,270)		$25,311,414
Interest	+	481
Total investment income		25,311,895
Expenses
Investment adviser and administrator fees		14,363,518
Shareholder service fees:
Investor Shares		788,717
Select Shares		613,657
Custodian fees		581,317
Portfolio accounting fees		98,681
Transfer agent fees		83,018
Shareholder reports		53,674
Registration fees		39,188
Professional fees		37,214
Independent trustees’ fees		8,697
Interest expense		542
Other expenses	+	30,816
Total expenses		16,699,039
Expense reduction by CSIM and its affiliates	−	1,994,693
Net expenses	−	14,704,346
Net investment income		10,607,549
Realized and Unrealized Gains (Losses)
Net realized gains on investments		155,419,901
Net realized gains on futures contracts		702,153
Net realized losses on foreign currency transactions	+	(172,015	)
Net realized gains		155,950,039
Net change in unrealized appreciation (depreciation) on investments (net of foreign capital gain tax of ($187,898))		(81,430,212	)
Net change in unrealized appreciation (depreciation) on futures contracts		117,186
Net change in unrealized appreciation (depreciation) on foreign currency translations	+	(744,208	)
Net change in unrealized appreciation (depreciation)	+	(82,057,234	)
Net realized and unrealized gains		73,892,805
Increase in net assets resulting from operations		$84,500,354

56 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

11/1/13-4/30/14				11/1/12-10/31/13
Net investment income		$10,607,549			$23,324,748
Net realized gains		155,950,039			173,495,399
Net change in unrealized appreciation (depreciation)	+	(82,057,234	)		265,189,677
Increase in net assets from operations		84,500,354			462,009,824
Distributions to Shareholders
Distributions from net investment income
Investor Shares		(9,151,462	)		(13,288,779	)
Select Shares	+	(24,452,646	)		(25,873,436	)
Total distributions from net investment income		($33,604,108	)		($39,162,215	)

Transactions in Fund Shares

		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		VALUE			SHARES		VALUE
Shares Sold
Investor Shares			1,467,437		$34,840,435			3,013,633		$63,900,921
Select Shares	+		8,253,707		195,268,429			19,866,078		424,219,097
Total shares sold			9,721,144		$230,108,864			22,879,711		$488,120,018
Shares Reinvested
Investor Shares			364,557		$8,395,762			634,180		$12,214,309
Select Shares	+		703,683		16,184,703			892,608		17,173,788
Total shares reinvested			1,068,240		$24,580,465			1,526,788		$29,388,097
Shares Redeemed
Investor Shares			(2,068,028	)	($48,962,912	)		(6,234,658	)	($130,752,070	)
Select Shares	+		(8,410,871	)	(200,020,871	)		(9,414,179	)	(198,148,130	)
Total shares redeemed			(10,478,899	)	($248,983,783	)		(15,648,837	)	($328,900,200	)
Net transactions in fund shares			310,485		$5,705,546			8,757,662		$188,607,915
Shares Outstanding and Net Assets
		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			95,649,513		$2,265,116,084			86,891,851		$1,653,660,560
Total increase	+		310,485		56,601,792			8,757,662		611,455,524
End of period			95,959,998		$2,321,717,876			95,649,513		$2,265,116,084
Distributions in excess of net investment income/Net investment income not yet distributed					($5,386,346	)				$17,610,213

See financial notes 57

 Laudus MarketMasters Funds

Financial Notes, unaudited

1. Business Structure of the Funds:

Each of the funds 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”).

For more information about the underlying funds’ operations and policies, please refer to those funds’ semiannual and annual reports, which are filed with the U.S. Securities and 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:

•  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.

58 

 Laudus MarketMasters Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

•  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 NAV 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 contracts (“futures”) and forward foreign currency exchange contracts (“forwards”): Futures are valued at their settlement prices as of the close of their exchanges. Forwards are valued based on that day’s forward exchange rates or by using an interpolated forward exchange rate for contracts with interim settlement dates.

•  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 NAVs. Exchange traded 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, ETFs and futures contracts. Investments in mutual funds are valued daily at their NAVs, and investments in ETFs are valued daily at the last reported sale price or the official closing price, 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

59

 Laudus MarketMasters Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

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, 2014 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 a 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 appreciation or depreciation 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 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 appreciation or depreciation 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 and losses from security transactions are based on the identified costs of the securities involved.

Assets and liabilities denominated in foreign currencies are reported in U.S. dollars. For assets and liabilities held on a given date, the dollar value is based on market exchange rates in effect on that date. Transactions involving foreign currencies, including purchases, sales, income receipts and expense payments, are 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.

60 

 Laudus MarketMasters Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

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 forward 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. Any distributions from underlying funds are recorded in accordance with the character of the distributions as designated by the underlying funds.

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, 2014, if any, are reflected in the funds’ Statements of Assets and Liabilities.

61

 Laudus MarketMasters 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.

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.

Market Risk. 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.

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.

Investment Style Risk. The funds’ 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.

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 - a fund’s performance also will lag those investments.

Large-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 - bonds and small-cap stocks, for instance - a fund’s performance also will lag those investments.

Management Risk. As with all actively managed funds, the investment strategies of each fund’s managers — its investment adviser and investment sub-advisers — may not achieve their desired results.

Foreign Investment Risk. 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); the imposition of economic sanctions or other government restrictions; differing accounting, auditing, financial reporting and legal standards and practices; differing securities market structures; and higher transaction costs. These risks may negatively impact the value or liquidity of a fund’s investments, and could impair the fund’s ability to meet its investment objective or invest in accordance with its investment strategies.

Emerging Market 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 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, and at times, it may be difficult to value such investments.

Currency Risk. As a result of a 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.

Derivatives Risk. 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

62 

 Laudus MarketMasters Funds

Financial Notes, unaudited (continued)

3. Risk Factors (continued):

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 a 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.

Liquidity Risk. 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). 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%

63

 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 shares of each fund in this report that are owned by other Schwab funds as of April 30, 2014, as applicable:

	Underlying Funds
	Laudus Small-Cap		Laudus International
	MarketMasters Fund		MarketMasters Fund
Schwab Target 2010 Fund		0.4%		0.1%
Schwab Target 2015 Fund		0.8%		0.2%
Schwab Target 2020 Fund		5.3%		0.9%
Schwab Target 2025 Fund		4.4%		0.7%
Schwab Target 2030 Fund		11.8%		1.8%
Schwab Target 2035 Fund		4.9%		0.7%
Schwab Target 2040 Fund		15.8%		2.2%
Schwab Target 2045 Fund		0.7%		0.1%
Schwab Target 2050 Fund		0.6%		0.1%
Schwab Target 2055 Fund		0.3%		0.0%	*
Schwab Monthly Income Fund - Moderate Payout		—%		0.3%
Schwab Monthly Income Fund - Enhanced Payout		—%		0.4%
Schwab Monthly Income Fund - Maximum Payout		—%		0.1%
Schwab Balanced Fund		10.6%		—%

* Less than 0.1%

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 CSIM 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.

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 on the funds’ Statement of Operations, if any. The interest expense is determined based on a negotiated rate above the current Federal Funds Rate.

64 

 Laudus MarketMasters Funds

Financial Notes, unaudited (continued)

7. Purchases and Sales/Maturities of Investment Securities:

For the period ended April 30, 2014, 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		$71,090,030		$78,969,633
Laudus International MarketMasters Fund		844,942,798		833,340,747

8. Derivatives:

The funds entered into equity index futures contracts during the report period. The funds invested in futures to equitize available cash. The fair value and variation margin for futures contracts held at April 30, 2014 are presented on the Portfolio Holdings and Statement of Assets and Liabilities, 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		$3,683,933		32
Laudus International MarketMasters Fund		46,900,860		495

The Laudus International MarketMasters Fund invested in 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 depreciation were $69,521,327 and ($282,752), respectively.

As of April 30, 2014, the derivatives contracts held by the funds, categorized by primary risk exposure, were:

	Laudus Small-Cap		Laudus International
	MarketMasters Fund		MarketMasters Fund
Asset Derivatives	Fair Value
Equity Index - Futures Contracts1		$—		$2,749,271
Forward Foreign Currency Exchange Contracts2		—		324,642
Total		$—		$3,073,913
Liability Derivatives	Fair Value
Equity Index - Futures Contracts3		$106,270		$—
Forward Foreign Currency Exchange Contracts4		—		434,309
Total		$106,270		$434,309

1	Includes cumulative unrealized appreciation 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 appreciation on forward foreign currency exchange contracts.
3	Includes cumulative unrealized depreciation 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.
4	Statement of Assets and Liabilities location: Unrealized depreciation on forward foreign currency exchange contracts.

65

 Laudus MarketMasters Funds

Financial Notes, unaudited (continued)

8. Derivatives (continued):

The effects of the derivatives held by the funds in the Statement of Operations for the period ended April 30, 2014 were:

	Laudus Small-Cap			Laudus International
	MarketMasters Fund			MarketMasters Fund
Equity Index Futures Contracts
Realized Gains (Losses)1		$81,103			$702,153
Change in Unrealized Appreciation (Depreciation)2		(201,265	)		117,186
Forward Foreign Currency Exchange Contracts
Realized Gains (Losses)1		$—			$368,825
Change in Unrealized Appreciation (Depreciation)2		—			(736,192	)

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 change in unrealized appreciation (depreciation) on futures contracts and net change in unrealized appreciation (depreciation) on foreign currency translations.

During the current reporting period, the funds adopted the new disclosure requirements for offsetting assets and liabilities pursuant to which an entity is required to disclose both gross and net information for assets and liabilities related to derivatives, repurchase and reverse repurchase agreements, and securities lending and securities borrowing transactions that are eligible for offset or subject to an enforceable master netting or similar agreement. The funds’ forward foreign currency exchange contracts are entered into pursuant to International Swaps and Derivatives Association, Inc. (“ISDA”) agreements which govern certain terms of derivative transactions. ISDA agreements typically contain, among other things, master netting provisions in the event of a default or other termination event. Master netting provisions allow the funds and the counterparty, in the event of a default or other termination event, to offset payable and receivable amounts for each party related to derivative contracts to one net amount payable by either the funds or the counterparty. The Laudus International MarketMasters Fund’s forward foreign currency exchange contracts, which are reported gross in the Statement of Assets and Liabilities, are presented in the table below. The following table presents the fund’s forward foreign currency exchange contracts, net of amounts available for offset under a master netting agreement and net of any related collateral received by the fund for assets and pledged by the fund for liabilities as of April 30, 2014.

Laudus International MarketMasters Fund
				Gross Amounts Not Offset in the
				Statement of Assets and Liabilities
	Gross Amounts of Assets
	Presented in the			Financial			Cash Collateral		Net
Counterparty	Statement of Assets and Liabilities			Instruments			Received		Amounts(a)
State Street Bank & Trust Co.		$323,612			($323,612	)		$—		$—
State Street Bank London		1,030			(1,030	)		—		—
Total		$324,642			($324,642	)		$—		$—
	Gross Amounts of Liabilities
	Presented in the			Financial			Cash Collateral		Net
Counterparty	Statement of Assets and Liabilities			Instruments			Pledged		Amounts(b)
State Street Bank & Trust Co.		($390,814	)		$323,612			$—		($67,202	)
State Street Bank London		(43,495	)		1,030			—		($42,465	)
Total		($434,309	)		$324,642			$—		($109,667	)

a	Represents the net amount due from the counterparty in the event of default.
b	Represents the net amount due to the counterparty in the event of default.

66 

 Laudus MarketMasters Funds

Financial Notes, unaudited (continued)

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
	(11/1/13-4/30/14)		(11/1/12-10/31/13)
Laudus Small-Cap MarketMasters Fund		$182		$341
Laudus International MarketMasters Fund		4,341		12,421

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, 2013, 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, 2017		$22,461,534		$210,354,492
Total		$22,461,534		$210,354,492

Qualified late-year losses are certain capital and ordinary losses which occur during the portion of a fund’s taxable year subsequent to October 31. A fund may elect to treat any portion of qualified late-year losses as arising during the first day of the next taxable year. For the year ended October 31, 2013, the funds had late-year ordinary losses deferred and capital losses utilized as follows:

	Laudus Small-Cap		Laudus International
	MarketMasters Fund		MarketMasters Fund
Late-year ordinary losses deferred		$1,041,833		$—
Capital losses utilized		28,218,426		158,069,352

As of October 31, 2013, 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, 2013, 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.

67

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 97 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).	76	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).	76	Director, Gilead Sciences, Inc. (2005 – present) Director, Monaco Coach Corporation (2005 – 2009)
David L. Mahoney 1954 Trustee (Trustee of Schwab Capital Trust since 2011.)	Private Investor.	76	Director, Symantec Corporation (2003 – present) Director, Corcept Therapeutics Incorporated (2004 – present)
Kiran M. Patel 1948 Trustee (Trustee of Schwab Capital Trust since 2011.)	Retired. Executive Vice President and General Manager of Small Business Group, Intuit, Inc. (financial software and services for consumers and small businesses) (Dec. 2008 – Sept. 2013).	76	Director, KLA-Tencor Corporation (2008 – present)
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).	76	Director, Eaton (2012 – present) Director and Chairman of the Audit Committee, Oneok Partners LP (2003 – 2013) Director, Oneok, Inc. (2009 – 2013) Lead Independent Director, Board of Cooper Industries (2002 – 2012)
Joseph H. Wender 1944 Trustee (Trustee of Schwab Capital Trust since 2008.)	Senior Consultant, Goldman Sachs & Co., Inc. (investment banking and securities firm) (Jan. 2008 – present); Partner, Colgin Partners, LLC (vineyards) (February 1998 – present).	76	Board Member and Chairman of the Audit Committee, Isis Pharmaceuticals (1994 – present)

68 

 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.	76	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.	97	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, Chief Executive Officer (Dec. 2010 – present), and Chief Investment Officer (Sept. 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 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 (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).

69

 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
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).
David Lekich 1964 Chief Legal Officer and Secretary (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 and Assistant Secretary (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 retire at age 72 or after twenty years as a trustee, whichever comes first. In addition, the retirement policy requires any independent trustee of 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 own stock of The Charles Schwab Corporation, the parent company of 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.

70 

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. Treasury Bills 1 − 3 Months Index An index that includes all publicly issued zero-coupon U.S. Treasury Bills that have a remaining maturity of less than 3 months and more than 1 month, are rated investment grade, and have $250 million or more of outstanding face 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 capital gain or loss is considered unrealized appreciation or depreciation.

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 (Europe, Australasia, Far East) 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.

restricted and illiquid securities Restricted securities are securities that are subject to legal restrictions on their sale. Restricted securities generally can be sold in privately negotiated transactions, pursuant to an exemption from registration under the Securities Act of1933 (the “1933 Act”), or in a registered public offering. Certain restricted securities, such as Section 4(a)(2) commercial paper and Rule 144A securities under the 1933 Act, may be considered to be liquid if they meet the criteria for liquidity established by the Board. Illiquid securities generally are any securities that cannot be disposed of promptly and in the ordinary course of business at approximately the amount at which a fund has valued the instruments. The liquidity of a fund’s investments is monitored under the supervision and direction of the Board. Investments currently not considered liquid include repurchase agreements not maturing within seven days and certain restricted securities.

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. It includes approximately 2000 of the smallest securities based on a combination of their market cap and current index membership.

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.

71

Notes

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 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 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.

^© 2014 Charles Schwab & Co., Inc. All rights reserved. Member SIPC^®. Printed on recycled paper. MFR13563-17

00118057

COMMAND PERFORMANCE^TM

Semiannual report dated April 30, 2014, 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, 2014

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	5
Fund Management	7
Performance and Fund Facts
Schwab Target 2010 Fund	8
Schwab Target 2015 Fund	9
Schwab Target 2020 Fund	10
Schwab Target 2025 Fund	11
Schwab Target 2030 Fund	12
Schwab Target 2035 Fund	13
Schwab Target 2040 Fund	14
Schwab Target 2045 Fund	15
Schwab Target 2050 Fund	16
Schwab Target 2055 Fund	17
Fund Expenses	18
Financial Statements and Portfolio Holdings
Schwab Target 2010 Fund	19
Schwab Target 2015 Fund	25
Schwab Target 2020 Fund	31
Schwab Target 2025 Fund	37
Schwab Target 2030 Fund	43
Schwab Target 2035 Fund	49
Schwab Target 2040 Fund	55
Schwab Target 2045 Fund	61
Schwab Target 2050 Fund	67
Schwab Target 2055 Fund	73
Financial Notes	79
Trustees and Officers	97
Glossary	100

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 6 Months Ended April 30, 20141
Schwab Target 2010 Fund (Ticker Symbol: SWBRX)	3.01%
Target 2010 Composite Index	3.29%
Fund Category: Morningstar Target Date 2000-2010	3.19%
Performance Details	page 8
Schwab Target 2015 Fund (Ticker Symbol: SWGRX)	3.32%
Target 2015 Composite Index	3.69%
Fund Category: Morningstar Target Date 2011-2015	3.49%
Performance Details	page 9
Schwab Target 2020 Fund (Ticker Symbol: SWCRX)	4.02%
Target 2020 Composite Index	4.36%
Fund Category: Morningstar Target Date 2016-2020	3.70%
Performance Details	page 10
Schwab Target 2025 Fund (Ticker Symbol: SWHRX)	4.49%
Target 2025 Composite Index	4.82%
Fund Category: Morningstar Target Date 2021-2025	4.30%
Performance Details	page 11
Schwab Target 2030 Fund (Ticker Symbol: SWDRX)	4.82%
Target 2030 Composite Index	5.17%
Fund Category: Morningstar Target Date 2026-2030	4.35%
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.

The components that make up each of the composite indices may vary over time. For index definitions, please see the Glossary.

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.

¹ The report period covers the 6 months beginning November 1, 2013 through April 30, 2014, 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 6 Months Ended April 30, 20141
Schwab Target 2035 Fund (Ticker Symbol: SWIRX)	5.09%
Target 2035 Composite Index	5.47%
Fund Category: Morningstar Target Date 2031-2035	4.84%
Performance Details	page 13
Schwab Target 2040 Fund (Ticker Symbol: SWERX)	5.41%
Target 2040 Composite Index	5.67%
Fund Category: Morningstar Target Date 2036-2040	4.73%
Performance Details	page 14
Schwab Target 2045 Fund2 (Ticker Symbol: SWMRX)	5.51%
Target 2045 Composite Index	5.78%
Fund Category: Morningstar Target Date 2041-2045	5.06%
Performance Details	page 15
Schwab Target 2050 Fund2 (Ticker Symbol: SWNRX)	5.58%
Target 2050 Composite Index	5.88%
Fund Category: Morningstar Target Date 2046-2050	4.84%
Performance Details	page 16
Schwab Target 2055 Fund2 (Ticker Symbol: SWORX)	5.66%
Target 2055 Composite Index	5.92%
Fund Category: Morningstar Target Date 2051+	5.18%
Performance Details	page 17

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.

The components that make up each of the composite indices may vary over time. For index definitions, please see the Glossary.

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.

1	The report period covers the 6 months beginning November 1, 2013 through April 30, 2014, 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.

4 Schwab Target 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 regarding 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-month reporting period ended April 30, 2014, the funds generated returns that reflected a rally by stocks in U.S. and developed international markets, combined with modest returns for bonds. Efforts undertaken by the Federal Reserve, the European Central Bank, the Bank of Japan, and other central banks to keep interest rates low and stimulate economic growth provided a catalyst for these results. Stocks generally benefited from these policies, while bonds generated modest returns that reflected the low interest rate environment.

With the U.S. economy showing some signs of improvement, the Fed began “tapering” its stimulative policies in early 2014, but provided reassurances that low interest rates remain necessary for now. The Fed’s reassurances supported stocks, while concurrently helping longer-term bonds generate respectable returns late in the six months. Many major U.S. stock market indices reached record highs in April and finished at or near these levels by the end of the period, with the S&P 500 Index returning 8.4%, and the MSCI EAFE Index

 Asset Class Performance Comparison % returns during the six months ended 4/30/2014

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

	8.36%	S&P 500® Index: measures U.S. large-cap stocks
	3.08%	Russell 2000® Index: measures U.S. small-cap stocks
	4.44%	MSCI EAFE® Index (Net): measures (in U.S. dollars) large-cap stocks in Europe, Australasia and the Far East
	1.74%	Barclays U.S. Aggregate Bond Index: measures the U.S. bond market
	0.02%	Barclays U.S. Treasury Bills 1-3 Months Index: 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.

For index definitions, please see the Glossary.

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 Target Funds 5

From the President continued

For the six-month reporting period ended April 30, 2014, the funds generated returns that reflected a rally by stocks in U.S. and developed international markets, combined with modest returns for bonds.

returning 4.4%.¹ Representing the broad performance of U.S. fixed income securities, the Barclays U.S. Aggregate Bond Index returned 1.7%.

For more information about the performance, holdings, and portfolio characteristics of the Schwab Target Funds, please continue reading this report. In addition, you can find further details about these funds by visiting www.schwabfunds.com, or by contacting us at 1-800-435-4000.

Sincerely,

For full definitions of the referenced indices, please see the Glossary.

¹ The total return cited is for the MSCI EAFE Index (Net), which is calculated net of foreign withholding taxes.

6 Schwab Target Funds

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.

Schwab Target Funds 7

Schwab Target 2010 Fund

Performance and Fund Facts as of 04/30/14

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)		3.01	%		6.31	%		10.06	%		4.81	%
Target 2010 Composite Index		3.29	%		6.25	%		10.30	%		5.73	%
Dow Jones U.S. Total Stock Market Index		7.82	%		20.65	%		19.62	%		8.01	%
Barclays U.S. Aggregate Bond Index		1.74	%		-0.26	%		4.88	%		4.68	%
Fund Category: Morningstar Target Date 2000-2010		3.19	%		5.75	%		10.48	%		4.84	%

Fund Expense Ratios³: Net 0.52%; Gross 0.70%

 Statistics

Number of Holdings	22
Portfolio Turnover Rate4	13%

 Asset Class Weightings % of Investments⁵

Fixed-Income Funds – Intermediate-Term Bond	32.9%
Equity Funds – Large-Cap	26.5%
Fixed-Income Funds – Short-Term Bond	15.4%
Equity Funds – International	7.8%
Fixed -Income Funds – Inflation-Protected Bond	5.2%
Equity Funds – Small-Cap	3.4%
Money Market Funds	3.2%
Short-Term Investments	3.1%
Equity Funds – Global Real Estate	1.9%
Fixed-Income Funds – International Bond	0.6%
Total	100.0%

 Top Holdings % of Net Assets^6,7

Schwab Total Bond Market Fund	20.8%
Schwab Short-Term Bond Market Fund	15.4%
Schwab Core Equity Fund	6.5%
Laudus U.S. Large Cap Growth Fund	6.5%
Schwab S&P 500 Index Fund	6.4%
PIMCO Total Return Fund, Institutional Shares	6.2%
Schwab Treasury Inflation Protected Securities Index Fund	5.1%
Schwab Dividend Equity Fund	3.5%
TCW Relative Value Large Cap Fund	3.5%
Laudus International MarketMasters Fund, Select Shares	3.1%
Total	77.0%

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.

For index definitions, please see the Glossary.

Portfolio holdings may have changed since the report date.

The Laudus 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	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 0.52%. 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	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, and cash equivalents, including money market securities.
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 Target Funds

Schwab Target 2015 Fund

Performance and Fund Facts as of 04/30/14

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)		3.32	%		7.63	%		11.56	%		5.50	%
Target 2015 Composite Index		3.69	%		7.54	%		11.66	%		5.46	%
Dow Jones U.S. Total Stock Market Index		7.82	%		20.65	%		19.62	%		8.89	%
Barclays U.S. Aggregate Bond Index		1.74	%		-0.26	%		4.88	%		4.83	%
Fund Category: Morningstar Target Date 2011-2015		3.49	%		6.48	%		11.30	%		4.87	%

Fund Expense Ratios³: Net 0.58%; Gross 0.72%

 Statistics

Number of Holdings	23
Portfolio Turnover Rate4	12%

 Asset Class Weightings % of Investments⁵

Fixed-Income Funds – Intermediate-Term Bond	31.3%
Equity Funds – Large-Cap	29.0%
Fixed-Income Funds – Short-Term Bond	13.2%
Equity Funds – International	9.1%
Fixed -Income Funds – Inflation-Protected Bond	4.6%
Equity Funds – Small-Cap	4.1%
Short-Term Investments	3.1%
Money Market Funds	2.6%
Equity Funds – Global Real Estate	2.2%
Fixed-Income Funds – International Bond	0.8%
Total	100.0%

 Top Holdings % of Net Assets^6,7

Schwab Total Bond Market Fund	18.4%
Schwab Short-Term Bond Market Fund	13.2%
Schwab Core Equity Fund	7.2%
Laudus U.S. Large Cap Growth Fund	7.1%
Schwab S&P 500 Index Fund	6.9%
PIMCO Total Return Fund, Institutional Shares	6.6%
Schwab Treasury Inflation Protected Securities Index Fund	4.6%
TCW Relative Value Large Cap Fund	3.9%
Schwab Dividend Equity Fund	3.9%
Laudus International MarketMasters Fund, Select Shares	3.6%
Total	75.4%

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.

For index definitions, please see the Glossary.

Portfolio holdings may have changed since the report date.

The Laudus 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	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 0.58%. 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	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, and cash equivalents, including money market securities.
6	This list is not a recommendation of any security by the investment adviser.
7	The holdings listed exclude any temporary liquidity investments.

Schwab Target Funds 9

Schwab Target 2020 Fund

Performance and Fund Facts as of 04/30/14

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)		4.02	%		10.05	%		13.24	%		6.21	%
Target 2020 Composite Index		4.36	%		9.79	%		13.07	%		6.61	%
Dow Jones U.S. Total Stock Market Index		7.82	%		20.65	%		19.62	%		8.01	%
Barclays U.S. Aggregate Bond Index		1.74	%		-0.26	%		4.88	%		4.68	%
Fund Category: Morningstar Target Date 2016-2020		3.70	%		7.55	%		12.23	%		5.06	%

Fund Expense Ratios³: Net 0.65%; Gross 0.70%

 Statistics

Number of Holdings	22
Portfolio Turnover Rate4	8%

 Asset Class Weightings % of Investments⁵

Equity Funds – Large-Cap	36.6%
Fixed-Income Funds – Intermediate-Term Bond	26.0%
Equity Funds – International	12.4%
Fixed-Income Funds – Short-Term Bond	7.8%
Equity Funds – Small-Cap	6.1%
Fixed -Income Funds – Inflation-Protected Bond	3.2%
Equity Funds – Global Real Estate	2.9%
Short-Term Investments	2.8%
Fixed-Income Funds – International Bond	1.1%
Money Market Funds	1.1%
Total	100.0%

 Top Holdings % of Net Assets^6,7

Schwab Total Bond Market Fund	12.2%
Schwab Core Equity Fund	9.3%
Laudus U.S. Large Cap Growth Fund	9.0%
Schwab S&P 500 Index Fund	8.8%
Schwab Short-Term Bond Market Fund	7.8%
PIMCO Total Return Fund, Institutional Shares	7.2%
Schwab Dividend Equity Fund	4.8%
Laudus International MarketMasters Fund, Select Shares	4.7%
TCW Relative Value Large Cap Fund	4.6%
Schwab Small-Cap Equity Fund	4.0%
Total	72.4%

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.

For index definitions, please see the Glossary.

Portfolio holdings may have changed since the report date.

The Laudus 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	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.
4	Not annualized.
5	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, and cash equivalents, including money market securities.
6	This list is not a recommendation of any security by the investment adviser.
7	The holdings listed exclude any temporary liquidity investments.

10 Schwab Target Funds

Schwab Target 2025 Fund

Performance and Fund Facts as of 04/30/14

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)		4.49	%		11.88	%		14.48	%		7.50	%
Target 2025 Composite Index		4.82	%		11.44	%		14.07	%		6.68	%
Dow Jones U.S. Total Stock Market Index		7.82	%		20.65	%		19.62	%		8.89	%
Barclays U.S. Aggregate Bond Index		1.74	%		-0.26	%		4.88	%		4.83	%
Fund Category: Morningstar Target Date 2021-2025		4.30	%		9.87	%		13.75	%		5.56	%

Fund Expense Ratios³: Net 0.71%; Gross 0.79%

 Statistics

Number of Holdings	22
Portfolio Turnover Rate4	7%

 Asset Class Weightings % of Investments⁵

Equity Funds – Large-Cap	41.7%
Fixed-Income Funds – Intermediate-Term Bond	21.0%
Equity Funds – International	15.0%
Equity Funds – Small-Cap	7.8%
Fixed-Income Funds – Short-Term Bond	4.9%
Equity Funds – Global Real Estate	3.3%
Short-Term Investments	3.1%
Fixed-Income Funds – Inflation-Protected Bond	2.2%
Fixed-Income Funds – International Bond	1.0%
Total	100.0%

 Top Holdings % of Net Assets^6,7

Schwab Core Equity Fund	10.7%
Laudus U.S. Large Cap Growth Fund	10.3%
Schwab S&P 500 Index Fund	10.0%
Schwab Total Bond Market Fund	8.2%
PIMCO Total Return Fund, Institutional Shares	6.8%
Laudus International MarketMasters Fund, Select Shares	5.5%
Schwab Dividend Equity Fund	5.4%
TCW Relative Value Large Cap Fund	5.2%
Schwab Small-Cap Equity Fund	5.1%
Schwab Short-Term Bond Market Fund	4.9%
Total	72.1%

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.

For index definitions, please see the Glossary.

Portfolio holdings may have changed since the report date.

The Laudus 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	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 0.71%. 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	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, and cash equivalents, including money market securities.
6	This list is not a recommendation of any security by the investment adviser.
7	The holdings listed exclude any temporary liquidity investments.

Schwab Target Funds 11

Schwab Target 2030 Fund

Performance and Fund Facts as of 04/30/14

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)		4.82	%		13.22	%		15.28	%		7.04	%
Target 2030 Composite Index		5.17	%		12.78	%		14.81	%		7.17	%
Dow Jones U.S. Total Stock Market Index		7.82	%		20.65	%		19.62	%		8.01	%
Barclays U.S. Aggregate Bond Index		1.74	%		-0.26	%		4.88	%		4.68	%
Fund Category: Morningstar Target Date 2026-2030		4.35	%		10.53	%		14.05	%		5.38	%

Fund Expense Ratios³: Net 0.74%; Gross 0.78%

 Statistics

Number of Holdings	21
Portfolio Turnover Rate4	7%

 Asset Class Weightings % of Investments⁵

Equity Funds – Large-Cap	45.6%
Equity Funds – International	17.1%
Fixed-Income Funds – Intermediate-Term Bond	16.3%
Equity Funds – Small-Cap	9.3%
Equity Funds – Global Real Estate	3.8%
Fixed-Income Funds – Short-Term Bond	3.0%
Short-Term Investments	2.5%
Fixed-Income Funds – Inflation-Protected Bond	1.6%
Fixed-Income Funds – International Bond	0.8%
Total	100.0%

 Top Holdings % of Net Assets^6,7

Schwab Core Equity Fund	11.8%
Laudus U.S. Large Cap Growth Fund	11.2%
Schwab S&P 500 Index Fund	10.6%
Laudus International MarketMasters Fund, Select Shares	6.1%
Schwab Small-Cap Equity Fund	6.1%
TCW Relative Value Large Cap Fund	6.0%
Schwab Dividend Equity Fund	5.9%
PIMCO Total Return Fund, Institutional Shares	5.7%
Schwab Total Bond Market Fund	5.4%
William Blair International Small Cap Growth Fund, Institutional Shares	3.4%
Total	72.2%

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.

For index definitions, please see the Glossary.

Portfolio holdings may have changed since the report date.

The Laudus 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	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 0.74%. 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	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, and cash equivalents, including money market securities.
6	This list is not a recommendation of any security by the investment adviser.
7	The holdings listed exclude any temporary liquidity investments.

12 Schwab Target Funds

Schwab Target 2035 Fund

Performance and Fund Facts as of 04/30/14

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)		5.09	%		14.58	%		16.13	%		8.07	%
Target 2035 Composite Index		5.47	%		14.00	%		15.58	%		7.25	%
Dow Jones U.S. Total Stock Market Index		7.82	%		20.65	%		19.62	%		8.89	%
Barclays U.S. Aggregate Bond Index		1.74	%		-0.26	%		4.88	%		4.83	%
Fund Category: Morningstar Target Date 2031-2035		4.84	%		12.54	%		15.14	%		5.89	%

Fund Expense Ratios³: Net 0.78%; Gross 0.87%

 Statistics

Number of Holdings	21
Portfolio Turnover Rate4	5%

 Asset Class Weightings % of Investments⁵

Equity Funds – Large -Cap	48.8%
Equity Funds – International	19.0%
Fixed-Income Funds – Intermediate-Term Bond	11.6%
Equity Funds – Small-Cap	10.7%
Equity Funds – Global Real Estate	4.1%
Short-Term Investments	2.3%
Fixed-Income Funds – Short-Term Bond	2.0%
Fixed-Income Funds – Inflation-Protected Bond	1.0%
Fixed-Income Funds – International Bond	0.5%
Total	100.0%

 Top Holdings % of Net Assets^6,7

Schwab Core Equity Fund	12.7%
Laudus U.S. Large Cap Growth Fund	12.1%
Schwab S&P 500 Index Fund	11.5%
Schwab Small-Cap Equity Fund	7.0%
Laudus International MarketMasters Fund, Select Shares	6.6%
Schwab Dividend Equity Fund	6.3%
TCW Relative Value Large Cap Fund	6.1%
PIMCO Total Return Fund, Institutional Shares	4.6%
Schwab Global Real Estate Fund	4.1%
William Blair International Small Cap Growth Fund, Institutional Shares	3.7%
Total	74.7%

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.

For index definitions, please see the Glossary.

Portfolio holdings may have changed since the report date.

The Laudus 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	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 0.78%. 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	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, and cash equivalents, including money market securities.
6	This list is not a recommendation of any security by the investment adviser.
7	The holdings listed exclude any temporary liquidity investments.

Schwab Target Funds 13

Schwab Target 2040 Fund

Performance and Fund Facts as of 04/30/14

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)		5.41	%		15.64	%		16.71	%		7.62	%
Target 2040 Composite Index		5.67	%		14.88	%		16.16	%		7.57	%
Dow Jones U.S. Total Stock Market Index		7.82	%		20.65	%		19.62	%		8.01	%
Barclays U.S. Aggregate Bond Index		1.74	%		-0.26	%		4.88	%		4.68	%
Fund Category: Morningstar Target Date 2036-2040		4.73	%		12.41	%		15.10	%		5.74	%

Fund Expense Ratios³: Net 0.80%; Gross 0.84%

 Statistics

Number of Holdings	21
Portfolio Turnover Rate4	5%

 Asset Class Weightings % of Investments⁵

Equity Funds – Large-Cap	51.3%
Equity Funds – International	20.7%
Equity Funds – Small-Cap	11.9%
Fixed-Income Funds – Intermediate-Term Bond	7.5%
Equity Funds – Global Real Estate	4.4%
Short-Term Investments	2.1%
Fixed-Income Funds – Short-Term Bond	1.4%
Fixed-Income Funds – Inflation-Protected Bond	0.5%
Fixed-Income Funds – International Bond	0.2%
Total	100.0%

 Top Holdings % of Net Assets^6,7

Schwab Core Equity Fund	13.4%
Laudus U.S. Large Cap Growth Fund	12.7%
Schwab S&P 500 Index Fund	11.9%
Schwab Small-Cap Equity Fund	7.8%
Laudus International MarketMasters Fund, Select Shares	7.1%
TCW Relative Value Large Cap Fund	6.7%
Schwab Dividend Equity Fund	6.6%
Schwab Global Real Estate Fund	4.4%
Laudus Small-Cap MarketMasters Fund, Select Shares	4.2%
William Blair International Small Cap Growth Fund, Institutional Shares	4.0%
Total	78.8%

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.

For index definitions, please see the Glossary.

Portfolio holdings may have changed since the report date.

The Laudus 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	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 0.80%. 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	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, and cash equivalents, including money market securities.
6	This list is not a recommendation of any security by the investment adviser.
7	The holdings listed exclude any temporary liquidity investments.

14 Schwab Target Funds

Schwab Target 2045 Fund

Performance and Fund Facts as of 04/30/14

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			Since Inception
Fund: Schwab Target 2045 Fund (1/23/13)		5.51	%		16.06	%		17.74	%
Target 2045 Composite Index		5.78	%		15.38	%		17.91	%
Dow Jones U.S. Total Stock Market Index		7.82	%		20.65	%		22.78	%
Barclays U.S. Aggregate Bond Index		1.74	%		-0.26	%		0.63	%
Fund Category: Morningstar Target Date 2041-2045		5.06	%		13.70	%		15.23	%

Fund Expense Ratios³: Net 0.75%; Gross 1.83%

 Statistics

Number of Holdings	21
Portfolio Turnover Rate4	4%

 Asset Class Weightings % of Investments⁵

Equity Funds – Large -Cap	52.7%
Equity Funds – International	21.7%
Equity Funds – Small- Cap	12.6%
Fixed- Income Funds – Intermediate – Term Bond	5.1%
Equity Funds – Global Real Estate	4.5%
Short-Term Investments	2.0%
Fixed -Income Funds – Short -Term Bonds	1.0%
Fixed-Income Funds – Inflation-Protected Bond	0.3%
Fixed-Income Funds – International Bond	0.1%
Total	100.0%

 Top Holdings % of Net Assets^6,7

Schwab Core Equity Fund	13.7%
Laudus U.S. Large Cap Growth Fund	13.0%
Schwab S&P 500 Index Fund	12.3%
Schwab Small-Cap Equity Fund	8.2%
Laudus International MarketMasters Fund, Select Shares	7.3%
Schwab Dividend Equity Fund	6.8%
TCW Relative Value Large Cap Fund	6.8%
Schwab Global Real Estate Fund	4.5%
Laudus Small-Cap MarketMasters Fund, Select Shares	4.4%
William Blair International Small Cap Growth Fund, Institutional Shares	4.1%
Total	81.1%

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.

For index definitions, please see the Glossary.

Portfolio holdings may have changed since the report date.

The Laudus 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	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.
4	Not annualized.
5	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, and cash equivalents, including money market securities.
6	This list is not a recommendation of any security by the investment adviser.
7	The holdings listed exclude any temporary liquidity investments.

Schwab Target Funds 15

Schwab Target 2050 Fund

Performance and Fund Facts as of 04/30/14

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			Since Inception
Fund: Schwab Target 2050 Fund (1/23/13)		5.58	%		16.63	%		18.29	%
Target 2050 Composite Index		5.88	%		15.81	%		18.41	%
Dow Jones U.S. Total Stock Market Index		7.82	%		20.65	%		22.78	%
Barclays U.S. Aggregate Bond Index		1.74	%		-0.26	%		0.63	%
Fund Category: Morningstar Target Date 2046-2050		4.84	%		12.97	%		14.73	%

Fund Expense Ratios³: Net 0.76%; Gross 2.13%

 Statistics

Number of Holdings	21
Portfolio Turnover Rate4	6%

 Asset Class Weightings % of Investments⁵

Equity Funds – Large-Cap	53.6%
Equity Funds – International	22.4%
Equity Funds – Small-Cap	13.2%
Equity Funds – Global Real Estate	4.7%
Fixed-Income Funds – Intermediate-Term Bond	3.2%
Short-Term Investments	2.1%
Fixed-Income Funds – Short-Term Bond	0.6%
Fixed-Income Funds – International Bond	0.1%
Fixed-Income Funds – Inflation-Protected Bond	0.1%
Total	100.0%

 Top Holdings % of Net Assets^6,7

Schwab Core Equity Fund	14.0%
Laudus U.S. Large Cap Growth Fund	13.3%
Schwab S&P 500 Index Fund	12.7%
Schwab Small-Cap Equity Fund	8.6%
Laudus International MarketMasters Fund, Select Shares	7.5%
Schwab Dividend Equity Fund	7.0%
TCW Relative Value Large Cap Fund	6.7%
Schwab Global Real Estate Fund	4.7%
Laudus Small-Cap MarketMasters Fund, Select Shares	4.6%
William Blair International Small Cap Growth Fund, Institutional Shares	4.2%
Total	83.3%

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.

For index definitions, please see the Glossary.

Portfolio holdings may have changed since the report date.

The Laudus 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	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 0.76%. 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	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, and cash equivalents, including money market securities.
6	This list is not a recommendation of any security by the investment adviser.
7	The holdings listed exclude any temporary liquidity investments.

16 Schwab Target Funds

Schwab Target 2055 Fund

Performance and Fund Facts as of 04/30/14

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			Since Inception
Fund: Schwab Target 2055 Fund (1/23/13)		5.66	%		16.80	%		18.52	%
Target 2055 Composite Index		5.92	%		16.06	%		18.70	%
Dow Jones U.S. Total Stock Market Index		7.82	%		20.65	%		22.78	%
Barclays U.S. Aggregate Bond Index		1.74	%		-0.26	%		0.63	%
Fund Category: Morningstar Target Date 2051+		5.18	%		14.43	%		15.99	%

Fund Expense Ratios³: Net 0.73%; Gross 3.51%

 Statistics

Number of Holdings	21
Portfolio Turnover Rate4	11%

 Asset Class Weightings % of Investments⁵

Equity Funds – Large-Cap	54.8%
Equity Funds – International	23.1%
Equity Funds – Small-Cap	13.7%
Equity Funds – Global Real Estate	4.8%
Short-Term Investments	1.7%
Fixed-Income Funds – Intermediate-Term Bond	1.6%
Fixed-Income Funds – Short-Term Bond	0.3%
Total	100.0%

 Top Holdings % of Net Assets^6,7

Schwab Core Equity Fund	14.3%
Laudus U.S. Large Cap Growth Fund	13.5%
Schwab S&P 500 Index Fund	12.9%
Schwab Small-Cap Index Fund	8.9%
Laudus International MarketMasters Fund, Select Shares	7.7%
Schwab Dividend Equity Fund	7.1%
TCW Relative Value Large Cap Fund	6.9%
Schwab Global Real Estate Fund	4.8%
Laudus Small-Cap MarketMasters Fund, Select Shares	4.8%
William Blair International Small Cap Growth Fund, Institutional Shares	4.3%
Total	85.2%

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.

For index definitions, please see the Glossary.

Portfolio holdings may have changed since the report date.

The Laudus 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	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 0.73%. 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	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, and cash equivalents, including money market securities.
6	This list is not a recommendation of any security by the investment adviser.
7	The holdings listed exclude any temporary liquidity investments.

Schwab Target Funds 17

Fund Expenses (Unaudited)

 Examples for a $1,000 Investment

As a fund shareholder, you may incur two types of costs: (1) transaction costs, such as redemption fees; and (2) ongoing costs, including 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, 2013 and held through April 30, 2014.

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 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 a 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. Therefore, the hypothetical return lines of the table are useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, 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 11/1/13		at 4/30/14		11/1/13–4/30/14
Schwab Target 2010 Fund
Actual Return		0.00%	$	1,000.00	$	1,030.10	$	0.00
Hypothetical 5% Return		0.00%	$	1,000.00	$	1,024.79	$	0.00
Schwab Target 2015 Fund
Actual Return		0.00%	$	1,000.00	$	1,033.20	$	0.00
Hypothetical 5% Return		0.00%	$	1,000.00	$	1,024.79	$	0.00
Schwab Target 2020 Fund
Actual Return		0.00%	$	1,000.00	$	1,040.20	$	0.00
Hypothetical 5% Return		0.00%	$	1,000.00	$	1,024.79	$	0.00
Schwab Target 2025 Fund
Actual Return		0.00%	$	1,000.00	$	1,044.90	$	0.00
Hypothetical 5% Return		0.00%	$	1,000.00	$	1,024.79	$	0.00
Schwab Target 2030 Fund
Actual Return		0.00%	$	1,000.00	$	1,048.20	$	0.00
Hypothetical 5% Return		0.00%	$	1,000.00	$	1,024.79	$	0.00
Schwab Target 2035 Fund
Actual Return		0.00%	$	1,000.00	$	1,050.90	$	0.00
Hypothetical 5% Return		0.00%	$	1,000.00	$	1,024.79	$	0.00
Schwab Target 2040 Fund
Actual Return		0.00%	$	1,000.00	$	1,054.10	$	0.00
Hypothetical 5% Return		0.00%	$	1,000.00	$	1,024.79	$	0.00
Schwab Target 2045 Fund
Actual Return		0.00%	$	1,000.00	$	1,055.10	$	0.00
Hypothetical 5% Return		0.00%	$	1,000.00	$	1,024.79	$	0.00
Schwab Target 2050 Fund
Actual Return		0.00%	$	1,000.00	$	1,055.80	$	0.00
Hypothetical 5% Return		0.00%	$	1,000.00	$	1,024.79	$	0.00
Schwab Target 2055 Fund
Actual Return		0.00%	$	1,000.00	$	1,056.60	$	0.00
Hypothetical 5% Return		0.00%	$	1,000.00	$	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 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.

18 Schwab Target Funds

Schwab Target 2010 Fund

Financial Statements

Financial Highlights

	11/1/13–			11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–
	4/30/14*			10/31/13			10/31/12			10/31/11			10/31/10			10/31/09
Per-Share Data ($)
Net asset value at beginning of period		11.91			11.10			10.56			10.34			9.46			8.76
Income (loss) from investment operations:
Net investment income (loss)		0.11			0.21			0.22			0.23			0.23			0.28
Net realized and unrealized gains (losses)		0.24			0.85			0.57			0.24			0.89			0.75
Total from investment operations		0.35			1.06			0.79			0.47			1.12			1.03
Less distributions:
Distributions from net investment income		(0.20	)		(0.25	)		(0.25	)		(0.25	)		(0.24	)		(0.33	)
Net asset value at end of period		12.06			11.91			11.10			10.56			10.34			9.46
Total return (%)		3.01	1		9.74			7.63			4.63	2		11.99			12.24
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses3		—	4		—			—			—			0.00	5		0.03	6
Gross operating expenses3		0.17	4		0.18			0.18			0.14			0.16			0.16
Net investment income (loss)		1.86	4		1.77			1.95			2.11			2.21			3.04
Portfolio turnover rate		13	1		26			13			11			24			47
Net assets, end of period ($ x 1,000,000)		62			61			60			64			73			75

* 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.

See financial notes 19

 Schwab Target 2010 Fund

Portfolio Holdings as of April 30, 2014 (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%	Other Investment Companies		49,375,076		59,703,911
	3	.1%	Short-Term Investments		1,914,622		1,914,622
	99	.8%	Total Investments		51,289,698		61,618,533
	0	.2%	Other Assets and Liabilities, Net				104,015
	100	.0%	Net Assets				61,722,548

	Number		Value
Security	of Shares		($)
Other Investment Companies 96.7% of net assets
Equity Funds 39.6%
Global Real Estate 2.0%
Schwab Global Real Estate Fund (a)		173,308		1,199,289
International 7.8%
American Century International Growth Fund, Institutional Shares		75,930		1,020,503
Laudus International MarketMasters Fund, Select Shares (a)		78,851		1,907,418
Laudus Mondrian International Equity Fund, Institutional Shares (a)		85,219		764,418
William Blair International Small Cap Growth Fund, Institutional Shares		68,897		1,107,180
				4,799,519
Large-Cap 26.4%
Laudus U.S. Large Cap Growth Fund *(a)		224,460		3,986,401
Schwab Core Equity Fund (a)		172,233		4,031,973
Schwab Dividend Equity Fund (a)		119,918		2,183,712
Schwab S&P 500 Index Fund (a)		133,756		3,955,154
TCW Relative Value Large Cap Fund		102,416		2,157,912
				16,315,152
Small-Cap 3.4%
Laudus Small-Cap MarketMasters Fund, Select Shares *(a)		41,960		741,437
Schwab Small-Cap Equity Fund (a)		57,127		1,375,037
				2,116,474
				24,430,434
Fixed-Income Funds 53.9%
Inflation-Protected Bond 5.1%
Schwab Treasury Inflation Protected Securities Index Fund (a)		283,566		3,178,776
Intermediate-Term Bond 32.8%
Natixis Loomis Sayles Investment Grade Bond Fund, Class Y Shares		143,520		1,763,857
PIMCO Total Return Fund, Institutional Shares		351,196		3,806,961
Schwab Intermediate-Term Bond Fund (a)		182,779		1,862,519
Schwab Total Bond Market Fund (a)		1,362,984		12,852,943
				20,286,280
International Bond 0.6%
Laudus Mondrian International Government Fixed Income Fund *(a)		32,199		354,508
Short-Term Bond 15.4%
Schwab Short-Term Bond Market Fund (a)		1,022,135		9,485,412
				33,304,976
Money Market Fund 3.2%
Schwab Value Advantage Money Fund, Institutional Prime Shares 0.01% (a)(b)		1,968,501		1,968,501
Total Other Investment Companies
(Cost $49,375,076)				59,703,911
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 3.1% of net assets
Time Deposits 3.1%
Citibank
0.03%, 05/01/14		67,140		67,140
DNB
0.03%, 05/01/14		1,847,482		1,847,482
Total Short-Term Investments
(Cost $1,914,622)				1,914,622
End of Investments.

At 04/30/14, the tax basis cost of the fund’s investments was $52,192,955 and the unrealized appreciation and depreciation were $9,447,013 and ($21,435), respectively, with a net unrealized appreciation of $9,425,578.

*	Non-income producing security.
(a)	Issuer is affiliated with the fund’s adviser.
(b)	The rate shown is the 7-day yield.

20 See financial notes

 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, 2014 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Other Significant		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Other Investment Companies1		$59,703,911		$—		$—		$59,703,911
Short-Term Investments1		—		1,914,622		—		1,914,622
Total		$59,703,911		$1,914,622		$—		$61,618,533

¹ As categorized in portfolio holdings.

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, 2014.

See financial notes 21

 Schwab Target 2010 Fund

Statement of

Assets and Liabilities

As of April 30, 2014; unaudited

Assets
Investments in affiliated underlying funds, at value (cost $41,476,324)		$49,847,498
Investments in unaffiliated issuers, at value (cost $9,813,374)	+	11,771,035
Total investments, at value (cost $51,289,698)		61,618,533
Receivables:
Investments sold		480,000
Fund shares sold		109,656
Dividends		41,349
Due from investment adviser		670
Interest		2
Prepaid expenses	+	1,206
Total assets		62,251,416
Liabilities
Payables:
Investments bought		451,352
Fund shares redeemed		47,466
Accrued expenses	+	30,050
Total liabilities		528,868
Net Assets
Total assets		62,251,416
Total liabilities	−	528,868
Net assets		$61,722,548
Net Assets by Source
Capital received from investors		65,650,251
Net investment income not yet distributed		81,660
Net realized capital losses		(14,338,198	)
Net unrealized capital appreciation		10,328,835
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$61,722,548		5,116,651			$12.06

22 See financial notes

 Schwab Target 2010 Fund

Statement of

Operations

For the period November 1, 2013 through April 30, 2014; unaudited

Investment Income
Dividends received from affiliated underlying funds		$426,418
Dividends received from unaffiliated underlying funds		137,788
Interest	+	294
Total investment income		564,500
Expenses
Professional fees		17,898
Transfer agent fees		11,344
Registration fees		9,468
Portfolio accounting fees		4,486
Shareholder reports		3,282
Independent trustees’ fees		3,129
Custodian fees		2,257
Other expenses	+	996
Total expenses		52,860
Expense reduction by CSIM	−	52,860
Net expenses	−	—
Net investment income		564,500
Realized and Unrealized Gains (Losses)
Realized capital gain distributions received from affiliated underlying funds		791,368
Realized capital gain distributions received from unaffiliated underlying funds		139,725
Net realized gains on sales of affiliated underlying funds		1,440,704
Net realized gains on sales of unaffiliated underlying funds	+	220,640
Net realized gains		2,592,437
Net change in unrealized appreciation (depreciation) on affiliated underlying funds		(1,219,117	)
Net change in unrealized appreciation (depreciation) on unaffiliated underlying funds	+	(145,716	)
Net change in unrealized appreciation (depreciation)	+	(1,364,833	)
Net realized and unrealized gains		1,227,604
Increase in net assets resulting from operations		$1,792,104

See financial notes 23

 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

11/1/13-4/30/14				11/1/12-10/31/13
Net investment income		$564,500			$1,060,327
Net realized gains		2,592,437			1,990,548
Net change in unrealized appreciation (depreciation)	+	(1,364,833	)		2,583,987
Increase in net assets from operations		1,792,104			5,634,862
Distributions to Shareholders
Distributions from net investment income		($1,036,165	)		($1,315,027	)

Transactions in Fund Shares

		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		VALUE			SHARES		VALUE
Shares sold			489,083		$5,850,032			1,476,821		$16,885,894
Shares reinvested			81,616		967,148			111,466		1,225,017
Shares redeemed	+		(595,271	)	(7,102,271	)		(1,819,181	)	(20,804,281	)
Net transactions in fund shares			(24,572	)	($285,091	)		(230,894	)	($2,693,370	)
Shares Outstanding and Net Assets
		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			5,141,223		$61,251,700			5,372,117		$59,625,235
Total increase or decrease	+		(24,572	)	470,848			(230,894	)	1,626,465
End of period			5,116,651		$61,722,548			5,141,223		$61,251,700
Net investment income not yet distributed					$81,660					$553,325

24 See financial notes

Schwab Target 2015 Fund

Financial Statements

Financial Highlights

	11/1/13–			11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–
	4/30/14*			10/31/13			10/31/12			10/31/11			10/31/10			10/31/09
Per-Share Data ($)
Net asset value at beginning of period		12.22			11.13			10.48			10.16			9.09			8.15
Income (loss) from investment operations:
Net investment income (loss)		0.12			0.20			0.20			0.19			0.16			0.19
Net realized and unrealized gains (losses)		0.28			1.12			0.66			0.32			1.06			0.91
Total from investment operations		0.40			1.32			0.86			0.51			1.22			1.10
Less distributions:
Distributions from net investment income		(0.20	)		(0.23	)		(0.21	)		(0.19	)		(0.15	)		(0.16	)
Distributions from net realized gains		—			—			—			—			—			(0.00	)1
Total distributions		(0.20	)		(0.23	)		(0.21	)		(0.19	)		(0.15	)		(0.16	)
Net asset value at end of period		12.42			12.22			11.13			10.48			10.16			9.09
Total return (%)		3.32	2		12.06			8.41			5.10			13.55			13.82
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses3		—	4		—			—			—			0.00	5		0.02	6
Gross operating expenses3		0.12	4		0.14			0.19			0.22			0.39			0.85
Net investment income (loss)		1.92	4		1.72			1.85			1.94			1.91			2.57
Portfolio turnover rate		12	2		16			13			16			13			39
Net assets, end of period ($ x 1,000,000)		105			94			70			53			37			17

* Unaudited.

¹ Amount less than $0.01.

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.

See financial notes 25

 Schwab Target 2015 Fund

Portfolio Holdings as of April 30, 2014 (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		86,971,361		101,613,651
	3	.1%	Short-Term Investments		3,231,110		3,231,110
	99	.9%	Total Investments		90,202,471		104,844,761
	0	.1%	Other Assets and Liabilities, Net				100,551
	100	.0%	Net Assets				104,945,312

	Number		Value
Security	of Shares		($)
Other Investment Companies 96.8% of net assets
Equity Funds 44.3%
Global Real Estate 2.2%
Schwab Global Real Estate Fund (a)		328,870		2,275,782
International 9.1%
American Century International Growth Fund, Institutional Shares		149,362		2,007,422
Laudus International MarketMasters Fund, Select Shares (a)		156,292		3,780,701
Laudus Mondrian Emerging Markets Fund, Institutional Shares (a)		9,465		83,763
Laudus Mondrian International Equity Fund, Institutional Shares (a)		173,371		1,555,139
William Blair International Small Cap Growth Fund, Institutional Shares		133,833		2,150,696
				9,577,721
Large-Cap 28.9%
Laudus U.S. Large Cap Growth Fund *(a)		418,417		7,431,093
Schwab Core Equity Fund (a)		323,360		7,569,854
Schwab Dividend Equity Fund (a)		221,944		4,041,599
Schwab S&P 500 Index Fund (a)		245,441		7,257,684
TCW Relative Value Large Cap Fund		193,388		4,074,686
				30,374,916
Small-Cap 4.1%
Laudus Small-Cap MarketMasters Fund, Select Shares *(a)		84,865		1,499,558
Schwab Small-Cap Equity Fund (a)		115,809		2,787,521
				4,287,079
				46,515,498
Fixed-Income Funds 49.9%
Inflation-Protected Bond 4.6%
Schwab Treasury Inflation Protected Securities Index Fund (a)		430,889		4,830,268
Intermediate-Term Bond 31.3%
Natixis Loomis Sayles Investment Grade Bond Fund, Class Y Shares		270,682		3,326,680
PIMCO Total Return Fund, Institutional Shares		643,548		6,976,059
Schwab Intermediate-Term Bond Fund (a)		319,949		3,260,280
Schwab Total Bond Market Fund (a)		2,050,964		19,340,594
				32,903,613
International Bond 0.8%
Laudus Mondrian International Government Fixed Income Fund *(a)		75,827		834,857
Short-Term Bond 13.2%
Schwab Short-Term Bond Market Fund (a)		1,491,128		13,837,668
				52,406,406
Money Market Fund 2.6%
Schwab Value Advantage Money Fund, Institutional Prime Shares 0.01% (a)(b)		2,691,747		2,691,747
Total Other Investment Companies
(Cost $86,971,361)				101,613,651
	Face
Security	Amount		Value
��  Rate, Maturity Date	($)		($)
Short-Term Investments 3.1% of net assets
Time Deposits 3.1%
ANZ
0.03%, 05/01/14		3,130,824		3,130,824
Bank of Tokyo Mitsubishi
0.03%, 05/01/14		100,286		100,286
Total Short-Term Investments
(Cost $3,231,110)				3,231,110
End of Investments.

At 04/30/14, the tax basis cost of the fund’s investments was $90,717,943 and the unrealized appreciation and depreciation were $14,254,874 and ($128,056), respectively, with a net unrealized appreciation of $14,126,818.

*	Non-income producing security.
(a)	Issuer is affiliated with the fund’s adviser.
(b)	The rate shown is the 7-day yield.

26 See financial notes

 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, 2014 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Other Significant		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Other Investment Companies1		$101,613,651		$—		$—		$101,613,651
Short-Term Investments1		—		3,231,110		—		3,231,110
Total		$101,613,651		$3,231,110		$—		$104,844,761

¹ As categorized in portfolio holdings.

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, 2014.

See financial notes 27

 Schwab Target 2015 Fund

Statement of

Assets and Liabilities

As of April 30, 2014; unaudited

Assets
Investments in affiliated underlying funds, at value (cost $70,862,015)		$83,078,108
Investments in unaffiliated issuers, at value (cost $19,340,456)	+	21,766,653
Total investments, at value (cost $90,202,471)		104,844,761
Receivables:
Investments sold		360,000
Fund shares sold		278,551
Dividends		64,635
Due from investment adviser		767
Interest		3
Prepaid expenses	+	530
Total assets		105,549,247
Liabilities
Payables:
Investments bought		574,631
Fund shares redeemed		10,198
Accrued expenses	+	19,106
Total liabilities		603,935
Net Assets
Total assets		105,549,247
Total liabilities	−	603,935
Net assets		$104,945,312
Net Assets by Source
Capital received from investors		87,137,147
Net investment income not yet distributed		81,119
Net realized capital gains		3,084,756
Net unrealized capital appreciation		14,642,290
Net Asset Value (NAV)

		Shares				��
Net Assets	÷	Outstanding	=	NAV
$104,945,312		8,446,357			$12.42

28 See financial notes

 Schwab Target 2015 Fund

Statement of

Operations

For the period November 1, 2013 through April 30, 2014; unaudited

Investment Income
Dividends received from affiliated underlying funds		$700,846
Dividends received from unaffiliated underlying funds		253,494
Interest	+	477
Total investment income		954,817
Expenses
Professional fees		18,139
Transfer agent fees		11,616
Registration fees		11,566
Portfolio accounting fees		4,830
Shareholder reports		4,073
Independent trustees’ fees		3,217
Custodian fees		2,861
Other expenses	+	1,293
Total expenses		57,595
Expense reduction by CSIM	−	57,595
Net expenses	−	—
Net investment income		954,817
Realized and Unrealized Gains (Losses)
Realized capital gain distributions received from affiliated underlying funds		1,502,331
Realized capital gain distributions received from unaffiliated underlying funds		261,211
Net realized gains on sales of affiliated underlying funds		1,694,310
Net realized gains on sales of unaffiliated underlying funds	+	177,398
Net realized gains		3,635,250
Net change in unrealized appreciation (depreciation) on affiliated underlying funds		(1,232,389	)
Net change in unrealized appreciation (depreciation) on unaffiliated underlying funds	+	(42,803	)
Net change in unrealized appreciation (depreciation)	+	(1,275,192	)
Net realized and unrealized gains		2,360,058
Increase in net assets resulting from operations		$3,314,875

See financial notes 29

 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

11/1/13-4/30/14				11/1/12-10/31/13
Net investment income		$954,817			$1,423,683
Net realized gains		3,635,250			485,759
Net change in unrealized appreciation (depreciation)	+	(1,275,192	)		7,360,842
Increase in net assets from operations		3,314,875			9,270,284
Distributions to Shareholders
Distributions from net investment income		($1,610,833	)		($1,464,548	)

Transactions in Fund Shares

		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		VALUE			SHARES		VALUE
Shares sold			1,678,276		$20,617,117			3,361,988		$39,062,080
Shares reinvested			125,055		1,526,926			126,443		1,398,455
Shares redeemed	+		(1,066,233	)	(13,100,361	)		(2,040,270	)	(23,734,773	)
Net transactions in fund shares			737,098		$9,043,682			1,448,161		$16,725,762
Shares Outstanding and Net Assets
		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			7,709,259		$94,197,588			6,261,098		$69,666,090
Total increase	+		737,098		10,747,724			1,448,161		24,531,498
End of period			8,446,357		$104,945,312			7,709,259		$94,197,588
Net investment income not yet distributed					$81,119					$737,135

30 See financial notes

Schwab Target 2020 Fund

Financial Statements

Financial Highlights

	11/1/13–			11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–
	4/30/14*			10/31/13			10/31/12			10/31/11			10/31/10			10/31/09
Per-Share Data ($)
Net asset value at beginning of period		13.52			11.94			11.13			10.80			9.63			8.59
Income (loss) from investment operations:
Net investment income (loss)		0.14			0.22			0.22			0.22			0.20			0.24
Net realized and unrealized gains (losses)		0.40			1.62			0.82			0.34			1.18			1.08
Total from investment operations		0.54			1.84			1.04			0.56			1.38			1.32
Less distributions:
Distributions from net investment income		(0.23	)		(0.26	)		(0.23	)		(0.23	)		(0.21	)		(0.28	)
Net asset value at end of period		13.83			13.52			11.94			11.13			10.80			9.63
Total return (%)		4.02	1		15.72			9.52			5.18			14.47			15.89
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses2		—	3		—			—			0.00	4		0.00	4		0.02	5
Gross operating expenses2		0.04	3		0.05			0.06			0.06			0.07			0.09
Net investment income (loss)		1.99	3		1.71			1.89			1.92			2.01			2.75
Portfolio turnover rate		8	1		14			13			15			15			48
Net assets, end of period ($ x 1,000,000)		466			415			306			273			240			198

* 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.

See financial notes 31

 Schwab Target 2020 Fund

Portfolio Holdings as of April 30, 2014 (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%	Other Investment Companies		360,220,337		451,821,930
	2	.8%	Short-Term Investment		13,195,290		13,195,290
	99	.8%	Total Investments		373,415,627		465,017,220
	0	.2%	Other Assets and Liabilities, Net				1,020,867
	100	.0%	Net Assets				466,038,087

	Number		Value
Security	of Shares		($)
Other Investment Companies 97.0% of net assets
Equity Funds 57.9%
Global Real Estate 2.9%
Schwab Global Real Estate Fund (a)		1,919,092		13,280,115
International 12.4%
American Century International Growth Fund, Institutional Shares		842,171		11,318,789
Laudus International MarketMasters Fund, Select Shares (a)		898,085		21,724,671
Laudus Mondrian Emerging Markets Fund, Institutional Shares (a)		315,938		2,796,051
Laudus Mondrian International Equity Fund, Institutional Shares (a)		1,058,118		9,491,319
William Blair International Small Cap Growth Fund, Institutional Shares		775,697		12,465,449
				57,796,279
Large-Cap 36.5%
Laudus U.S. Large Cap Growth Fund *(a)		2,352,891		41,787,341
Schwab Core Equity Fund (a)		1,851,944		43,354,022
Schwab Dividend Equity Fund (a)		1,221,975		22,252,161
Schwab S&P 500 Index Fund (a)		1,384,787		40,948,152
TCW Relative Value Large Cap Fund		1,028,292		21,666,105
				170,007,781
Small-Cap 6.1%
Laudus Small-Cap MarketMasters Fund, Select Shares *(a)		564,252		9,970,327
Schwab Small-Cap Equity Fund (a)		771,901		18,579,667
				28,549,994
				269,634,169
Fixed-Income Funds 38.0%
Inflation-Protected Bond 3.1%
Schwab Treasury Inflation Protected Securities Index Fund (a)		1,307,452		14,656,537
Intermediate-Term Bond 26.0%
Natixis Loomis Sayles Investment Grade Bond Fund, Class Y Shares		1,312,114		16,125,883
PIMCO Total Return Fund, Institutional Shares		3,116,576		33,783,680
Schwab Intermediate-Term Bond Fund (a)		1,374,965		14,010,891
Schwab Total Bond Market Fund (a)		6,051,007		57,060,999
				120,981,453
International Bond 1.1%
Laudus Mondrian International Government Fixed Income Fund *(a)		466,383		5,134,874
Short-Term Bond 7.8%
Schwab Short-Term Bond Market Fund (a)		3,924,000		36,414,723
				177,187,587
Money Market Fund 1.1%
Schwab Value Advantage Money Fund, Institutional Prime Shares 0.01% (a)(b)		5,000,174		5,000,174
Total Other Investment Companies
(Cost $360,220,337)				451,821,930
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investment 2.8% of net assets
Time Deposit 2.8%
Bank of Tokyo Mitsubishi
0.03%, 05/01/14		13,195,290		13,195,290
Total Short-Term Investment
(Cost $13,195,290)				13,195,290
End of Investments.

At 04/30/14, the tax basis cost of the fund’s investments was $375,830,083 and the unrealized appreciation and depreciation were $89,751,225 and ($564,088), respectively, with a net unrealized appreciation of $89,187,137.

*	Non-income producing security.
(a)	Issuer is affiliated with the fund’s adviser.
(b)	The rate shown is the 7-day yield.

32 See financial notes

 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, 2014 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Other Significant		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Other Investment Companies1		$451,821,930		$—		$—		$451,821,930
Short-Term Investment1		—		13,195,290		—		13,195,290
Total		$451,821,930		$13,195,290		$—		$465,017,220

¹ As categorized in portfolio holdings.

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, 2014.

See financial notes 33

 Schwab Target 2020 Fund

Statement of

Assets and Liabilities

As of April 30, 2014; unaudited

Assets
Investments in affiliated underlying funds, at value (cost $280,159,687)		$356,462,024
Investments in unaffiliated issuers, at value (cost $93,255,940)	+	108,555,196
Total investments, at value (cost $373,415,627)		465,017,220
Receivables:
Investments sold		2,930,000
Fund shares sold		784,918
Dividends		218,047
Due from investment adviser		1,326
Interest		11
Prepaid expenses	+	3,797
Total assets		468,955,319
Liabilities
Payables:
Investments bought		2,837,885
Fund shares redeemed		44,767
Accrued expenses	+	34,580
Total liabilities		2,917,232
Net Assets
Total assets		468,955,319
Total liabilities	−	2,917,232
Net assets		$466,038,087
Net Assets by Source
Capital received from investors		395,116,335
Distributions in excess of net investment income		(97,865	)
Net realized capital losses		(20,581,976	)
Net unrealized capital appreciation		91,601,593
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$466,038,087		33,687,572			$13.83

34 See financial notes

 Schwab Target 2020 Fund

Statement of

Operations

For the period November 1, 2013 through April 30, 2014; unaudited

Investment Income
Dividends received from affiliated underlying funds		$3,070,651
Dividends received from unaffiliated underlying funds		1,282,013
Interest	+	2,216
Total investment income		4,354,880
Expenses
Professional fees		19,821
Registration fees		19,678
Transfer agent fees		14,205
Shareholder reports		13,422
Portfolio accounting fees		11,598
Custodian fees		5,404
Independent trustees’ fees		4,028
Other expenses	+	4,067
Total expenses		92,223
Expense reduction by CSIM	−	92,223
Net expenses	−	—
Net investment income		4,354,880
Realized and Unrealized Gains (Losses)
Realized capital gain distributions received from affiliated underlying funds		8,350,952
Realized capital gain distributions received from unaffiliated underlying funds		1,318,314
Net realized gains on sales of affiliated underlying funds		6,521,784
Net realized gains on sales of unaffiliated underlying funds	+	820,669
Net realized gains		17,011,719
Net change in unrealized appreciation (depreciation) on affiliated underlying funds		(4,062,050	)
Net change in unrealized appreciation (depreciation) on unaffiliated underlying funds	+	(34,866	)
Net change in unrealized appreciation (depreciation)	+	(4,096,916	)
Net realized and unrealized gains		12,914,803
Increase in net assets resulting from operations		$17,269,683

See financial notes 35

 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

11/1/13-4/30/14				11/1/12-10/31/13
Net investment income		$4,354,880			$6,102,847
Net realized gains		17,011,719			2,458,347
Net change in unrealized appreciation (depreciation)	+	(4,096,916	)		43,123,487
Increase in net assets from operations		17,269,683			51,684,681
Distributions to Shareholders
Distributions from net investment income		($7,213,636	)		($6,683,111	)

Transactions in Fund Shares

		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		VALUE			SHARES		VALUE
Shares sold			4,958,497		$67,724,468			9,795,603		$124,307,451
Shares reinvested			510,642		6,944,736			542,153		6,451,623
Shares redeemed	+		(2,430,672	)	(33,209,465	)		(5,276,854	)	(66,887,924	)
Net transactions in fund shares			3,038,467		$41,459,739			5,060,902		$63,871,150
Shares Outstanding and Net Assets
		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			30,649,105		$414,522,301			25,588,203		$305,649,581
Total increase	+		3,038,467		51,515,786			5,060,902		108,872,720
End of period			33,687,572		$466,038,087			30,649,105		$414,522,301
Distributions in excess of net investment income/Net investment income not yet distributed					($97,865	)				$2,760,891

36 See financial notes

Schwab Target 2025 Fund

Financial Statements

Financial Highlights

	11/1/13–			11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–
	4/30/14*			10/31/13			10/31/12			10/31/11			10/31/10			10/31/09
Per-Share Data ($)
Net asset value at beginning of period		13.63			11.73			10.84			10.46			9.21			7.99
Income (loss) from investment operations:
Net investment income (loss)		0.14			0.21			0.19			0.19			0.16			0.17
Net realized and unrealized gains (losses)		0.47			1.93			0.89			0.38			1.24			1.21
Total from investment operations		0.61			2.14			1.08			0.57			1.40			1.38
Less distributions:
Distributions from net investment income		(0.23	)		(0.24	)		(0.19	)		(0.19	)		(0.15	)		(0.16	)
Net asset value at end of period		14.01			13.63			11.73			10.84			10.46			9.21
Total return (%)		4.49	1		18.54			10.14			5.44			15.34			17.61
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses2		—	3		—			0.00	4		—			0.00	4		0.01	5
Gross operating expenses2		0.06	3		0.08			0.10			0.14			0.24			0.57
Net investment income (loss)		2.00	3		1.57			1.73			1.66			1.62			2.15
Portfolio turnover rate		7	1		10			13			9			13			44
Net assets, end of period ($ x 1,000,000)		300			251			141			104			63			26

* 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.

See financial notes 37

 Schwab Target 2025 Fund

Portfolio Holdings as of April 30, 2014 (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		242,019,018		290,755,077
	3	.0%	Short-Term Investments		9,187,282		9,187,282
	99	.9%	Total Investments		251,206,300		299,942,359
	0	.1%	Other Assets and Liabilities, Net				192,061
	100	.0%	Net Assets				300,134,420

	Number		Value
Security	of Shares		($)
Other Investment Companies 96.9% of net assets
Equity Funds 67.8%
Global Real Estate 3.3%
Schwab Global Real Estate Fund (a)		1,451,757		10,046,157
International 15.0%
American Century International Growth Fund, Institutional Shares		634,868		8,532,632
Laudus International MarketMasters Fund, Select Shares (a)		679,432		16,435,465
Laudus Mondrian Emerging Markets Fund, Institutional Shares (a)		380,190		3,364,684
Laudus Mondrian International Equity Fund, Institutional Shares (a)		819,513		7,351,034
William Blair International Small Cap Growth Fund, Institutional Shares		572,331		9,197,354
				44,881,169
Large-Cap 41.7%
Laudus U.S. Large Cap Growth Fund *(a)		1,734,585		30,806,221
Schwab Core Equity Fund (a)		1,375,149		32,192,243
Schwab Dividend Equity Fund (a)		896,429		16,323,965
Schwab S&P 500 Index Fund (a)		1,015,605		30,031,433
TCW Relative Value Large Cap Fund		746,886		15,736,890
				125,090,752
Small-Cap 7.8%
Laudus Small-Cap MarketMasters Fund, Select Shares *(a)		465,284		8,221,565
Schwab Small-Cap Equity Fund (a)		636,399		15,318,136
				23,539,701
				203,557,779
Fixed-Income Funds 29.1%
Inflation-Protected Bond 2.2%
Schwab Treasury Inflation Protected Securities Index Fund (a)		583,238		6,538,102
Intermediate-Term Bond 21.0%
Natixis Loomis Sayles Investment Grade Bond Fund, Class Y Shares		818,815		10,063,233
PIMCO Total Return Fund, Institutional Shares		1,892,193		20,511,374
Schwab Intermediate-Term Bond Fund (a)		766,117		7,806,737
Schwab Total Bond Market Fund (a)		2,599,881		24,516,876
				62,898,220
International Bond 1.0%
Laudus Mondrian International Government Fixed Income Fund *(a)		277,619		3,056,588
Short-Term Bond 4.9%
Schwab Short-Term Bond Market Fund (a)		1,584,525		14,704,388
				87,197,298
Total Other Investment Companies
(Cost $242,019,018)				290,755,077
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 3.0% of net assets
Time Deposits 3.0%
Citibank
0.03%, 05/01/14		225,944		225,944
DNB
0.03%, 05/01/14		8,961,338		8,961,338
Total Short-Term Investments
(Cost $9,187,282)				9,187,282
End of Investments.

At 04/30/14, the tax basis cost of the fund’s investments was $252,384,674 and the unrealized appreciation and depreciation were $48,210,551 and ($652,866), respectively, with a net unrealized appreciation of $47,557,685.

*	Non-income producing security.
(a)	Issuer is affiliated with the fund’s adviser.

38 See financial notes

 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, 2014 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Other Significant		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Other Investment Companies1		$290,755,077		$—		$—		$290,755,077
Short-Term Investments1		—		9,187,282		—		9,187,282
Total		$290,755,077		$9,187,282		$—		$299,942,359

¹ As categorized in portfolio holdings.

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, 2014.

See financial notes 39

 Schwab Target 2025 Fund

Statement of

Assets and Liabilities

As of April 30, 2014; unaudited

Assets
Investments in affiliated underlying funds, at value (cost $185,641,209)		$226,713,594
Investments in unaffiliated issuers, at value (cost $65,565,091)	+	73,228,765
Total investments, at value (cost $251,206,300)		299,942,359
Receivables:
Investments sold		1,370,000
Fund shares sold		519,739
Dividends		106,499
Due from investment adviser		1,142
Interest		8
Prepaid expenses	+	978
Total assets		301,940,725
Liabilities
Payables:
Investments bought		1,756,376
Fund shares redeemed		33,284
Accrued expenses	+	16,645
Total liabilities		1,806,305
Net Assets
Total assets		301,940,725
Total liabilities	−	1,806,305
Net assets		$300,134,420
Net Assets by Source
Capital received from investors		244,752,225
Distributions in excess of net investment income		(268,385	)
Net realized capital gains		6,914,521
Net unrealized capital appreciation		48,736,059
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$300,134,420		21,429,807			$14.01

40 See financial notes

 Schwab Target 2025 Fund

Statement of

Operations

For the period November 1, 2013 through April 30, 2014; unaudited

Investment Income
Dividends received from affiliated underlying funds		$1,912,384
Dividends received from unaffiliated underlying funds		829,735
Interest	+	1,279
Total investment income		2,743,398
Expenses
Professional fees		18,879
Registration fees		18,165
Transfer agent fees		12,921
Portfolio accounting fees		9,986
Shareholder reports		7,249
Custodian fees		4,953
Independent trustees’ fees		3,612
Other expenses	+	2,491
Total expenses		78,256
Expense reduction by CSIM	−	78,256
Net expenses	−	—
Net investment income		2,743,398
Realized and Unrealized Gains (Losses)
Realized capital gain distributions received from affiliated underlying funds		5,901,906
Realized capital gain distributions received from unaffiliated underlying funds		856,699
Net realized gains on sales of affiliated underlying funds		1,508,686
Net realized gains on sales of unaffiliated underlying funds	+	242,542
Net realized gains		8,509,833
Net change in unrealized appreciation (depreciation) on affiliated underlying funds		380,685
Net change in unrealized appreciation (depreciation) on unaffiliated underlying funds	+	372,917
Net change in unrealized appreciation (depreciation)	+	753,602
Net realized and unrealized gains		9,263,435
Increase in net assets resulting from operations		$12,006,833

See financial notes 41

 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

11/1/13-4/30/14				11/1/12-10/31/13
Net investment income		$2,743,398			$3,022,858
Net realized gains		8,509,833			522,126
Net change in unrealized appreciation (depreciation)	+	753,602			28,887,950
Increase in net assets from operations		12,006,833			32,432,934
Distributions to Shareholders
Distributions from net investment income		($4,339,215	)		($2,993,027	)

Transactions in Fund Shares

		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		VALUE			SHARES		VALUE
Shares sold			4,430,312		$61,135,462			8,685,243		$109,893,079
Shares reinvested			308,192		4,243,806			248,579		2,915,831
Shares redeemed	+		(1,764,323	)	(24,403,523	)		(2,529,490	)	(32,070,753	)
Net transactions in fund shares			2,974,181		$40,975,745			6,404,332		$80,738,157
Shares Outstanding and Net Assets
		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			18,455,626		$251,491,057			12,051,294		$141,312,993
Total increase	+		2,974,181		48,643,363			6,404,332		110,178,064
End of period			21,429,807		$300,134,420			18,455,626		$251,491,057
Distributions in excess of net investment income/Net investment income not yet distributed					($268,385	)				$1,327,432

42 See financial notes

Schwab Target 2030 Fund

Financial Statements

Financial Highlights

	11/1/13–			11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–
	4/30/14*			10/31/13			10/31/12			10/31/11			10/31/10			10/31/09
Per-Share Data ($)
Net asset value at beginning of period		14.70			12.42			11.43			11.05			9.69			8.51
Income (loss) from investment operations:
Net investment income (loss)		0.16			0.22			0.19			0.19			0.17			0.20
Net realized and unrealized gains (losses)		0.54			2.31			0.99			0.38			1.36			1.23
Total from investment operations		0.70			2.53			1.18			0.57			1.53			1.43
Less distributions:
Distributions from net investment income		(0.25	)		(0.25	)		(0.19	)		(0.19	)		(0.17	)		(0.25	)
Net asset value at end of period		15.15			14.70			12.42			11.43			11.05			9.69
Total return (%)		4.82	1		20.73			10.52			5.20			15.97			17.31
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses2		—	3		—			—			—			0.00	4		0.01	5
Gross operating expenses2		0.03	3		0.04			0.05			0.05			0.08			0.11
Net investment income (loss)		2.06	3		1.59			1.62			1.60			1.64			2.37
Portfolio turnover rate		7	1		10			12			8			14			50
Net assets, end of period ($ x 1,000,000)		682			621			444			372			296			200

* 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.

See financial notes 43

 Schwab Target 2030 Fund

Portfolio Holdings as of April 30, 2014 (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		495,010,065		664,614,367
	2	.5%	Short-Term Investment		16,973,589		16,973,589
	99	.9%	Total Investments		511,983,654		681,587,956
	0	.1%	Other Assets and Liabilities, Net				518,251
	100	.0%	Net Assets				682,106,207

	Number		Value
Security	of Shares		($)
Other Investment Companies 97.4% of net assets
Equity Funds 75.7%
Global Real Estate 3.8%
Schwab Global Real Estate Fund (a)		3,689,899		25,534,102
International 17.1%
American Century International Growth Fund, Institutional Shares		1,595,542		21,444,082
Laudus International MarketMasters Fund, Select Shares (a)		1,717,518		41,546,772
Laudus Mondrian Emerging Markets Fund, Institutional Shares (a)		1,292,566		11,439,211
Laudus Mondrian International Equity Fund, Institutional Shares (a)		2,094,246		18,785,385
William Blair International Small Cap Growth Fund, Institutional Shares		1,458,238		23,433,888
				116,649,338
Large-Cap 45.5%
Laudus U.S. Large Cap Growth Fund *(a)		4,313,771		76,612,567
Schwab Core Equity Fund (a)		3,430,484		80,307,629
Schwab Dividend Equity Fund (a)		2,219,505		40,417,178
Schwab S&P 500 Index Fund (a)		2,448,130		72,391,211
TCW Relative Value Large Cap Fund		1,938,233		40,838,578
				310,567,163
Small-Cap 9.3%
Laudus Small-Cap MarketMasters Fund, Select Shares *(a)		1,256,024		22,193,952
Schwab Small-Cap Equity Fund (a)		1,718,791		41,371,310
				63,565,262
				516,315,865
Fixed-Income Funds 21.7%
Inflation-Protected Bond 1.6%
Schwab Treasury Inflation Protected Securities Index Fund (a)		997,761		11,184,900
Intermediate-Term Bond 16.3%
Natixis Loomis Sayles Investment Grade Bond Fund, Class Y Shares		1,691,972		20,794,333
PIMCO Total Return Fund, Institutional Shares		3,608,321		39,114,204
Schwab Intermediate-Term Bond Fund (a)		1,407,770		14,345,179
Schwab Total Bond Market Fund (a)		3,879,424		36,582,970
				110,836,686
International Bond 0.8%
Laudus Mondrian International Government Fixed Income Fund *(a)		506,593		5,577,590
Short-Term Bond 3.0%
Schwab Short-Term Bond Market Fund (a)		2,230,531		20,699,326
				148,298,502
Total Other Investment Companies
(Cost $495,010,065)				664,614,367
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investment 2.5% of net assets
Time Deposit 2.5%
DNB
0.03%, 05/01/14		16,973,589		16,973,589
Total Short-Term Investment
(Cost $16,973,589)				16,973,589
End of Investments.

At 04/30/14, the tax basis cost of the fund’s investments was $ 516,124,425 and the unrealized appreciation and depreciation were $166,843,389 and ($1,379,858), respectively, with a net unrealized appreciation of $165,463,531.

*	Non-income producing security.
(a)	Issuer is affiliated with the fund’s adviser.

44 See financial notes

 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, 2014 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Other Significant		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Other Investment Companies1		$664,614,367		$—		$—		$664,614,367
Short-Term Investment1		—		16,973,589		—		16,973,589
Total		$664,614,367		$16,973,589		$—		$681,587,956

¹ As categorized in portfolio holdings.

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, 2014.

See financial notes 45

 Schwab Target 2030 Fund

Statement of

Assets and Liabilities

As of April 30, 2014; unaudited

Assets
Investments in affiliated underlying funds, at value (cost $375,673,765)		$518,989,282
Investments in unaffiliated issuers, at value (cost $136,309,889)	+	162,598,674
Total investments, at value (cost $511,983,654)		681,587,956
Receivables:
Investments sold		4,250,000
Fund shares sold		1,414,250
Dividends		179,146
Due from investment adviser		1,481
Interest		14
Prepaid expenses	+	4,403
Total assets		687,437,250
Liabilities
Payables:
Investments bought		5,188,867
Fund shares redeemed		101,246
Accrued expenses	+	40,930
Total liabilities		5,331,043
Net Assets
Total assets		687,437,250
Total liabilities	−	5,331,043
Net assets		$682,106,207
Net Assets by Source
Capital received from investors		521,831,766
Distributions in excess of net investment income		(1,210,759	)
Net realized capital losses		(8,119,102	)
Net unrealized capital appreciation		169,604,302
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$682,106,207		45,012,933			$15.15

46 See financial notes

 Schwab Target 2030 Fund

Statement of

Operations

For the period November 1, 2013 through April 30, 2014; unaudited

Investment Income
Dividends received from affiliated underlying funds		$4,716,780
Dividends received from unaffiliated underlying funds		1,971,597
Interest	+	2,571
Total investment income		6,690,948
Expenses
Professional fees		20,924
Shareholder reports		20,503
Registration fees		18,057
Transfer agent fees		14,710
Portfolio accounting fees		13,562
Custodian fees		7,189
Independent trustees’ fees		4,550
Other expenses	+	5,762
Total expenses		105,257
Expense reduction by CSIM	−	105,257
Net expenses	−	—
Net investment income		6,690,948
Realized and Unrealized Gains (Losses)
Realized capital gain distributions received from affiliated underlying funds		16,080,048
Realized capital gain distributions received from unaffiliated underlying funds		2,095,580
Net realized gains on sales of affiliated underlying funds		5,207,895
Net realized gains on sales of unaffiliated underlying funds	+	1,130,878
Net realized gains		24,514,401
Net change in unrealized appreciation (depreciation) on affiliated underlying funds		(1,116,984	)
Net change in unrealized appreciation (depreciation) on unaffiliated underlying funds	+	539,359
Net change in unrealized appreciation (depreciation)	+	(577,625	)
Net realized and unrealized gains		23,936,776
Increase in net assets resulting from operations		$30,627,724

See financial notes 47

 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

11/1/13-4/30/14				11/1/12-10/31/13
Net investment income		$6,690,948			$8,355,081
Net realized gains		24,514,401			2,555,290
Net change in unrealized appreciation (depreciation)	+	(577,625	)		88,069,955
Increase in net assets from operations		30,627,724			98,980,326
Distributions to Shareholders
Distributions from net investment income		($10,903,512	)		($9,003,665	)

Transactions in Fund Shares

		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		VALUE			SHARES		VALUE
Shares sold			5,096,930		$76,096,292			11,596,872		$156,363,209
Shares reinvested			710,161		10,588,500			703,372		8,749,953
Shares redeemed	+		(3,066,924	)	(45,776,721	)		(5,790,131	)	(77,672,946	)
Net transactions in fund shares			2,740,167		$40,908,071			6,510,113		$87,440,216
Shares Outstanding and Net Assets
		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			42,272,766		$621,473,924			35,762,653		$444,057,047
Total increase	+		2,740,167		60,632,283			6,510,113		177,416,877
End of period			45,012,933		$682,106,207			42,272,766		$621,473,924
Distributions in excess of net investment income/Net investment income not yet distributed					($1,210,759	)				$3,001,805

48 See financial notes

Schwab Target 2035 Fund

Financial Statements

Financial Highlights

	11/1/13–			11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–
	4/30/14*			10/31/13			10/31/12			10/31/11			10/31/10			10/31/09
Per-Share Data ($)
Net asset value at beginning of period		14.12			11.69			10.70			10.32			9.00			7.76
Income (loss) from investment operations:
Net investment income (loss)		0.15			0.20			0.16			0.16			0.13			0.15
Net realized and unrealized gains (losses)		0.57			2.45			0.99			0.38			1.33			1.23
Total from investment operations		0.72			2.65			1.15			0.54			1.46			1.38
Less distributions:
Distributions from net investment income		(0.24	)		(0.22	)		(0.16	)		(0.16	)		(0.14	)		(0.14	)
Net asset value at end of period		14.60			14.12			11.69			10.70			10.32			9.00
Total return (%)		5.09	1		23.02			10.89			5.27			16.29			18.22
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses2		—	3		—			—			—			0.00	4		0.01	5
Gross operating expenses2		0.07	3		0.09			0.13			0.17			0.30			0.67
Net investment income (loss)		2.03	3		1.42			1.45			1.41			1.38			1.92
Portfolio turnover rate		5	1		5			11			4			14			49
Net assets, end of period ($ x 1,000,000)		246			204			111			77			49			22

* 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.

See financial notes 49

 Schwab Target 2035 Fund

Portfolio Holdings as of April 30, 2014 (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		194,029,454		240,497,935
	2	.3%	Short-Term Investment		5,567,859		5,567,859
	99	.9%	Total Investments		199,597,313		246,065,794
	0	.1%	Other Assets and Liabilities, Net				234,710
	100	.0%	Net Assets				246,300,504

	Number		Value
Security	of Shares		($)
Other Investment Companies 97.6% of net assets
Equity Funds 82.6%
Global Real Estate 4.1%
Schwab Global Real Estate Fund (a)		1,455,447		10,071,697
International 19.0%
American Century International Growth Fund, Institutional Shares		625,907		8,412,188
Laudus International MarketMasters Fund, Select Shares (a)		675,626		16,343,392
Laudus Mondrian Emerging Markets Fund, Institutional Shares (a)		626,913		5,548,182
Laudus Mondrian International Equity Fund, Institutional Shares (a)		830,836		7,452,595
William Blair International Small Cap Growth Fund, Institutional Shares		567,289		9,116,336
				46,872,693
Large-Cap 48.8%
Laudus U.S. Large Cap Growth Fund *(a)		1,672,079		29,696,128
Schwab Core Equity Fund (a)		1,339,850		31,365,889
Schwab Dividend Equity Fund (a)		857,141		15,608,528
Schwab S&P 500 Index Fund (a)		955,490		28,253,831
TCW Relative Value Large Cap Fund		717,820		15,124,466
				120,048,842
Small-Cap 10.7%
Laudus Small-Cap MarketMasters Fund, Select Shares *(a)		521,456		9,214,126
Schwab Small-Cap Equity Fund (a)		713,262		17,168,220
				26,382,346
				203,375,578
Fixed-Income Funds 15.0%
Inflation-Protected Bond 1.0%
Schwab Treasury Inflation Protected Securities Index Fund (a)		220,700		2,474,042
Intermediate-Term Bond 11.6%
Natixis Loomis Sayles Investment Grade Bond Fund, Class Y Shares		483,653		5,944,097
PIMCO Total Return Fund, Institutional Shares		1,044,889		11,326,595
Schwab Intermediate-Term Bond Fund (a)		348,104		3,547,175
Schwab Total Bond Market Fund (a)		822,814		7,759,132
				28,576,999
International Bond 0.5%
Laudus Mondrian International Government Fixed Income Fund *(a)		114,688		1,262,712
Short-Term Bond 1.9%
Schwab Short-Term Bond Market Fund (a)		518,169		4,808,604
				37,122,357
Total Other Investment Companies
(Cost $194,029,454)				240,497,935
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investment 2.3% of net assets
Time Deposit 2.3%
Bank of Tokyo - Mitsubishi UFJ
0.03%, 05/01/14		5,567,859		5,567,859
Total Short-Term Investment
(Cost $5,567,859)				5,567,859
End of Investments.

At 04/30/14, the tax basis cost of the fund’s investments was $200,550,135 and the unrealized appreciation and depreciation were $45,918,517 and ($402,858), respectively, with a net unrealized appreciation of $45,515,659.

*	Non-income producing security.
(a)	Issuer is affiliated with the fund’s adviser.

50 See financial notes

 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, 2014 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Other Significant		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Other Investment Companies1		$240,497,935		$—		$—		$240,497,935
Short-Term Investment1		—		5,567,859		—		5,567,859
Total		$240,497,935		$5,567,859		$—		$246,065,794
					��

¹ As categorized in portfolio holdings.

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, 2014.

See financial notes 51

 Schwab Target 2035 Fund

Statement of

Assets and Liabilities

As of April 30, 2014; unaudited

Assets
Investments in affiliated underlying funds, at value (cost $151,509,313)		$190,574,253
Investments in unaffiliated issuers, at value (cost $48,088,000)	+	55,491,541
Total investments, at value (cost $199,597,313)		246,065,794
Receivables:
Investments sold		1,290,000
Fund shares sold		436,671
Dividends		44,365
Due from investment adviser		1,097
Interest		5
Prepaid expenses	+	752
Total assets		247,838,684
Liabilities
Payables:
Investments bought		1,479,279
Fund shares redeemed		38,828
Accrued expenses	+	20,073
Total liabilities		1,538,180
Net Assets
Total assets		247,838,684
Total liabilities	−	1,538,180
Net assets		$246,300,504
Net Assets by Source
Capital received from investors		193,909,707
Distributions in excess of net investment income		(528,945	)
Net realized capital gains		6,451,261
Net unrealized capital appreciation		46,468,481
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$246,300,504		16,867,468			$14.60

52 See financial notes

 Schwab Target 2035 Fund

Statement of

Operations

For the period November 1, 2013 through April 30, 2014; unaudited

Investment Income
Dividends received from affiliated underlying funds		$1,633,533
Dividends received from unaffiliated underlying funds		655,370
Interest	+	761
Total investment income		2,289,664
Expenses
Professional fees		18,637
Registration fees		16,908
Transfer agent fees		13,155
Shareholder reports		9,154
Portfolio accounting fees		8,251
Custodian fees		4,702
Independent trustees’ fees		3,495
Other expenses	+	2,085
Total expenses		76,387
Expense reduction by CSIM	−	76,387
Net expenses	−	—
Net investment income		2,289,664
Realized and Unrealized Gains (Losses)
Realized capital gain distributions received from affiliated underlying funds		5,874,688
Realized capital gain distributions received from unaffiliated underlying funds		704,175
Net realized gains on sales of affiliated underlying funds		970,954
Net realized gains on sales of unaffiliated underlying funds	+	202,611
Net realized gains		7,752,428
Net change in unrealized appreciation (depreciation) on affiliated underlying funds		695,080
Net change in unrealized appreciation (depreciation) on unaffiliated underlying funds	+	437,994
Net change in unrealized appreciation (depreciation)	+	1,133,074
Net realized and unrealized gains		8,885,502
Increase in net assets resulting from operations		$11,175,166

See financial notes 53

 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

11/1/13-4/30/14				11/1/12-10/31/13
Net investment income		$2,289,664			$2,173,386
Net realized gains		7,752,428			378,227
Net change in unrealized appreciation (depreciation)	+	1,133,074			28,953,150
Increase in net assets from operations		11,175,166			31,504,763
Distributions to Shareholders
Distributions from net investment income		($3,570,560	)		($2,151,560	)

Transactions in Fund Shares

		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		VALUE			SHARES		VALUE
Shares sold			3,274,956		$47,034,068			6,414,310		$82,496,975
Shares reinvested			242,410		3,485,859			178,770		2,102,339
Shares redeemed	+		(1,124,477	)	(16,134,825	)		(1,571,980	)	(20,151,520	)
Net transactions in fund shares			2,392,889		$34,385,102			5,021,100		$64,447,794
Shares Outstanding and Net Assets
		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			14,474,579		$204,310,796			9,453,479		$110,509,799
Total increase	+		2,392,889		41,989,708			5,021,100		93,800,997
End of period			16,867,468		$246,300,504			14,474,579		$204,310,796
Distributions in excess of net investment income/Net investment income not yet distributed					($528,945	)				$751,951

54 See financial notes

Schwab Target 2040 Fund

Financial Statements

Financial Highlights

	11/1/13–			11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–
	4/30/14*			10/31/13			10/31/12			10/31/11			10/31/10			10/31/09
Per-Share Data ($)
Net asset value at beginning of period		15.49			12.67			11.55			11.16			9.71			8.48
Income (loss) from investment operations:
Net investment income (loss)		0.17			0.22			0.17			0.17			0.15			0.18
Net realized and unrealized gains (losses)		0.66			2.84			1.12			0.40			1.46			1.27
Total from investment operations		0.83			3.06			1.29			0.57			1.61			1.45
Less distributions:
Distributions from net investment income		(0.26	)		(0.24	)		(0.17	)		(0.18	)		(0.16	)		(0.22	)
Net asset value at end of period		16.06			15.49			12.67			11.55			11.16			9.71
Total return (%)		5.41	1		24.55			11.33			5.08			16.71			17.66
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses2		—	3		—			—			—			0.00	4		0.00	4,5
Gross operating expenses2		0.04	3		0.04			0.06			0.06			0.10			0.15
Net investment income (loss)		2.06	3		1.47			1.42			1.42			1.44			2.15
Portfolio turnover rate		5	1		6			12			3			15			51
Net assets, end of period ($ x 1,000,000)		712			639			435			342			259			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.

See financial notes 55

 Schwab Target 2040 Fund

Portfolio Holdings as of April 30, 2014 (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		506,820,093		697,165,917
	2	.1%	Short-Term Investment		14,696,182		14,696,182
	100	.0%	Total Investments		521,516,275		711,862,099
	(0	.0%)	Other Assets and Liabilities, Net				(6,511	)
	100	.0%	Net Assets				711,855,588

	Number		Value
Security	of Shares		($)
Other Investment Companies 97.9% of net assets
Equity Funds 88.3%
Global Real Estate 4.4%
Schwab Global Real Estate Fund (a)		4,503,457		31,163,925
International 20.7%
American Century International Growth Fund, Institutional Shares		1,929,019		25,926,017
Laudus International MarketMasters Fund, Select Shares (a)		2,085,470		50,447,527
Laudus Mondrian Emerging Markets Fund, Institutional Shares (a)		2,221,864		19,663,498
Laudus Mondrian International Equity Fund, Institutional Shares (a)		2,581,683		23,157,693
William Blair International Small Cap Growth Fund, Institutional Shares		1,756,611		28,228,733
				147,423,468
Large-Cap 51.3%
Laudus U.S. Large Cap Growth Fund *(a)		5,084,405		90,299,040
Schwab Core Equity Fund (a)		4,065,031		95,162,367
Schwab Dividend Equity Fund (a)		2,590,855		47,179,478
Schwab S&P 500 Index Fund (a)		2,867,063		84,779,043
TCW Relative Value Large Cap Fund		2,270,060		47,830,169
				365,250,097
Small-Cap 11.9%
Laudus Small-Cap MarketMasters Fund, Select Shares *(a)		1,677,426		29,640,125
Schwab Small-Cap Equity Fund (a)		2,295,437		55,251,163
				84,891,288
				628,728,778
Fixed-Income Funds 9.6%
Inflation-Protected Bond 0.5%
Schwab Treasury Inflation Protected Securities Index Fund (a)		337,349		3,781,682
Intermediate-Term Bond 7.5%
Natixis Loomis Sayles Investment Grade Bond Fund, Class Y Shares		1,127,975		13,862,811
PIMCO Total Return Fund, Institutional Shares		2,229,914		24,172,266
Schwab Intermediate-Term Bond Fund (a)		628,459		6,403,996
Schwab Total Bond Market Fund (a)		990,560		9,340,978
				53,780,051
International Bond 0.2%
Laudus Mondrian International Government Fixed Income Fund *(a)		102,247		1,125,736
Short-Term Bond 1.4%
Schwab Short-Term Bond Market Fund (a)		1,050,611		9,749,670
				68,437,139
Total Other Investment Companies
(Cost $506,820,093)				697,165,917
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investment 2.1% of net assets
Time Deposit 2.1%
DNB
0.03%, 05/01/14		14,696,182		14,696,182
Total Short-Term Investment
(Cost $14,696,182)				14,696,182
End of Investments.

At 04/30/14, the tax basis cost of the fund’s investments was $525,932,806 and the unrealized appreciation and depreciation were $186,773,312 and ($844,019), respectively, with a net unrealized appreciation of $185,929,293.

*	Non-income producing security.
(a)	Issuer is affiliated with the fund’s adviser.

56 See financial notes

 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, 2014 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Other Significant		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Other Investment Companies1		$697,165,917		$—		$—		$697,165,917
Short-Term Investment1		—		14,696,182		—		14,696,182
Total		$697,165,917		$14,696,182		$—		$711,862,099

¹ As categorized in portfolio holdings.

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, 2014.

See financial notes 57

 Schwab Target 2040 Fund

Statement of

Assets and Liabilities

As of April 30, 2014; unaudited

Assets
Investments in affiliated underlying funds, at value (cost $397,408,327)		$557,145,921
Investments in unaffiliated issuers, at value (cost $124,107,948)	+	154,716,178
Total investments, at value (cost $521,516,275)		711,862,099
Receivables:
Investments sold		3,910,000
Fund shares sold		704,467
Dividends		78,703
Due from investment adviser		1,773
Interest		12
Prepaid expenses	+	3,940
Total assets		716,560,994
Liabilities
Payables:
Investments bought		4,418,495
Fund shares redeemed		236,129
Accrued expenses	+	50,782
Total liabilities		4,705,406
Net Assets
Total assets		716,560,994
Total liabilities	−	4,705,406
Net assets		$711,855,588
Net Assets by Source
Capital received from investors		526,113,671
Distributions in excess of net investment income		(2,030,975	)
Net realized capital losses		(2,572,932	)
Net unrealized capital appreciation		190,345,824
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$711,855,588		44,336,354			$16.06

58 See financial notes

 Schwab Target 2040 Fund

Statement of

Operations

For the period November 1, 2013 through April 30, 2014; unaudited

Investment Income
Dividends received from affiliated underlying funds		$5,034,445
Dividends received from unaffiliated underlying funds		1,890,810
Interest	+	2,142
Total investment income		6,927,397
Expenses
Shareholder reports		34,914
Professional fees		20,954
Transfer agent fees		19,055
Registration fees		18,819
Portfolio accounting fees		13,761
Custodian fees		7,219
Independent trustees’ fees		4,605
Other expenses	+	5,942
Total expenses		125,269
Expense reduction by CSIM	−	125,269
Net expenses	−	—
Net investment income		6,927,397
Realized and Unrealized Gains (Losses)
Realized capital gain distributions received from affiliated underlying funds		19,073,215
Realized capital gain distributions received from unaffiliated underlying funds		2,091,205
Net realized gains on sales of affiliated underlying funds		2,462,817
Net realized gains on sales of unaffiliated underlying funds	+	521,011
Net realized gains		24,148,248
Net change in unrealized appreciation (depreciation) on affiliated underlying funds		2,418,659
Net change in unrealized appreciation (depreciation) on unaffiliated underlying funds	+	1,561,197
Net change in unrealized appreciation (depreciation)	+	3,979,856
Net realized and unrealized gains		28,128,104
Increase in net assets resulting from operations		$35,055,501

See financial notes 59

 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

11/1/13-4/30/14				11/1/12-10/31/13
Net investment income		$6,927,397			$7,852,541
Net realized gains		24,148,248			1,785,300
Net change in unrealized appreciation (depreciation)	+	3,979,856			107,182,294
Increase in net assets from operations		35,055,501			116,820,135
Distributions to Shareholders
Distributions from net investment income		($11,083,321	)		($8,424,619	)

Transactions in Fund Shares

		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		VALUE			SHARES		VALUE
Shares sold			5,460,348		$86,316,399			11,808,472		$164,760,752
Shares reinvested			684,108		10,822,584			647,209		8,251,913
Shares redeemed	+		(3,086,240	)	(48,697,416	)		(5,499,831	)	(76,790,642	)
Net transactions in fund shares			3,058,216		$48,441,567			6,955,850		$96,222,023
Shares Outstanding and Net Assets
		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			41,278,138		$639,441,841			34,322,288		$434,824,302
Total increase	+		3,058,216		72,413,747			6,955,850		204,617,539
End of period			44,336,354		$711,855,588			41,278,138		$639,441,841
Distributions in excess of net investment income/Net investment income not yet distributed					($2,030,975	)				$2,124,949

60 See financial notes

Schwab Target 2045 Fund

Financial Statements

Financial Highlights

	11/1/13–			1/23/131–
	4/30/14*			10/31/13
Per-Share Data ($)
Net asset value at beginning of period		11.66			10.00
Income (loss) from investment operations:
Net investment income (loss)		0.13			0.02
Net realized and unrealized gains (losses)		0.51			1.64
Total from investment operations		0.64			1.66
Less distributions:
Distributions from net investment income		(0.18	)		—
Net asset value at end of period		12.12			11.66
Total return (%)		5.51	2		16.60	2
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses3		—	4		0.00	4,5
Gross operating expenses3		0.40	4		1.08	4
Net investment income (loss)		1.89	4		0.46	4
Portfolio turnover rate		4	2		39	2
Net assets, end of period ($ x 1,000,000)		29			18

* 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.

See financial notes 61

 Schwab Target 2045 Fund

Portfolio Holdings as of April 30, 2014 (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		26,608,776		28,368,119
	2	.0%	Short-Term Investment		568,691		568,691
	99	.9%	Total Investments		27,177,467		28,936,810
	0	.1%	Other Assets and Liabilities, Net				28,959
	100	.0%	Net Assets				28,965,769

	Number		Value
Security	of Shares		($)
Other Investment Companies 97.9% of net assets
Equity Funds 91.5%
Global Real Estate 4.5%
Schwab Global Real Estate Fund (a)		189,802		1,313,428
International 21.7%
American Century International Growth Fund, Institutional Shares		81,089		1,089,835
Laudus International MarketMasters Fund, Select Shares (a)		87,753		2,122,751
Laudus Mondrian Emerging Markets Fund, Institutional Shares (a)		101,369		897,120
Laudus Mondrian International Equity Fund, Institutional Shares (a)		109,556		982,713
William Blair International Small Cap Growth Fund, Institutional Shares		73,826		1,186,386
				6,278,805
Large-Cap 52.7%
Laudus U.S. Large Cap Growth Fund *(a)		212,403		3,772,279
Schwab Core Equity Fund (a)		170,005		3,979,813
Schwab Dividend Equity Fund (a)		108,350		1,973,041
Schwab S&P 500 Index Fund (a)		120,677		3,568,427
TCW Relative Value Large Cap Fund		92,989		1,959,281
				15,252,841
Small-Cap 12.6%
Laudus Small-Cap MarketMasters Fund, Select Shares *(a)		72,227		1,276,252
Schwab Small-Cap Equity Fund (a)		98,844		2,379,186
				3,655,438
				26,500,512
Fixed-Income Funds 6.4%
Inflation-Protected Bond 0.3%
Schwab Treasury Inflation Protected Securities Index Fund (a)		7,221		80,951
Intermediate-Term Bond 5.0%
Natixis Loomis Sayles Investment Grade Bond Fund, Class Y Shares		38,647		474,972
PIMCO Total Return Fund, Institutional Shares		68,556		743,141
Schwab Intermediate-Term Bond Fund (a)		14,156		144,250
Schwab Total Bond Market Fund (a)		10,184		96,034
				1,458,397
International Bond 0.1%
Laudus Mondrian International Government Fixed Income Fund *(a)		3,558		39,177
Short-Term Bond 1.0%
Schwab Short-Term Bond Market Fund (a)		31,151		289,082
				1,867,607
Total Other Investment Companies
(Cost $26,608,776)				28,368,119
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investment 2.0% of net assets
Time Deposit 2.0%
Bank of Tokyo Mitsubishi
0.03%, 05/01/14		568,691		568,691
Total Short-Term Investment
(Cost $568,691)				568,691
End of Investments.

At 04/30/14, the tax basis cost of the fund’s investments was $27,206,242 and the unrealized appreciation and depreciation were $1,737,479 and ($6,911), respectively, with a net unrealized appreciation of $1,730,568.

*	Non-income producing security.
(a)	Issuer is affiliated with the fund’s adviser.

62 See financial notes

 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, 2014 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Other Significant		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Other Investment Companies1		$28,368,119		$—		$—		$28,368,119
Short-Term Investment1		—		568,691		—		568,691
Total		$28,368,119		$568,691		$—		$28,936,810

¹ As categorized in portfolio holdings.

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, 2014.

See financial notes 63

 Schwab Target 2045 Fund

Statement of

Assets and Liabilities

As of April 30, 2014; unaudited

Assets
Investments in affiliated issuers, at value (cost $21,470,199)		$22,914,504
Investments in unaffiliated issuers, at value (cost $5,707,268)	+	6,022,306
Total investments, at value (cost $27,177,467)		28,936,810
Receivables:
Investments sold		122,000
Fund shares sold		68,992
Dividends		1,914
Due from investment adviser		455
Prepaid expenses	+	8
Total assets		29,130,179
Liabilities
Payables:
Investments bought		142,907
Fund shares redeemed		1,684
Accrued expenses	+	19,819
Total liabilities		164,410
Net Assets
Total assets		29,130,179
Total liabilities	−	164,410
Net assets		$28,965,769
Net Assets by Source
Capital received from investors		26,672,384
Distributions in excess of net investment income		(63,840	)
Net realized capital gains		597,882
Net unrealized capital appreciation		1,759,343
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$28,965,769		2,390,648			$12.12

64 See financial notes

 Schwab Target 2045 Fund

Statement of

Operations

For the period November 1, 2013 through April 30, 2014; unaudited

Investment Income
Dividends received from affiliated underlying funds		$157,598
Dividends received from unaffiliated underlying funds		58,681
Interest	+	65
Total investment income		216,344
Expenses
Professional fees		16,268
Transfer agent fees		10,600
Registration fees		6,804
Custodian fees		4,455
Portfolio accounting fees		3,965
Independent trustees’ fees		2,975
Shareholder reports		393
Other expenses	+	536
Total expenses		45,996
Expense reduction by CSIM	−	45,996
Net expenses	−	—
Net investment income		216,344
Realized and Unrealized Gains (Losses)
Realized capital gain distributions received from affiliated underlying funds		589,442
Realized capital gain distributions received from unaffiliated underlying funds		63,234
Net realized losses on sales of affiliated underlying funds		(14,867	)
Net realized losses on sales of unaffiliated underlying funds	+	(2,204	)
Net realized gains		635,605
Net change in unrealized appreciation (depreciation) on affiliated underlying funds		260,162
Net change in unrealized appreciation (depreciation) on unaffiliated underlying funds	+	84,226
Net change in unrealized appreciation (depreciation)	+	344,388
Net realized and unrealized gains		979,993
Increase in net assets resulting from operations		$1,196,337

See financial notes 65

 Schwab Target 2045 Fund

Statement of

Changes in Net Assets

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

Operations

11/1/13-4/30/14				1/23/13*-10/31/13
Net investment income		$216,344			$32,174
Net realized gains (losses)		635,605			(37,723	)
Net change in unrealized appreciation (depreciation)	+	344,388			1,414,955
Increase in net assets from operations		1,196,337			1,409,406
Distributions to Shareholders
Distributions from net investment income		($312,358	)		$—

Transactions in Fund Shares

		11/1/13-4/30/14					1/23/13*-10/31/13
			SHARES		VALUE			SHARES		VALUE
Shares sold			1,030,031		$12,274,330			1,673,485		$17,999,978
Shares reinvested			25,653		306,297			—		—
Shares redeemed	+		(176,202	)	(2,121,764	)		(162,319	)	(1,786,457	)
Net transactions in fund shares			879,482		$10,458,863			1,511,166		$16,213,521
Shares Outstanding and Net Assets
		11/1/13-4/30/14					1/23/13*-10/31/13
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			1,511,166		$17,622,927			—		$—
Total increase	+		879,482		11,342,842			1,511,166		17,622,927
End of period			2,390,648		$28,965,769			1,511,166		$17,622,927
Distributions in excess of net investment income/Net investment income not yet distributed					($63,840	)				$32,174

* Commencement of operations.

66 See financial notes

Schwab Target 2050 Fund

Financial Statements

Financial Highlights

	11/1/13–			1/23/131–
	4/30/14*			10/31/13
Per-Share Data ($)
Net asset value at beginning of period		11.72			10.00
Income (loss) from investment operations:
Net investment income (loss)		0.13			0.02
Net realized and unrealized gains (losses)		0.52			1.70
Total from investment operations		0.65			1.72
Less distributions:
Distributions from net investment income		(0.18	)		—
Net asset value at end of period		12.19			11.72
Total return (%)		5.58	2		17.20	2
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses3		—	4		0.00	4,5
Gross operating expenses3		0.50	4		1.37	4
Net investment income (loss)		1.86	4		0.40	4
Portfolio turnover rate		6	2		40	2
Net assets, end of period ($ x 1,000,000)		23			14

* 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.

See financial notes 67

 Schwab Target 2050 Fund

Portfolio Holdings as of April 30, 2014 (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		21,223,516		22,640,475
	2	.1%	Short-Term Investment		494,826		494,826
	100	.2%	Total Investments		21,718,342		23,135,301
	(0	.2%)	Other Assets and Liabilities, Net				(43,009	)
	100	.0%	Net Assets				23,092,292

	Number		Value
Security	of Shares		($)
Other Investment Companies 98.1% of net assets
Equity Funds 94.1%
Global Real Estate 4.7%
Schwab Global Real Estate Fund (a)		155,529		1,076,263
International 22.5%
American Century International Growth Fund, Institutional Shares		66,324		891,398
Laudus International MarketMasters Fund, Select Shares (a)		71,881		1,738,801
Laudus Mondrian Emerging Markets Fund, Institutional Shares (a)		87,907		777,978
Laudus Mondrian International Equity Fund, Institutional Shares (a)		90,039		807,651
William Blair International Small Cap Growth Fund, Institutional Shares		60,343		969,705
				5,185,533
Large-Cap 53.7%
Laudus U.S. Large Cap Growth Fund *(a)		172,672		3,066,662
Schwab Core Equity Fund (a)		138,454		3,241,200
Schwab Dividend Equity Fund (a)		88,628		1,613,915
Schwab S&P 500 Index Fund (a)		99,034		2,928,450
TCW Relative Value Large Cap Fund		73,963		1,558,392
				12,408,619
Small-Cap 13.2%
Laudus Small-Cap MarketMasters Fund, Select Shares *(a)		60,173		1,063,264
Schwab Small-Cap Equity Fund (a)		82,310		1,981,208
				3,044,472
				21,714,887
Fixed-Income Funds 4.0%
Inflation-Protected Bond 0.1%
Schwab Treasury Inflation Protected Securities Index Fund (a)		1,634		18,314
Intermediate-Term Bond 3.2%
Natixis Loomis Sayles Investment Grade Bond Fund, Class Y Shares		18,780		230,811
PIMCO Total Return Fund, Institutional Shares		35,993		390,160
Schwab Intermediate-Term Bond Fund (a)		6,667		67,935
Schwab Total Bond Market Fund (a)		4,966		46,830
				735,736
International Bond 0.1%
Laudus Mondrian International Government Fixed Income Fund *(a)		2,113		23,269
Short-Term Bond 0.6%
Schwab Short-Term Bond Market Fund (a)		15,977		148,269
				925,588
Total Other Investment Companies
(Cost $21,223,516)				22,640,475
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investment 2.1% of net assets
Time Deposit 2.1%
Bank of Tokyo - Mitsubishi UFJ
0.03%, 05/01/14		494,826		494,826
Total Short-Term Investment
(Cost $494,826)				494,826
End of Investments.

At 04/30/14, the tax basis cost of the fund’s investments was $21,756,604 and the unrealized appreciation and depreciation were $1,381,047 and ($2,350), respectively, with a net unrealized appreciation of $1,378,697.

*	Non-income producing security.
(a)	Issuer is affiliated with the fund’s adviser.

68 See financial notes

 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, 2014 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Other Significant		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Other Investment Companies1		$22,640,475		$—		$—		$22,640,475
Short-Term Investment1		—		494,826		—		494,826
Total		$22,640,475		$494,826		$—		$23,135,301

¹ As categorized in portfolio holdings.

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, 2014.

See financial notes 69

 Schwab Target 2050 Fund

Statement of

Assets and Liabilities

As of April 30, 2014; unaudited

Assets
Investments in affiliated underlying funds, at value (cost $17,439,441)		$18,600,009
Investments in unaffiliated issuers, at value (cost $4,278,901)	+	4,535,292
Total investments, at value (cost $21,718,342)		23,135,301
Receivables:
Investments sold		67,000
Fund shares sold		44,251
Dividends		985
Due from investment adviser	+	458
Total assets		23,247,995
Liabilities
Payables:
Investments bought		129,981
Fund shares redeemed		5,824
Accrued expenses	+	19,898
Total liabilities		155,703
Net Assets
Total assets		23,247,995
Total liabilities	−	155,703
Net assets		$23,092,292
Net Assets by Source
Capital received from investors		21,270,609
Distributions in excess of net investment income		(55,825	)
Net realized capital gains		460,549
Net unrealized capital appreciation		1,416,959
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$23,092,292		1,894,629			$12.19

70 See financial notes

 Schwab Target 2050 Fund

Statement of

Operations

For the period November 1, 2013 through April 30, 2014; unaudited

Investment Income
Dividends received from affiliated underlying funds		$125,783
Dividends received from unaffiliated underlying funds		42,897
Interest	+	51
Total investment income		168,731
Expenses
Professional fees		16,268
Transfer agent fees		10,577
Registration fees		6,642
Custodian fees		4,320
Portfolio accounting fees		3,907
Independent trustees’ fees		2,965
Shareholder reports		393
Other expenses	+	516
Total expenses		45,588
Expense reduction by CSIM	−	45,588
Net expenses	−	—
Net investment income		168,731
Realized and Unrealized Gains (Losses)
Realized capital gain distributions received from affiliated underlying funds		476,027
Realized capital gain distributions received from unaffiliated underlying funds		47,429
Net realized losses on sales of affiliated underlying funds		(25,940	)
Net realized losses on sales of unaffiliated underlying funds	+	(3,508	)
Net realized gains		494,008
Net change in unrealized appreciation (depreciation) on affiliated underlying funds		202,985
Net change in unrealized appreciation (depreciation) on unaffiliated underlying funds	+	65,367
Net change in unrealized appreciation (depreciation)	+	268,352
Net realized and unrealized gains		762,360
Increase in net assets resulting from operations		$931,091

See financial notes 71

 Schwab Target 2050 Fund

Statement of

Changes in Net Assets

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

Operations

11/1/13-4/30/14				1/23/13*-10/31/13
Net investment income		$168,731			$21,616
Net realized gains (losses)		494,008			(33,459	)
Net change in unrealized appreciation (depreciation)	+	268,352			1,148,607
Increase in net assets from operations		931,091			1,136,764
Distributions to Shareholders
Distributions from net investment income		($246,172	)		$—

Transactions in Fund Shares

		11/1/13-4/30/14					1/23/13*-10/31/13
			SHARES		VALUE			SHARES		VALUE
Shares sold			889,145		$10,684,468			1,302,184		$14,062,670
Shares reinvested			20,179		242,557			—		—
Shares redeemed	+		(207,883	)	(2,499,383	)		(108,996	)	(1,219,703	)
Net transactions in fund shares			701,441		$8,427,642			1,193,188		$12,842,967
Shares Outstanding and Net Assets
		11/1/13-4/30/14					1/23/13*-10/31/13
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			1,193,188		$13,979,731			—		$—
Total increase	+		701,441		9,112,561			1,193,188		13,979,731
End of period			1,894,629		$23,092,292			1,193,188		$13,979,731
Distributions in excess of net investment income/Net investment income not yet distributed					($55,825	)				$21,616

* Commencement of operations.

72 See financial notes

Schwab Target 2055 Fund

Financial Statements

Financial Highlights

	11/1/13–			1/23/131–
	4/30/14*			10/31/13
Per-Share Data ($)
Net asset value at beginning of period		11.74			10.00
Income (loss) from investment operations:
Net investment income (loss)		0.14			0.02
Net realized and unrealized gains (losses)		0.52			1.72
Total from investment operations		0.66			1.74
Less distributions:
Distributions from net investment income		(0.18	)		—
Net asset value at end of period		12.22			11.74
Total return (%)		5.66	2		17.40	2
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses3		—	4		0.00	4,5
Gross operating expenses3		0.90	4		2.78	4
Net investment income (loss)		1.80	4		0.34	4
Portfolio turnover rate		11	2		12	2
Net assets, end of period ($ x 1,000,000)		13			7

* 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.

See financial notes 73

 Schwab Target 2055 Fund

Portfolio Holdings as of April 30, 2014 (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		11,803,142		12,559,628
	1	.6%	Short-Term Investment		213,405		213,405
	99	.7%	Total Investments		12,016,547		12,773,033
	0	.3%	Other Assets and Liabilities, Net				34,215
	100	.0%	Net Assets				12,807,248

	Number		Value
Security	of Shares		($)
Other Investment Companies 98.1% of net assets
Equity Funds 96.1%
Global Real Estate 4.8%
Schwab Global Real Estate Fund (a)		88,127		609,839
International 23.1%
American Century International Growth Fund, Institutional Shares		37,524		504,328
Laudus International MarketMasters Fund, Select Shares (a)		40,655		983,443
Laudus Mondrian Emerging Markets Fund, Institutional Shares (a)		52,058		460,717
Laudus Mondrian International Equity Fund, Institutional Shares (a)		50,706		454,829
William Blair International Small Cap Growth Fund, Institutional Shares		34,188		549,398
				2,952,715
Large-Cap 54.6%
Laudus U.S. Large Cap Growth Fund *(a)		97,337		1,728,696
Schwab Core Equity Fund (a)		78,023		1,826,522
Schwab Dividend Equity Fund (a)		49,772		906,355
Schwab S&P 500 Index Fund (a)		55,668		1,646,096
TCW Relative Value Large Cap Fund		42,029		885,557
				6,993,226
Small-Cap 13.6%
Laudus Small-Cap MarketMasters Fund, Select Shares *(a)		34,505		609,708
Schwab Small-Cap Equity Fund (a)		47,216		1,136,482
				1,746,190
				12,301,970
Fixed-Income Funds 2.0%
Inflation-Protected Bond 0.0%
Schwab Treasury Inflation Protected Securities Index Fund (a)		233		2,609
Intermediate-Term Bond 1.6%
Natixis Loomis Sayles Investment Grade Bond Fund, Class Y Shares		6,120		75,209
PIMCO Total Return Fund, Institutional Shares		11,729		127,137
Schwab Intermediate-Term Bond Fund (a)		206		2,099
Schwab Total Bond Market Fund (a)		379		3,577
				208,022
International Bond 0.0%
Laudus Mondrian International Government Fixed Income Fund *(a)		268		2,956
Short-Term Bond 0.4%
Schwab Short-Term Bond Market Fund (a)		4,749		44,071
				257,658
Total Other Investment Companies
(Cost $11,803,142)				12,559,628
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investment 1.6% of net assets
Time Deposit 1.6%
DNB
0.03%, 05/01/14		213,405		213,405
Total Short-Term Investment
(Cost $213,405)				213,405
End of Investments.

At 04/30/14, the tax basis cost of the fund’s investments was $12,053,529 and the unrealized appreciation and depreciation were $720,601 and ($1,097), respectively, with a net unrealized appreciation of $719,504.

*	Non-income producing security.
(a)	Issuer is affiliated with the fund’s adviser.

74 See financial notes

 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, 2014 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Other Significant		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Other Investment Companies1		$12,559,628		$—		$—		$12,559,628
Short-Term Investment1		—		213,405		—		213,405
Total		$12,559,628		$213,405		$—		$12,773,033

¹ As categorized in portfolio holdings.

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, 2014.

See financial notes 75

 Schwab Target 2055 Fund

Statement of

Assets and Liabilities

As of April 30, 2014; unaudited

Assets
Investments in affiliated underlying funds, at value (cost $9,798,435)		$10,417,999
Investments in unaffiliated issuers, at value (cost $2,218,112)	+	2,355,034
Total investments, at value (cost $12,016,547)		12,773,033
Receivables:
Investments sold		69,000
Fund shares sold		50,272
Due from investment adviser		453
Dividends	+	263
Total assets		12,893,021
Liabilities
Payables:
Investments bought		56,262
Fund shares redeemed		7,892
Accrued expenses	+	21,619
Total liabilities		85,773
Net Assets
Total assets		12,893,021
Total liabilities	−	85,773
Net assets		$12,807,248
Net Assets by Source
Capital received from investors		11,839,585
Distributions in excess of net investment income		(33,034	)
Net realized capital gains		244,211
Net unrealized capital appreciation		756,486
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$12,807,248		1,048,312			$12.22

76 See financial notes

 Schwab Target 2055 Fund

Statement of

Operations

For the period November 1, 2013 through April 30, 2014; unaudited

Investment Income
Dividends received from affiliated underlying funds		$67,401
Dividends received from unaffiliated underlying funds		21,950
Interest	+	27
Total investment income		89,378
Expenses
Professional fees		16,268
Transfer agent fees		10,561
Registration fees		5,570
Custodian fees		4,769
Portfolio accounting fees		3,836
Independent trustees’ fees		2,948
Shareholder reports		393
Other expenses	+	480
Total expenses		44,825
Expense reduction by CSIM	−	44,825
Net expenses	−	—
Net investment income		89,378
Realized and Unrealized Gains (Losses)
Realized capital gain distributions received from affiliated underlying funds		255,728
Realized capital gain distributions received from unaffiliated underlying funds		24,524
Net realized losses on sales of affiliated underlying funds		(28,668	)
Net realized losses on sales of unaffiliated underlying funds	+	(2,719	)
Net realized gains		248,865
Net change in unrealized appreciation (depreciation) on affiliated underlying funds		139,504
Net change in unrealized appreciation (depreciation) on unaffiliated underlying funds	+	37,884
Net change in unrealized appreciation (depreciation)	+	177,388
Net realized and unrealized gains		426,253
Increase in net assets resulting from operations		$515,631

See financial notes 77

 Schwab Target 2055 Fund

Statement of

Changes in Net Assets

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

Operations

11/1/13-4/30/14				1/23/13*-10/31/13
Net investment income		$89,378			$8,773
Net realized gains (losses)		248,865			(4,654	)
Net change in unrealized appreciation (depreciation)	+	177,388			579,098
Increase in net assets from operations		515,631			583,217
Distributions to Shareholders
Distributions from net investment income		($131,185	)		$—

Transactions in Fund Shares

		11/1/13-4/30/14					1/23/13*-10/31/13
			SHARES		VALUE			SHARES		VALUE
Shares sold			635,564		$7,640,625			636,663		$6,847,743
Shares reinvested			10,605		127,787			—		—
Shares redeemed	+		(183,965	)	(2,227,390	)		(50,555	)	(549,180	)
Net transactions in fund shares			462,204		$5,541,022			586,108		$6,298,563
Shares Outstanding and Net Assets
		11/1/13-4/30/14					1/23/13*-10/31/13
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			586,108		$6,881,780			—		$—
Total increase	+		462,204		5,925,468			586,108		6,881,780
End of period			1,048,312		$12,807,248			586,108		$6,881,780
Distributions in excess of net investment income/Net investment income not yet distributed					($33,034	)				$8,773

* Commencement of operations.

78 See financial notes

 Schwab Target Funds

Financial Notes, unaudited

1. Business Structure of the Funds:

Each of the funds 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”), and cash equivalents, including money market securities. 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 a 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 U.S. Securities and 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 NAVs.

79

 Schwab Target Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

•  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.

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, 2014 are disclosed in the Portfolio Holdings.

80 

 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 and 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.

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.

81

 Schwab Target Funds

Financial Notes, unaudited (continued)

3. Risk Factors (continued):

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 -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.

•  ETF 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); the imposition of economic sanctions or other government restrictions; differing accounting, auditing, financial reporting and legal standards and practices; differing securities market structures; and higher transaction costs. These risks may negatively impact the value or liquidity of the underlying fund’s investments, and could impair the underlying fund’s ability to meet its investment objective or invest in accordance with its investment strategy. To the extent an underlying fund’s investment in a single country or a limited number of countries represents a large percentage of the underlying fund’s assets, the underlying fund’s performance may be adversely affected by the economic, political and social conditions in those countries and it may be subject to increased price volatility.

•  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

82 

 Schwab Target Funds

Financial Notes, unaudited (continued)

3. Risk Factors (continued):

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, and cash equivalents, including money market securities. 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, 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 expense charged, excluding interest, taxes and certain non-routine expenses to 0.00%.

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.

83

 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, 2014, each Schwab Target Fund’s ownership percentages of other related funds’ shares 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
Underlying Funds	Fund			Fund			Fund			Fund		Fund		Fund		Fund		Fund			Fund			Fund
Schwab Global Real Estate Fund		0.5%			0.9%			5.5%			4.2%		10.6%		4.2%		12.9%		0.5%			0.4%			0.3%
Laudus International MarketMasters Fund		0.1%			0.2%			0.9%			0.7%		1.8%		0.7%		2.2%		0.1%			0.1%			0.0%	*
Laudus Mondrian Emerging Markets Fund		—%			0.1%			1.9%			2.2%		7.6%		3.7%		13.1%		0.6%			0.5%			0.3%
Laudus Mondrian International Equity Fund		0.5%			0.9%			5.6%			4.4%		11.1%		4.4%		13.7%		0.6%			0.5%			0.3%
Laudus U.S. Large Cap Growth Fund		0.2%			0.3%			2.0%			1.5%		3.6%		1.4%		4.3%		0.2%			0.1%			0.1%
Schwab Core Equity Fund		0.2%			0.3%			1.9%			1.4%		3.5%		1.3%		4.1%		0.2%			0.1%			0.1%
Schwab Dividend Equity Fund		0.1%			0.2%			1.1%			0.8%		2.1%		0.8%		2.4%		0.1%			0.1%			0.0%	*
Schwab S&P 500 Index Fund		0.0%	*		0.0%	*		0.2%			0.2%		0.4%		0.2%		0.5%		0.0%	*		0.0%	*		0.0%	*
Laudus Small-Cap MarketMasters Fund		0.4%			0.8%			5.3%			4.4%		11.8%		4.9%		15.8%		0.7%			0.6%			0.3%
Schwab Small-Cap Equity Fund		0.2%			0.4%			2.9%			2.4%		6.6%		2.7%		8.8%		0.4%			0.3%			0.2%
Schwab Treasury Inflation Protected Securities Index Fund		1.2%			1.9%			5.6%			2.5%		4.3%		0.9%		1.4%		0.0%	*		0.0%	*		0.0%	*
Schwab Intermediate-Term Bond Fund		0.5%			0.9%			3.9%			2.2%		4.0%		1.0%		1.8%		0.0%	*		0.0%	*		0.0%	*
Schwab Total Bond Market Fund		1.3%			2.0%			5.9%			2.5%		3.8%		0.8%		1.0%		0.0%	*		0.0%	*		0.0%	*
Laudus Mondrian International Government Fixed Income Fund		0.1%			0.2%			1.2%			0.7%		1.3%		0.3%		0.3%		0.0%	*		0.0%	*		0.0%	*
(formerly, Laudus Mondrian International Fixed Income Fund)
Schwab Short-Term Bond Market Fund		2.2%			3.3%			8.6%			3.5%		4.9%		1.1%		2.3%		0.1%			0.0%	*		0.0%	*
Schwab Value Advantage Money Fund		0.0%	*		0.0%	*		0.0%	*		—%		—%		—%		—%		—%			—%			—%

* Less than 0.1%

84 

 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, 2014.

Schwab Target 2010 Fund:
	Balance							Balance				Realized		Distributions
	of Shares							of Shares		Market		Gains (Losses)		Received*
	Held at		Gross		Gross			Held at		Value at		11/01/13		11/01/13
Underlying Funds	10/31/13		Purchases		Sales			04/30/14		04/30/14		to 04/30/14		to 04/30/14
Schwab Global Real Estate Fund		174,459		13,076		(14,227	)		173,308		$1,199,289		$5,378		$29,825
Laudus International MarketMasters Fund, Select Shares		101,163		11,294		(33,606	)		78,851		1,907,418		325,064		35,332
Laudus Mondrian Emerging Markets Fund, Institutional Shares		32,094		12,849		(44,943	)		—		—		81,789		5,132
Laudus Mondrian International Equity Fund, Institutional Shares		100,910		1,393		(17,084	)		85,219		764,418		12,232		22,906
Laudus U.S. Large Cap Growth Fund		208,254		53,953		(37,747	)		224,460		3,986,401		165,966		242,737
Schwab Core Equity Fund		136,377		51,077		(15,221	)		172,233		4,031,973		75,024		252,216
Schwab Dividend Equity Fund		93,954		39,568		(13,604	)		119,918		2,183,712		13,638		129,813
Schwab S&P 500 Index Fund		109,807		34,212		(10,263	)		133,756		3,955,154		56,678		51,261
Laudus Small-Cap MarketMasters Fund, Select Shares		61,592		3,837		(23,469	)		41,960		741,437		219,828		—
Schwab Small-Cap Equity Fund		93,116		13,899		(49,888	)		57,127		1,375,037		462,953		214,501
Schwab Treasury Inflation Protected Securities Index Fund		276,755		24,832		(18,021	)		283,566		3,178,776		7,124		24,491
Schwab Intermediate-Term Bond Fund		160,330		32,600		(10,151	)		182,779		1,862,519		766		18,365
Schwab Total Bond Market Fund		1,362,871		98,249		(98,136	)		1,362,984		12,852,943		1,733		148,888
Laudus Mondrian International Government Fixed Income Fund		42,522		2,786		(13,109	)		32,199		354,508		8,914		2,950
(formerly, Laudus Mondrian International Fixed Income Fund)
Schwab Short-Term Bond Market Fund		1,006,011		77,807		(61,683	)		1,022,135		9,485,412		3,617		39,188
Schwab Value Advantage Money Fund, Institutional Prime Shares		1,968,431		70		—			1,968,501		1,968,501		—		181
Total											$49,847,498		$1,440,704		$1,217,786

85

 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		11/01/13			11/01/13
Underlying Funds	10/31/13		Purchases		Sales			04/30/14		04/30/14		to 04/30/14			to 04/30/14
Schwab Global Real Estate Fund		317,511		30,677		(19,318	)		328,870		$2,275,782		$7,528			$56,335
Laudus International MarketMasters Fund, Select Shares		180,373		24,598		(48,679	)		156,292		3,780,701		207,367			65,405
Laudus Mondrian Emerging Markets Fund, Institutional Shares		59,556		22,346		(72,437	)		9,465		83,763		60,296			9,315
Laudus Mondrian International Equity Fund, Institutional Shares		202,787		19,994		(49,410	)		173,371		1,555,139		29,595			45,666
Laudus U.S. Large Cap Growth Fund		371,068		94,893		(47,544	)		418,417		7,431,093		96,480			452,641
Schwab Core Equity Fund		259,908		88,218		(24,766	)		323,360		7,569,854		43,616			485,675
Schwab Dividend Equity Fund		172,443		73,306		(23,805	)		221,944		4,041,599		28,125			243,123
Schwab S&P 500 Index Fund		201,034		53,452		(9,045	)		245,441		7,257,684		8,953			98,492
Laudus Small-Cap MarketMasters Fund, Select Shares		114,378		19,066		(48,579	)		84,865		1,499,558		371,383			—
Schwab Small-Cap Equity Fund		168,847		37,282		(90,320	)		115,809		2,787,521		830,278			411,067
Schwab Treasury Inflation Protected Securities Index Fund		359,131		83,452		(11,694	)		430,889		4,830,268		1,951			33,550
Schwab Intermediate-Term Bond Fund		271,173		73,913		(25,137	)		319,949		3,260,280		(2,008	)		31,424
Schwab Total Bond Market Fund		1,708,846		410,991		(68,873	)		2,050,964		19,340,594		6,925			210,325
Laudus Mondrian International Government Fixed Income Fund		94,222		6,923		(25,318	)		75,827		834,857		655			6,436
(formerly, Laudus Mondrian International Fixed Income Fund)
Schwab Short-Term Bond Market Fund		1,208,786		344,304		(61,962	)		1,491,128		13,837,668		3,166			53,512
Schwab Value Advantage Money Fund, Institutional Prime Shares		1,991,651		700,096		—			2,691,747		2,691,747		—			211
Total											$83,078,108		$1,694,310			$2,203,177

86 

 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		11/01/13		11/01/13
Underlying Funds	10/31/13		Purchases		Sales			04/30/14		04/30/14		to 04/30/14		to 04/30/14
Schwab Global Real Estate Fund		1,782,023		192,635		(55,566	)		1,919,092		$13,280,115		$31,601		$320,484
Laudus International MarketMasters Fund, Select Shares		993,395		114,334		(209,644	)		898,085		21,724,671		649,861		360,259
Laudus Mondrian Emerging Markets Fund, Institutional Shares		325,308		108,231		(117,601	)		315,938		2,796,051		287,347		48,634
Laudus Mondrian International Equity Fund, Institutional Shares		1,155,406		103,121		(200,409	)		1,058,118		9,491,319		138,143		263,813
Laudus U.S. Large Cap Growth Fund		2,044,008		457,909		(149,026	)		2,352,891		41,787,341		416,362		2,475,737
Schwab Core Equity Fund		1,492,538		389,538		(30,132	)		1,851,944		43,354,022		54,027		2,791,716
Schwab Dividend Equity Fund		974,769		298,773		(51,567	)		1,221,975		22,252,161		55,000		1,338,134
Schwab S&P 500 Index Fund		1,127,432		296,392		(39,037	)		1,384,787		40,948,152		56,067		545,265
Laudus Small-Cap MarketMasters Fund, Select Shares		660,298		84,394		(180,440	)		564,252		9,970,327		1,438,075		—
Schwab Small-Cap Equity Fund		933,256		182,009		(343,364	)		771,901		18,579,667		3,326,360		2,260,928
Schwab Treasury Inflation Protected Securities Index Fund		1,078,250		240,924		(11,722	)		1,307,452		14,656,537		2,174		99,640
Schwab Intermediate-Term Bond Fund		1,114,851		297,405		(37,291	)		1,374,965		14,010,891		3,596		131,673
Schwab Total Bond Market Fund		4,998,955		1,113,952		(61,900	)		6,051,007		57,060,999		7,025		612,322
Laudus Mondrian International Government Fixed Income Fund		495,913		61,294		(90,824	)		466,383		5,134,874		46,900		33,553
(formerly, Laudus Mondrian International Fixed Income Fund)
Schwab Short-Term Bond Market Fund		3,177,642		861,660		(115,302	)		3,924,000		36,414,723		9,246		139,246
Schwab Value Advantage Money fund, Institutional Prime Shares		—		5,000,174		—			5,000,174		5,000,174		—		199
Total											$356,462,024		$6,521,784		$11,421,603

87

 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		11/01/13		11/01/13
Underlying Funds	10/31/13		Purchases		Sales			04/30/14		04/30/14		to 04/30/14		to 04/30/14
Schwab Global Real Estate Fund		1,264,302		226,472		(39,017	)		1,451,757		$10,046,157		$25,361		$233,233
Laudus International MarketMasters Fund, Select Shares		686,104		116,416		(123,088	)		679,432		16,435,465		354,412		252,447
Laudus Mondrian Emerging Markets Fund, Institutional Shares		225,922		212,943		(58,675	)		380,190		3,364,684		92,477		33,604
Laudus Mondrian International Equity Fund, Institutional Shares		837,115		107,090		(124,692	)		819,513		7,351,034		118,920		187,448
Laudus U.S. Large Cap Growth Fund		1,425,998		394,133		(85,546	)		1,734,585		30,806,221		202,721		1,735,389
Schwab Core Equity Fund		1,059,030		331,543		(15,424	)		1,375,149		32,192,243		19,071		2,004,700
Schwab Dividend Equity Fund		684,124		246,991		(34,686	)		896,429		16,323,965		43,866		942,197
Schwab S&P 500 Index Fund		792,409		251,128		(27,932	)		1,015,605		30,031,433		60,290		387,252
Laudus Small-Cap MarketMasters Fund, Select Shares		467,612		90,640		(92,968	)		465,284		8,221,565		226,867		—
Schwab Small-Cap Equity Fund		652,791		170,444		(186,836	)		636,399		15,318,136		349,509		1,594,910
Schwab Treasury Inflation Protected Securities Index Fund		448,259		143,095		(8,116	)		583,238		6,538,102		1,454		42,086
Schwab Intermediate-Term Bond Fund		576,806		203,050		(13,739	)		766,117		7,806,737		2,336		70,686
Schwab Total Bond Market Fund		2,015,888		604,270		(20,277	)		2,599,881		24,516,876		2,433		256,402
Laudus Mondrian International Government Fixed Income Fund		276,903		49,405		(48,689	)		277,619		3,056,588		4,463		18,994
(formerly, Laudus Mondrian International Fixed Income Fund)
Schwab Short-Term Bond Market Fund		1,213,396		419,620		(48,491	)		1,584,525		14,704,388		4,506		54,942
Total											$226,713,594		$1,508,686		$7,814,290

88 

 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		11/01/13		11/01/13
Underlying Funds	10/31/13		Purchases		Sales			04/30/14		04/30/14		to 04/30/14		to 04/30/14
Schwab Global Real Estate Fund		3,468,314		338,637		(117,052	)		3,689,899		$25,534,102		$76,084		$619,445
Laudus International MarketMasters Fund, Select Shares		1,890,535		129,351		(302,368	)		1,717,518		41,546,772		615,793		683,354
Laudus Mondrian Emerging Markets Fund, Institutional Shares		632,856		822,091		(162,381	)		1,292,566		11,439,211		207,684		90,009
Laudus Mondrian International Equity Fund, Institutional Shares		2,297,220		98,620		(301,594	)		2,094,246		18,785,385		238,077		514,348
Laudus U.S. Large Cap Growth Fund		3,885,576		600,404		(172,209	)		4,313,771		76,612,567		467,307		4,708,123
Schwab Core Equity Fund		2,944,866		527,186		(41,568	)		3,430,484		80,307,629		71,354		5,516,901
Schwab Dividend Equity Fund		1,864,777		443,703		(88,975	)		2,219,505		40,417,178		115,934		2,551,428
Schwab S&P 500 Index Fund		2,176,358		323,556		(51,784	)		2,448,130		72,391,211		121,237		1,047,667
Laudus Small-Cap MarketMasters Fund, Select Shares		1,289,028		105,926		(138,930	)		1,256,024		22,193,952		1,034,950		—
Schwab Small-Cap Equity Fund		1,788,903		303,830		(373,942	)		1,718,791		41,371,310		2,172,605		4,335,131
Schwab Treasury Inflation Protected Securities Index Fund		826,600		198,212		(27,051	)		997,761		11,184,900		3,915		76,616
Schwab Intermediate-Term Bond Fund		1,239,274		242,243		(73,747	)		1,407,770		14,345,179		5,740		140,963
Schwab Total Bond Market Fund		3,194,473		777,597		(92,646	)		3,879,424		36,582,970		10,571		394,562
Laudus Mondrian International Government Fixed Income Fund		533,238		104,441		(131,086	)		506,593		5,577,590		57,029		37,544
(formerly, Laudus Mondrian International Fixed Income Fund)
Schwab Short-Term Bond Market Fund		1,880,621		470,599		(120,689	)		2,230,531		20,699,326		9,615		80,737
Total											$518,989,282		$5,207,895		$20,796,828

89

 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		11/01/13			11/01/13
Underlying Funds	10/31/13		Purchases		Sales			04/30/14		04/30/14		to 04/30/14			to 04/30/14
Schwab Global Real Estate Fund		1,245,858		251,497		(41,908	)		1,455,447		$10,071,697		$26,840			$233,333
Laudus International MarketMasters Fund, Select Shares		674,742		105,732		(104,848	)		675,626		16,343,392		343,521			248,906
Laudus Mondrian Emerging Markets Fund, Institutional Shares		221,793		447,761		(42,641	)		626,913		5,548,182		41,643			32,491
Laudus Mondrian International Equity Fund, Institutional Shares		832,611		101,322		(103,097	)		830,836		7,452,595		113,356			191,740
Laudus U.S. Large Cap Growth Fund		1,392,869		332,575		(53,365	)		1,672,079		29,696,128		109,802			1,716,807
Schwab Core Equity Fund		1,064,628		275,222		—			1,339,850		31,365,889		—			2,030,161
Schwab Dividend Equity Fund		666,950		207,602		(17,411	)		857,141		15,608,528		17,686			933,297
Schwab S&P 500 Index Fund		780,398		186,000		(10,908	)		955,490		28,253,831		(683	)		387,327
Laudus Small-Cap MarketMasters Fund, Select Shares		466,053		75,822		(20,419	)		521,456		9,214,126		59,108			—
Schwab Small-Cap Equity Fund		641,150		161,848		(89,736	)		713,262		17,168,220		258,135			1,581,723
Schwab Treasury Inflation Protected Securities Index Fund		151,982		71,870		(3,152	)		220,700		2,474,042		(3,820	)		15,921
Schwab Intermediate-Term Bond Fund		275,184		103,363		(30,443	)		348,104		3,547,175		4,125			34,264
Schwab Total Bond Market Fund		542,624		282,875		(2,685	)		822,814		7,759,132		(134	)		76,140
Laudus Mondrian International Government Fixed Income Fund		118,135		43,369		(46,816	)		114,688		1,262,712		(545	)		8,174
(formerly, Laudus Mondrian International Fixed Income Fund)
Schwab Short-Term Bond Market Fund		396,960		140,605		(19,396	)		518,169		4,808,604		1,920			17,937
Total											$190,574,253		$970,954			$7,508,221

90 

 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		11/01/13		11/01/13
Underlying Funds	10/31/13		Purchases		Sales			04/30/14		04/30/14		to 04/30/14		to 04/30/14
Schwab Global Real Estate Fund		4,140,897		559,362		(196,802	)		4,503,457		$31,163,925		$100,492		$745,363
Laudus International MarketMasters Fund, Select Shares		2,235,553		161,368		(311,451	)		2,085,470		50,447,527		856,690		806,500
Laudus Mondrian Emerging Markets Fund, Institutional Shares		740,308		1,693,393		(211,837	)		2,221,864		19,663,498		200,467		104,500
Laudus Mondrian International Equity Fund, Institutional Shares		2,773,538		193,623		(385,478	)		2,581,683		23,157,693		277,157		630,787
Laudus U.S. Large Cap Growth Fund		4,612,591		638,493		(166,679	)		5,084,405		90,299,040		304,424		5,558,336
Schwab Core Equity Fund		3,542,709		615,590		(93,268	)		4,065,031		95,162,367		163,514		6,629,430
Schwab Dividend Equity Fund		2,213,536		443,451		(66,132	)		2,590,855		47,179,478		83,434		3,021,462
Schwab S&P 500 Index Fund		2,596,342		295,994		(25,273	)		2,867,063		84,779,043		78,252		1,250,542
Laudus Small-Cap MarketMasters Fund, Select Shares		1,544,461		144,573		(11,608	)		1,677,426		29,640,125		30,101		—
Schwab Small-Cap Equity Fund		2,131,039		367,379		(202,981	)		2,295,437		55,251,163		333,123		5,131,578
Schwab Treasury Inflation Protected Securities Index Fund		267,654		78,712		(9,017	)		337,349		3,781,682		1,409		24,842
Schwab Intermediate-Term Bond Fund		522,433		126,675		(20,649	)		628,459		6,403,996		1,801		62,458
Schwab Total Bond Market Fund		652,972		341,335		(3,747	)		990,560		9,340,978		1,049		91,805
Laudus Mondrian International Government Fixed Income Fund		181,646		49,814		(129,213	)		102,247		1,125,736		27,464		12,248
(formerly, Laudus Mondrian International Fixed Income Fund)
Schwab Short-Term Bond Market Fund		896,155		194,326		(39,870	)		1,050,611		9,749,670		3,440		37,809
Total											$557,145,921		$2,462,817		$24,107,660

91

 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		11/01/13			11/01/13
Underlying Funds	10/31/13		Purchases		Sales			04/30/14		04/30/14		to 04/30/14			to 04/30/14
Schwab Global Real Estate Fund		117,387		77,963		(5,548	)		189,802		$1,313,428		($2,408	)		$26,389
Laudus International MarketMasters Fund, Select Shares		63,242		31,039		(6,528	)		87,753		2,122,751		310			25,023
Laudus Mondrian Emerging Markets Fund, Institutional Shares		20,761		84,061		(3,453	)		101,369		897,120		(3,505	)		3,174
Laudus Mondrian International Equity Fund, Institutional Shares		78,856		39,143		(8,443	)		109,556		982,713		(1,028	)		19,552
Laudus U.S. Large Cap Growth Fund		129,934		87,705		(5,236	)		212,403		3,772,279		(2,624	)		172,268
Schwab Core Equity Fund		100,004		72,951		(2,950	)		170,005		3,979,813		(2,539	)		203,485
Schwab Dividend Equity Fund		63,277		47,756		(2,683	)		108,350		1,973,041		(1,160	)		95,637
Schwab S&P 500 Index Fund		74,563		48,033		(1,919	)		120,677		3,568,427		68			39,042
Laudus Small-Cap MarketMasters Fund, Select Shares		44,072		29,732		(1,577	)		72,227		1,276,252		(345	)		—
Schwab Small-Cap Equity Fund		60,262		41,095		(2,513	)		98,844		2,379,186		(885	)		158,982
Schwab Treasury Inflation Protected Securities Index Fund		3,765		3,818		(362	)		7,221		80,951		(358	)		400
Schwab Intermediate-Term Bond Fund		9,364		7,250		(2,458	)		14,156		144,250		(382	)		1,266
Schwab Total Bond Market Fund		2,403		7,781		—			10,184		96,034		—			730
Laudus Mondrian International Government Fixed Income Fund)		1,352		2,206		—			3,558		39,177		—			100
(formerly, Laudus Mondrian International Fixed Income Fund)
Schwab Short-Term Bond Market Fund		19,639		12,590		(1,078	)		31,151		289,082		(11	)		992
Total											$22,914,504		($14,867	)		$747,040

92 

 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		11/01/13			11/01/13
Underlying Funds	10/31/13		Purchases		Sales			04/30/14		04/30/14		to 04/30/14			to 04/30/14
Schwab Global Real Estate Fund		96,224		67,147		(7,842	)		155,529		$1,076,263		($3,887	)		$21,202
Laudus International MarketMasters Fund, Select Shares		51,477		26,515		(6,111	)		71,881		1,738,801		(1,650	)		20,157
Laudus Mondrian Emerging Markets Fund, Institutional Shares		17,235		75,672		(5,000	)		87,907		777,978		(6,292	)		2,556
Laudus Mondrian International Equity Fund, Institutional Shares		64,671		31,852		(6,484	)		90,039		807,651		(1,214	)		15,553
Laudus U.S. Large Cap Growth Fund		106,570		72,029		(5,927	)		172,672		3,066,662		(3,100	)		138,421
Schwab Core Equity Fund		82,365		61,233		(5,144	)		138,454		3,241,200		(4,377	)		165,147
Schwab Dividend Equity Fund		51,796		40,762		(3,930	)		88,628		1,613,915		(2,107	)		76,955
Schwab S&P 500 Index Fund		60,186		42,326		(3,478	)		99,034		2,928,450		(807	)		31,702
Laudus Small-Cap MarketMasters Fund, Select Shares		36,055		26,336		(2,218	)		60,173		1,063,264		(471	)		—
Schwab Small-Cap Equity Fund		49,256		36,585		(3,531	)		82,310		1,981,208		(1,547	)		128,673
Schwab Treasury Inflation Protected Securities Index Fund		355		1,553		(274	)		1,634		18,314		(293	)		63
Schwab Intermediate-Term Bond Fund		2,990		3,677		—			6,667		67,935		—			506
Schwab Total Bond Market Fund		742		4,438		(214	)		4,966		46,830		(32	)		348
Laudus Mondrian International Government Fixed Income Fund		355		2,033		(275	)		2,113		23,269		(135	)		35
(formerly, Laudus Mondrian International Fixed Income Fund)
Schwab Short-Term Bond Market Fund		9,573		7,591		(1,187	)		15,977		148,269		(28	)		492
Total											$18,600,009		($25,940	)		$601,810

93

 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		11/01/13			11/01/13
Underlying Funds	10/31/13		Purchases		Sales			04/30/14		04/30/14		to 04/30/14			to 04/30/14
Schwab Global Real Estate Fund		47,974		48,934		(8,781	)		88,127		$609,839		($4,973	)		$11,607
Laudus International MarketMasters Fund, Select Shares		25,906		20,297		(5,548	)		40,655		983,443		(1,437	)		10,796
Laudus Mondrian Emerging Markets Fund, Institutional Shares		8,518		47,735		(4,195	)		52,058		460,717		(5,784	)		1,372
Laudus Mondrian International Equity Fund, Institutional Shares		32,509		24,377		(6,180	)		50,706		454,829		(598	)		8,399
Laudus U.S. Large Cap Growth Fund		53,170		52,567		(8,400	)		97,337		1,728,696		(4,631	)		74,113
Schwab Core Equity Fund		41,246		42,359		(5,582	)		78,023		1,826,522		(4,942	)		88,837
Schwab Dividend Equity Fund		26,067		28,011		(4,306	)		49,772		906,355		(2,786	)		41,323
Schwab S&P 500 Index Fund		30,029		29,966		(4,327	)		55,668		1,646,096		45			17,094
Laudus Small-Cap MarketMasters Fund, Select Shares		17,954		18,696		(2,145	)		34,505		609,708		(503	)		—
Schwab Small-Cap Equity Fund		24,693		25,758		(3,235	)		47,216		1,136,482		(3,042	)		69,356
Schwab Treasury Inflation Protected Securities Index Fund		141		92		—			233		2,609		—			14
Schwab Intermediate-Term Bond Fund		106		297		(197	)		206		2,099		(4	)		23
Schwab Total Bond Market Fund		108		592		(321	)		379		3,577		0	**		36
Laudus Mondrian International Government Fixed Income Fund		175		93		—			268		2,956		—			11
(formerly, Laudus Mondrian International Fixed Income Fund)
Schwab Short-Term Bond Market Fund		2,583		2,490		(324	)		4,749		44,071		(13	)		148
Total											$10,417,999		($28,668	)		$323,129

*	Distributions received include distributions from net investment income and capital gains, if any, from the underlying funds.
**	Less than $1.

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 CSIM 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.

94 

 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 on the funds’ 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, 2014, purchases and sales/maturities of securities (excluding short-term obligations) were as follows:

	Purchases of Securities		Sales/Maturities of Securities
Schwab Target 2010 Fund		$7,944,483		$7,823,853
Schwab Target 2015 Fund		21,097,964		11,213,000
Schwab Target 2020 Fund		83,782,737		33,470,000
Schwab Target 2025 Fund		63,639,139		19,020,000
Schwab Target 2030 Fund		95,644,994		42,160,000
Schwab Target 2035 Fund		50,166,374		11,693,000
Schwab Target 2040 Fund		98,179,970		34,055,000
Schwab Target 2045 Fund		11,671,465		838,000
Schwab Target 2050 Fund		9,721,399		1,017,000
Schwab Target 2055 Fund		6,734,113		1,058,000

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
	(11/1/13-4/30/14)		(11/1/12-10/31/13)
Schwab Target 2010 Fund		$662		$3,899
Schwab Target 2015 Fund		4,657		3,207
Schwab Target 2020 Fund		1,466		5,882
Schwab Target 2025 Fund		3,184		32,594
Schwab Target 2030 Fund		3,663		11,506
Schwab Target 2035 Fund		4,199		3,480
Schwab Target 2040 Fund		5,042		23,159
Schwab Target 2045 Fund		737		467	*
Schwab Target 2050 Fund		2,427		470	*
Schwab Target 2055 Fund		221		719	*

* Since commencement of operations 1/23/13

95

 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, 2013, the 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		$2,707,716		$—		$7,063,866		$—		$6,336,677		$—		$6,366,179
October 31, 2017		13,259,379		15,291		26,262,598		404,977		21,027,180		357,333		15,004,416
October 31, 2018		—		—		1,839,068		—		890,126		—		475,341
October 31, 2019		—		—		—		—		205,693		—		51,729
No expiration*		—		—		—		—		—		—		384,596
Total		$15,967,095		$15,291		$35,165,532		$404,977		$28,459,676		$357,333		$22,282,261
	Schwab		Schwab		Schwab
	Target		Target		Target
	2045		2050		2055
Expiration Date	Fund		Fund		Fund
No expiration*		$27,855		$26,104		$424
Total		$27,855		$26,104		$424

* 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, 2013, 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

$1,893,746

$425,502

$1,986,114

$368,787

$1,795,439

$241,185

$1,203,022

As of October 31, 2013, 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, 2013, 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.

96 

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 97 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).	76	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).	76	Director, Gilead Sciences, Inc. (2005 – present) Director, Monaco Coach Corporation (2005 – 2009)
David L. Mahoney 1954 Trustee (Trustee of Schwab Capital Trust since 2011.)	Private Investor.	76	Director, Symantec Corporation (2003 – present) Director, Corcept Therapeutics Incorporated (2004 – present)
Kiran M. Patel 1948 Trustee (Trustee of Schwab Capital Trust since 2011.)	Retired. Executive Vice President and General Manager of Small Business Group, Intuit, Inc. (financial software and services for consumers and small businesses) (Dec. 2008 – Sept. 2013).	76	Director, KLA-Tencor Corporation (2008 – present)
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).	76	Director, Eaton (2012 – present) Director and Chairman of the Audit Committee, Oneok Partners LP (2003 – 2013) Director, Oneok, Inc. (2009 – 2013) Lead Independent Director, Board of Cooper Industries (2002 – 2012)
Joseph H. Wender 1944 Trustee (Trustee of Schwab Capital Trust since 2008.)	Senior Consultant, Goldman Sachs & Co., Inc. (investment banking and securities firm) (Jan. 2008 – present); Partner, Colgin Partners, LLC (vineyards) (February 1998 – present).	76	Board Member and Chairman of the Audit Committee, Isis Pharmaceuticals (1994 – present)

97

 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.	76	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.	97	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, Chief Executive Officer (Dec. 2010 – present), and Chief Investment Officer (Sept. 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 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 (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).

98 

 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
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).
David Lekich 1964 Chief Legal Officer and Secretary (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 and Assistant Secretary (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 retire at age 72 or after twenty years as a trustee, whichever comes first. In addition, the retirement policy requires any independent trustee of 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 own stock of The Charles Schwab Corporation, the parent company of 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.

99

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 represents securities that are SEC-registered, taxable, and dollar denominated. The index covers the U.S. investment grade fixed rate bond market, with index components for government and corporate securities, mortgage pass-through securities, and asset-backed securities.

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.

Barclays U.S. TIPS (Treasury Inflation-Protected Securities) Index An index that measures the performance of fixed income securities with fixed-rate coupon payments that adjust for inflation, as measured by the Consumer Price Index for All Urban Consumers.

Barclays U.S. Treasury Bills 1 − 3 Months Index An index that includes all publicly issued zero-coupon U.S. Treasury Bills that have a remaining maturity of less than 3 months and more than 1 month, are rated investment grade, and have $250 million or more of outstanding face 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 capital gain or loss is considered unrealized appreciation or depreciation.

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.

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.

market cap, market capitalization The value of a company as determined by the total value of all shares of its stock outstanding.

MSCI EAFE (Europe, Australasia, Far East) 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.

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.

Russell 2000 Index An index that 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.

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.

Target 2010 Composite Index A custom blended index developed by CSIM based on the 2010 fund’s asset allocation glide schedule that will become more conservative as time elapses. Effective March 1, 2014, the Down Jones U.S. Total Stock Market Index has been replaced by a combination of the S&P 500 Index and the Russell 2000 Index. The current composite is derived using the following portion allocations: 25.9% S&P 500 Index, 3.4% Russell 2000 Index, 7.3% MSCI EAFE Index, 1.9% FTSE EPRA/NAREIT Global Index, 28.3% Barclays US Aggregate Bond Index, 3.5% Barclays US Aggregate Intermediate Bond Index, 1.9% Barclays US Government/Credit Bond Index, 14.4% Barclays US Government/Credit: 1 − 5Yrs, 5.7% Barclays US TIPS Index, 1.3% Citigroup Non-US Dollar World Government Bond Index, and 6.5% Barclays US Treasury Bills: 1 − 3 Months.

100 

Target 2015 Composite Index A custom blended index developed by CSIM based on the 2015 fund’s asset allocation glide schedule that will become more conservative as time elapses. Effective March 1, 2014, the Down Jones U.S. Total Stock Market Index has been replaced by a combination of the S&P 500 Index and the Russell 2000 Index. The current composite is derived using the following portion allocations: 28.4% S&P 500 Index, 4.0% Russell 2000 Index, 8.6% MSCI EAFE Index, 0.1% MSCI Emerging Markets Index, 2.2% FTSE EPRA/NAREIT Global Index, 26.5% Barclays US Aggregate Bond Index, 3.6% Barclays US Aggregate Intermediate Bond Index, 2.1% Barclays US Government/Credit Bond Index, 12.1% Barclays US Government/Credit: 1 − 5Yrs, 5.1% Barclays US TIPS Index, 1.5% Citigroup Non-US Dollar World Government Bond Index, and 5.8% Barclays US Treasury Bills: 1 − 3 Months.

Target 2020 Composite Index A custom blended index developed by CSIM based on the 2020 fund’s asset allocation glide schedule that will become more conservative as time elapses. Effective March 1, 2014, the Down Jones U.S. Total Stock Market Index has been replaced by a combination of the S&P 500 Index and the Russell 2000 Index. The current composite is derived using the following portion allocations: 36.0% S&P 500 Index, 6.1% Russell 2000 Index, 11.3% MSCI EAFE Index, 0.6% MSCI EM Index, 2.8% FTSE EPRA/NAREIT Global Index, 20.9% Barclays US Aggregate Bond Index, 3.5% Barclays US Aggregate Intermediate Bond Index, 2.5% Barclays US Government/Credit Bond Index, 6.7% Barclays US Government/Credit: 1 − 5Yrs, 3.7% Barclays US TIPS Index, 1.8% Citigroup Non-US Dollar World Government Bond Index, and 4.1% Barclays US Treasury Bills: 1 − 3 Months.

Target 2025 Composite Index 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. Effective March 1, 2014, the Down Jones U.S. Total Stock Market Index has been replaced by a combination of the S&P 500 Index and the Russell 2000 Index. The current composite is derived using the following portion allocations: 41.2% S&P 500 Index, 7.8% Russell 2000 Index, 13.4% MSCI EAFE Index, 1.1% MSCI EM Index, 3.3% FTSE EPRA/NAREIT Global Index, 16.4% Barclays US Aggregate Bond Index, 3.1% Barclays US Aggregate Intermediate Bond Index, 2.4% Barclays US Government/Credit Bond Index, 3.8% Barclays US Government/Credit: 1 − 5Yrs, 2.7% Barclays US TIPS Index, 1.7% Citigroup Non-US Dollar World Government Bond Index, and 3.2% Barclays US Treasury Bills: 1 − 3 Months.

Target 2030 Composite Index A custom blended index developed by CSIM based on the 2030 fund’s asset allocation glide schedule that will become more conservative as time elapses. Effective March 1, 2014, the Down Jones U.S. Total Stock Market Index has been replaced by a combination of the S&P 500 Index and the Russell 2000 Index. The current composite is derived using the following portion allocations: 45.0% S&P 500 Index, 9.2% Russell 2000 Index, 15.0% MSCI EAFE Index, 1.6% MSCI Emerging Markets Index, 3.7% FTSE EPRA/NAREIT Global Index, 12.6% Barclays US Aggregate Bond Index, 2.6% Barclays US Aggregate Intermediate Bond Index, 2.1% Barclays US Government/Credit Bond Index, 2.0% Barclays US Government/Credit: 1 − 5Yrs, 1.9% Barclays US TIPS Index, 1.5% Citigroup Non-US Dollar World Government Bond Index, and 2.6% Barclays US Treasury Bills: 1 − 3 Months.

Target 2035 Composite Index A custom blended index developed by CSIM based on the 2035 fund’s asset allocation glide schedule that will become more conservative as time elapses. Effective March 1, 2014, the Down Jones U.S. Total Stock Market Index has been replaced by a combination of the S&P 500 Index and the Russell 2000 Index. The current composite is derived using the following portion allocations: 48.3% S&P 500 Index, 10.6% Russell 2000 Index, 16.4% MSCI EAFE Index, 2.2% MSCI Emerging Markets Index, 4.1% FTSE EPRA/NAREIT Global Index, 9.1% Barclays US Aggregate Bond Index, 2.0% Barclays US Aggregate Intermediate Bond Index, 1.6% Barclays US Government/Credit Bond Index, 0.9% Barclays US Government/Credit: 1 − 5Yrs, 1.3% Barclays US TIPS Index, 1.2% Citigroup Non-US Dollar World Government Bond Index, and 2.3% Barclays US Treasury Bills: 1 − 3 Months.

Target 2040 Composite Index 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. Effective March 1, 2014, the Down Jones U.S. Total Stock Market Index has been replaced by a combination of the S&P 500 Index and the Russell 2000 Index. The current composite is derived using the following portion allocations: 50.9% S&P 500 Index, 11.8% Russell 2000 Index, 17.5% MSCI EAFE Index, 2.7% MSCI Emerging Markets Index, 4.4% FTSE EPRA/NAREIT Global Index, 6.0% Barclays US Aggregate Bond Index, 1.4% Barclays US Aggregate Intermediate Bond Index, 1.2% Barclays US Government/Credit Bond Index, 0.4% Barclays US Government/Credit: 1 − 5Yrs, 0.8% Barclays US TIPS Index, 0.9% Citigroup Non-US Dollar World Government Bond Index, and 2.1% Barclays US Treasury Bills: 1 − 3 Months.

Target 2045 Composite Index A custom blended index developed by CSIM based on the 2045 fund’s asset allocation glide schedule that will become more conservative as time elapses. Effective March 1, 2014, the Down Jones U.S. Total Stock Market Index has been replaced by a combination of the S&P 500 Index and the Russell 2000 Index. The current composite is derived using the following portion allocations: 52.2% S&P 500 Index, 12.5% Russell 2000 Index, 18.1% MSCI EAFE Index, 3.1% MSCI Emerging Markets Index, 4.5% FTSE EPRA/NAREIT Global Index, 4.3% Barclays US Aggregate Bond Index, 1.0% Barclays US Aggregate Intermediate Bond Index, 0.8% Barclays US Government/Credit Bond Index, 0.1% Barclays US Government/Credit: 1 − 5Yrs, 0.6% Barclays US TIPS Index, 0.6% Citigroup Non-US Dollar World Government Bond Index, and 2.0% Barclays US Treasury Bills: 1 − 3 Months.

Target 2050 Composite Index A custom blended index developed by CSIM based on the 2050 fund’s asset allocation glide schedule that will become more conservative as time elapses. Effective March 1, 2014, the Down Jones U.S. Total Stock Market Index has been replaced by a combination of the S&P 500 Index and the Russell 2000 Index. The current composite is derived using the following portion allocations: 53.3% S&P 500 Index, 13.1% Russell 2000 Index, 18.6% MSCI EAFE Index, 3.3% MSCI Emerging Markets Index, 4.6% FTSE EPRA/NAREIT Global Index, 2.9% Barclays US Aggregate Bond Index, 0.7% Barclays US Aggregate Intermediate Bond Index, 0.6% Barclays US Government/Credit Bond Index, 0.4% Barclays US TIPS Index, 0.4% Citigroup Non-US Dollar World Government Bond Index, and 2.0% Barclays US Treasury Bills: 1 − 3 Months.

Target 2055 Composite Index 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. Effective March 1, 2014, the Down Jones U.S. Total Stock Market Index has been replaced by a combination of the S&P 500 Index and the Russell 2000 Index. The current composite is derived using the following portion allocations: 54.2% S&P 500 Index, 13.5% Russell 2000 Index, 19.0% MSCI EAFE

101

Index, 3.6% MSCI Emerging Markets Index, 4.8% FTSE EPRA/NAREIT Global Index, 1.7% Barclays US Aggregate Bond Index, 0.4% Barclays US Aggregate Intermediate Bond Index, 0.4% Barclays US Government/Credit Bond Index, 0.2% Barclays US TIPS Index, 0.3% Citigroup Non-US Dollar World Government Bond Index, and 2.0% Barclays US Treasury Bills: 1 − 3 Months.

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.

102 

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 the Schwab Funds’ 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.

^© 2014 Charles Schwab & Co., Inc. All rights reserved.

Member SIPC^®

Printed on recycled paper.

MFR34720-08

00118059

Semiannual report dated April 30, 2014, enclosed.

Schwab Balanced Fund^tm

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This wrapper is not part of the shareholder report.

Schwab Balanced Fund^tm

Semiannual Report

April 30, 2014

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	21
Glossary	24

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 6 Months Ended April 30, 2014
Schwab Balanced Fundtm(Ticker Symbol: SWOBX)	4.20%
Balanced Blended Index	5.09%
Fund Category: Morningstar Moderate Allocation	4.65%
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.

The components that make up the composite index may vary over time. For index definition, please see the Glossary.

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.

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 regarding the Schwab Balanced Fund. The fund combines equity and fixed income strategies in U.S. markets, and is designed to provide income, diversified asset allocation, and an opportunity for long-term growth.

For the six-month reporting period ended April 30, 2014, the fund returned 4.2% compared with the 5.1% return of the Balanced Blended Index, reflecting a rally by U.S. stocks and modest returns for bonds. With the U.S. economy showing some signs of improvement, the Federal Reserve began “tapering” its stimulative policies in early 2014, while providing reassurances that low interest rates remain necessary for now. The Fed’s reassurances propped up the performance of stocks, with the S&P 500 Index returning 8.4% for the period, even as harsh winter weather temporarily slowed first-quarter economic activity.

The low level of interest rates and generally healthier economy led to modest performances by most fixed income securities. Bonds with lower credit ratings outperformed Treasuries as credit conditions remained favorable, while long-term bonds outperformed short-term bonds late in the period amid Fed reassurances that low interest rates are still required. Reflecting this environment, the Barclays U.S. Aggregate Bond Index returned 1.7%.

 Asset Class Performance Comparison % returns during the six months ended 4/30/2014

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

	8.36%	S&P 500® Index: measures U.S. large-cap stocks
	3.08%	Russell 2000® Index: measures U.S. small-cap stocks
	4.44%	MSCI EAFE® Index (Net): measures (in U.S. dollars) large-cap stocks in Europe, Australasia and the Far East
	1.74%	Barclays U.S. Aggregate Bond Index: measures the U.S. bond market
	0.02%	Barclays U.S. Treasury Bills 1-3 Months Index: 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.

For index definitions, please see the Glossary.

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-month reporting period ended April 30, 2014, the fund returned 4.2% compared with the 5.1% return of the Balanced Blended Index, reflecting a rally by U.S. stocks and modest returns for bonds.

For more information about the performance, holdings, and portfolio characteristics of the Schwab Balanced Fund, please continue reading this report. In addition, you can find further details about this fund by visiting www.schwabfunds.com, or by contacting us at 1-800-435-4000.

Sincerely,

For full definitions of the referenced indices, please see the Glossary.

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 04/30/14

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)		4.20	%		11.62	%		12.37	%		6.05	%
Balanced Blended Index		5.09	%		11.22	%		13.38	%		6.75	%
S&P 500® Index		8.36	%		20.44	%		19.14	%		7.67	%
Barclays U.S. Aggregate Bond Index		1.74	%		-0.26	%		4.88	%		4.83	%
Fund Category: Morningstar Moderate Allocation		4.65	%		10.51	%		12.95	%		6.28	%

Fund Expense Ratios³: Net 0.63%; Gross 0.73%

 Statistics

Number of Holdings	6
Portfolio Turnover Rate4	14%

 Asset Class Weightings % of Investments

Equity Funds – Large-Cap	50.6%
Fixed-Income Funds – Intermediate-Term Bond	36.4%
Equity Funds – Small-Cap	10.0%
Money Market Funds	3.0%
Total	100.0%

 Top Holdings % of Net Assets^5,6

Schwab Core Equity Fund	35.5%
Schwab Total Bond Market Fund	24.3%
Laudus U.S. Large Cap Growth Fund	15.0%
Schwab Intermediate-Term Bond Fund	12.0%
Laudus Small-Cap MarketMasters Fund, Select Shares	10.0%
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.

For index definitions, please see the Glossary.

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 many other asset classes.

The Laudus 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	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 0.63%. 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.
6	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 may incur two types of costs: (1) transaction costs, such as redemption fees; and (2) ongoing costs, including 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, 2013 and held through April 30, 2014.

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 the fund 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 the 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. Therefore, the hypothetical return lines of the table are useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, 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 11/1/13		at 4/30/14		11/1/13–4/30/14
Schwab Balanced Fundtm
Actual Return		0.00%	$	1,000.00	$	1,042.00	$	0.00
Hypothetical 5% Return		0.00%	$	1,000.00	$	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

	11/1/13–			11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–
	4/30/14*			10/31/13			10/31/12			10/31/11			10/31/10			10/31/09
Per-Share Data ($)
Net asset value at beginning of period		14.28			12.51			11.61			11.00			9.99			9.82
Income (loss) from investment operations:
Net investment income (loss)		0.10	1		0.14	1		0.19	1		0.17	1		0.17	1		0.22	1
Net realized and unrealized gains (losses)		0.50			1.85			0.88			0.63			1.03			0.64
Total from investment operations		0.60			1.99			1.07			0.80			1.20			0.86
Less distributions:
Distributions from net investment income		(0.21	)		(0.22	)		(0.17	)		(0.19	)		(0.19	)		(0.37	)
Distributions from net realized gains		—			—			—			—			—			(0.32	)
Total distributions		(0.21	)		(0.22	)		(0.17	)		(0.19	)		(0.19	)		(0.69	)
Net asset value at end of period		14.67			14.28			12.51			11.61			11.00			9.99
Total return (%)		4.20	2		16.13			9.36			7.28			12.08			9.45
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses3		0.00	4,5		0.00	4		0.00	4		0.00	4		0.00	4		0.00
Gross operating expenses3		0.09	5		0.10			0.16			0.16			0.20			0.17
Net investment income (loss)		1.43	5		1.06			1.54			1.52			1.67			2.41
Portfolio turnover rate		14	2		33			38			53			8			21
Net assets, end of period ($ x 1,000,000)		199			165			117			109			88			86

* Unaudited.

¹ Calculated based on the average shares outstanding during the period.

² Not annualized.

³ The expenses incurred by underlying funds in which the fund invests are not included in this ratio.

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 Annualized.

8 See financial notes

 Schwab Balanced Fund

Portfolio Holdings as of April 30, 2014 (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		168,532,925		198,292,907
	99	.8%	Total Investments		168,532,925		198,292,907
	0	.2%	Other Assets and Liabilities, Net				469,162
	100	.0%	Net Assets				198,762,069

	Number		Value
Security	of Shares		($)
Other Investment Companies 99.8% of net assets
Equity Funds 60.5%
Large-Cap 50.5%
Laudus U.S. Large Cap Growth Fund *(a)		1,679,811		29,833,439
Schwab Core Equity Fund (a)		3,013,100		70,536,674
				100,370,113
Small-Cap 10.0%
Laudus Small-Cap MarketMasters Fund, Select Shares *(a)		1,127,113		19,916,083
				120,286,196
Fixed-Income Funds 36.3%
Intermediate-Term Bond 36.3%
Schwab Intermediate-Term Bond Fund (a)		2,332,960		23,772,862
Schwab Total Bond Market Fund (a)		5,124,177		48,320,990
				72,093,852
Money Market Fund 3.0%
State Street Institutional U.S. Government Money Market Fund, Institutional Class 0.00% (b)		5,912,859		5,912,859
Total Other Investment Companies
(Cost $168,532,925)				198,292,907
End of Investments.

At 04/30/14, the tax basis cost of the fund’s investments was $171,231,822 and the unrealized appreciation and depreciation were $27,231,564 and ($170,479), respectively, with a net unrealized appreciation of $27,061,085.

*	Non-income producing security.
(a)	Issuer is affiliated with the fund’s adviser.
(b)	The rate shown is the 7-day yield.

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2014 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Other Significant		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Other Investment Companies1		$198,292,907		$—		$—		$198,292,907
Total		$198,292,907		$—		$—		$198,292,907

¹ As categorized in portfolio holdings.

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, 2014.

See financial notes 9

 Schwab Balanced Fund

Statement of

Assets and Liabilities

As of April 30, 2014; unaudited

Assets
Investments in affiliated underlying funds, at value (cost $162,620,066)		$192,380,048
Investments in unaffiliated issuers, at value (cost $5,912,859)	+	5,912,859
Total investments, at value (cost $168,532,925)		198,292,907
Receivables:
Investments sold		880,000
Fund shares sold		836,578
Dividends		131,270
Due from investment adviser		1,052
Prepaid expenses	+	2,007
Total assets		200,143,814
Liabilities
Payables:
Investments bought		1,151,301
Fund shares redeemed		198,544
Accrued expenses	+	31,900
Total liabilities		1,381,745
Net Assets
Total assets		200,143,814
Total liabilities	−	1,381,745
Net assets		$198,762,069
Net Assets by Source
Capital received from investors		167,665,383
Distributions in excess of net investment income		(113,496	)
Net realized capital gains		1,450,200
Net unrealized capital appreciation		29,759,982
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$198,762,069		13,550,892			$14.67

10 See financial notes

 Schwab Balanced Fund

Statement of

Operations

For the period November 1, 2013 through April 30, 2014; unaudited

Investment Income
Dividends received from affiliated underlying funds		$1,283,455
Expenses
Professional fees		18,921
Shareholder reports		18,206
Registration fees		14,446
Transfer agent fees		13,779
Portfolio accounting fees		5,490
Independent trustees’ fees		3,404
Custodian fees		1,642
Interest expense		62
Other expenses	+	1,950
Total expenses		77,900
Expense reduction by CSIM	−	77,838
Net expenses	−	62
Net investment income		1,283,393
Realized and Unrealized Gains (Losses)
Realized capital gain distributions received from affiliated underlying funds		5,843,410
Net realized gains on sales of affiliated underlying funds	+	1,573,294
Net realized gains		7,416,704
Net change in unrealized appreciation (depreciation) on affiliated underlying funds	+	(1,287,207	)
Net realized and unrealized gains		6,129,497
Increase in net assets resulting from operations		$7,412,890

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

11/1/13-4/30/14				11/1/12-10/31/13
Net investment income		$1,283,393			$1,542,751
Net realized gains		7,416,704			635,878
Net change in unrealized appreciation (depreciation)	+	(1,287,207	)		19,300,297
Increase in net assets from operations		7,412,890			21,478,926
Distributions to Shareholders
Distributions from net investment income		($2,313,152	)		($1,969,000	)

Transactions in Fund Shares

		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		VALUE			SHARES		VALUE
Shares sold			3,944,264		$57,099,943			6,476,156		$86,146,565
Shares reinvested			147,616		2,143,378			148,002		1,838,191
Shares redeemed	+		(2,083,617	)	(30,386,245	)		(4,466,396	)	(60,102,818	)
Net transactions in fund shares			2,008,263		$28,857,076			2,157,762		$27,881,938
Shares Outstanding and Net Assets
		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			11,542,629		$164,805,255			9,384,867		$117,413,391
Total increase	+		2,008,263		33,956,814			2,157,762		47,391,864
End of period			13,550,892		$198,762,069			11,542,629		$164,805,255
Distributions in excess of net investment income/Net investment income not yet distributed					($113,496	)				$916,263

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 a 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 U.S. Securities and 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 NAVs.

13

 Schwab Balanced Fund

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

•  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 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 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 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, 2014 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 and 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 generally makes 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.

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

15

 Schwab Balanced Fund

Financial Notes, unaudited (continued)

3. Risk Factors (continued):

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. 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 select or allocate assets that could cause the fund to underperform or otherwise not meet its objective. 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 performance also will lag those investments.

•  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 performance also will lag those investments.

•  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 longer an underlying fund’s duration, the more sensitive to interest rate movements its share price is likely to be. Because interest rates in the United States are at, or near, historically low levels, a change in a central bank’s monetary policy (e.g., tapering of the Federal Reserve Board’s quantitative easing program) or improving economic conditions may result in an increase in interest rates. 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.

16 

 Schwab Balanced Fund

Financial Notes, unaudited (continued)

3. Risk Factors (continued):

•  ETF 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.

•  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.

•  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); the imposition of economic sanctions or other government restrictions; differing accounting, auditing, financial reporting and legal standards and practices; differing securities market structures; and higher transaction costs. These risks may negatively impact the value or liquidity of the underlying fund’s investments, and could impair the underlying fund’s ability to meet its investment objective or invest in accordance with its investment strategy. To the extent an underlying fund’s investment in a single country or a limited number of countries represents a large percentage of the underlying fund’s assets, the underlying fund’s performance may be adversely affected by the economic, political and social conditions in those countries and it may be subject to increased price volatility.

•  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-Backed and Mortgage Pass-Through Securities Risk. Certain of the mortgage-backed securities in which an underlying fund may invest are not backed by the full faith and credit of the U.S. government and there can be no assurance that the U.S. government would provide financial support to its agencies or instrumentalities where it was not obligated to do so. Mortgage-backed securities tend to increase in value less than other debt securities when interest rates decline, but are subject to similar risk of decline in market value during periods of rising interest rates. Because of prepayment and extension risk, mortgage-backed securities react differently to changes in interest rates than other bonds.

17

 Schwab Balanced Fund

Financial Notes, unaudited (continued)

3. Risk Factors (continued):

Small movements in interest rates — both increases and decreases — may quickly and significantly affect the value of certain mortgage-backed securities. Transactions in mortgage pass-through securities primarily occur through to be announced (TBA) transactions. Default by or bankruptcy of a counterparty to a TBA transaction would expose an underlying fund to possible losses because of an adverse market action, expenses, or delays in connection with the purchase or sale of the pools of mortgage pass-through securities specified in the TBA transaction.

•  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.

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, 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, to limit the total annual fund operating expenses charged, excluding interest, taxes and certain non-routine expenses to 0.00%.

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 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, 2014, the Schwab Balanced Fund’s ownership percentages of other related funds’ shares are:

Laudus U.S. Large Cap Growth Fund	1.4%
Schwab Core Equity Fund	3.0%
Laudus Small-Cap MarketMasters Fund	10.6%
Schwab Intermediate-Term Bond Fund	6.6%
Schwab Total Bond Market Fund	5.0%

18 

 Schwab Balanced Fund

Financial Notes, unaudited (continued)

4. Affiliates and Affiliated Transactions (continued):

Below is a summary of the fund’s transactions with its affiliated underlying funds during the period ended April 30, 2014.

	Balance							Balance				Realized		Distributions
	of Shares							of Shares		Market		Gains (Losses)		Received*
	Held at		Gross		Gross			Held at		Value at		11/01/13		11/01/13
Underlying Funds	10/31/13		Purchases		Sales			04/30/14		04/30/14		to 04/30/14		to 04/30/14
Laudus U.S. Large Cap Growth Fund		1,405,004		502,248		(227,441	)		1,679,811		$29,833,439		$580,295		$1,709,774
Schwab Core Equity Fund		2,480,385		908,253		(375,538	)		3,013,100		70,536,674		698,521		4,679,307
Laudus Small-Cap MarketMasters Fund, Select Shares		936,684		302,404		(111,975	)		1,127,113		19,916,083		262,941		—
Schwab Intermediate-Term Bond Fund		1,943,421		784,086		(394,547	)		2,332,960		23,772,862		2,379		226,284
Schwab Total Bond Market Fund		4,226,692		1,511,625		(614,140	)		5,124,177		48,320,990		29,158		511,500
Total											$192,380,048		$1,573,294		$7,126,865

* 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.

5. Board of Trustees:

The Board may include people who are officers and/or directors of CSIM 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 on the fund’s 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, 2014, purchases and sales/maturities of securities (excluding short-term obligations) were as follows:

Purchases of Securities		Sales/Maturities of Securities
	$56,886,339		$24,555,000

19

 Schwab Balanced Fund

Financial Notes, unaudited (continued)

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
(11/1/13-4/30/14)		(11/1/12-10/31/13)
	$5,326		$6,089

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, 2013, the fund had capital loss carryforwards of $3,288,811 available to offset future net capital gains before October 31, 2017.

For the year ended October 31, 2013, the fund had capital losses utilized as follows:

Capital losses utilized $784,946

As of October 31, 2013, 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, 2013, 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.

20 

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 97 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).	76	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).	76	Director, Gilead Sciences, Inc. (2005 – present) Director, Monaco Coach Corporation (2005 – 2009)
David L. Mahoney 1954 Trustee (Trustee of Schwab Capital Trust since 2011.)	Private Investor.	76	Director, Symantec Corporation (2003 – present) Director, Corcept Therapeutics Incorporated (2004 – present)
Kiran M. Patel 1948 Trustee (Trustee of Schwab Capital Trust since 2011.)	Retired. Executive Vice President and General Manager of Small Business Group, Intuit, Inc. (financial software and services for consumers and small businesses) (Dec. 2008 – Sept. 2013).	76	Director, KLA-Tencor Corporation (2008 – present)
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).	76	Director, Eaton (2012 – present) Director and Chairman of the Audit Committee, Oneok Partners LP (2003 – 2013) Director, Oneok, Inc. (2009 – 2013) Lead Independent Director, Board of Cooper Industries (2002 – 2012)
Joseph H. Wender 1944 Trustee (Trustee of Schwab Capital Trust since 2008.)	Senior Consultant, Goldman Sachs & Co., Inc. (investment banking and securities firm) (Jan. 2008 – present); Partner, Colgin Partners, LLC (vineyards) (February 1998 – present).	76	Board Member and Chairman of the Audit Committee, Isis Pharmaceuticals (1994 – present)

21

 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.	76	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.	97	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, Chief Executive Officer (Dec. 2010 – present), and Chief Investment Officer (Sept. 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 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 (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).

22 

 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
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).
David Lekich 1964 Chief Legal Officer and Secretary (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 and Assistant Secretary (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 retire at age 72 or after twenty years as a trustee, whichever comes first. In addition, the retirement policy requires any independent trustee of 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 own stock of The Charles Schwab Corporation, the parent company of 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.

23

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.

Balanced Blended Index A custom blended index developed by CSIM that effective August 1, 2013 is composed of 50% S&P 500 Index, 10% Russell 2000 Index, 25% Barclays U.S. Aggregate Bond Index, 12% Barclays U.S. Aggregate Intermediate Bond Index and 3% Barclays U.S. Treasury Bills: 1 − 3 Months Index. Prior to August 1, 2013 the Balanced Blended Index was composed of 60% S&P 500 Index and 40% Barclays U.S. Aggregate Bond Index.

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 represents securities that are SEC-registered, taxable, and dollar denominated. The index covers the U.S. investment grade fixed rate bond market, with index components for government and corporate securities, mortgage pass-through securities, and asset-backed securities.

Barclays U.S. Treasury Bills 1 − 3 Months Index An index that includes all publicly issued zero-coupon U.S. Treasury Bills that have a remaining maturity of less than 3 months and more than 1 month, are rated investment grade, and have $250 million or more of outstanding face 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 capital gain or loss is considered unrealized appreciation or depreciation.

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 (Europe, Australasia, Far East) 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. It includes approximately 2000 of the smallest securities based on a combination of their market cap and current index membership.

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.

24 

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 the Schwab Funds’ 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.

^© 2014 Charles Schwab & Co., Inc. All rights reserved.

Member SIPC^®

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00118060

Semiannual report dated April 30, 2014, 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, 2014

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^®

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 6 Months Ended April 30, 2014
Schwab MarketTrack All Equity Portfoliotm(Ticker Symbol: SWEGX)	5.68%
All Equity Composite Index	5.91%
Fund Category: Morningstar Large Blend	7.41%
Performance Details	page 6
Schwab MarketTrack Growth Portfoliotm(Ticker Symbol: SWHGX)	4.95%
Growth Composite Index	5.19%
Fund Category: Morningstar Aggressive Allocation	5.02%
Performance Details	page 7
Schwab MarketTrack Balanced Portfoliotm(Ticker Symbol: SWBGX)	4.04%
Balanced Composite Index	4.33%
Fund Category: Morningstar Moderate Allocation	4.65%
Performance Details	page 8
Schwab MarketTrack Conservative Portfoliotm(Ticker Symbol: SWCGX)	3.15%
Conservative Composite Index	3.46%
Fund Category: Morningstar Conservative Allocation	3.61%
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.

The components that make up each of the composite indices may vary over time. For index definitions, please see the Glossary.

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.

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 regarding the Schwab MarketTrack Portfolios. The portfolios combine a variety of passive strategies in U.S. and international markets, seeking to provide diversification, while targeting varying degrees of risk.

For the six-month reporting period ended April 30, 2014, the portfolios generated returns that reflected a rally by stocks in U.S. and developed international markets, combined with modest returns for bonds. Efforts undertaken by the Federal Reserve, the European Central Bank, the Bank of Japan, and other central banks to keep interest rates low and stimulate economic growth provided a catalyst for these results. Stocks generally benefited from these policies, while bonds generated modest returns that reflected the low interest rate environment.

With the U.S. economy showing some signs of improvement, the Fed began “tapering” its stimulative policies in early 2014, but provided reassurances that low interest rates remain necessary for now. The Fed’s reassurances supported stocks, while concurrently helping longer-term bonds generate respectable returns late in the six months. Many major U.S. stock market indices reached record highs in April and finished at or near these levels by the end of the period, with the S&P 500 Index returning 8.4%, and the MSCI EAFE Index

 Asset Class Performance Comparison % returns during the six months ended 4/30/2014

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

	8.36%	S&P 500® Index: measures U.S. large-cap stocks
	3.08%	Russell 2000® Index: measures U.S. small-cap stocks
	4.44%	MSCI EAFE® Index (Net): measures (in U.S. dollars) large-cap stocks in Europe, Australasia and the Far East
	1.74%	Barclays U.S. Aggregate Bond Index: measures the U.S. bond market
	0.02%	Barclays U.S. Treasury Bills 1-3 Months Index: 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.

For index definitions, please see the Glossary.

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-month reporting period ended April 30, 2014, the portfolios generated returns that reflected a rally by stocks in U.S. and developed international markets, combined with modest returns for bonds.

returning 4.4%.¹ Representing the broad performance of U.S. fixed income securities, the Barclays U.S. Aggregate Bond Index returned 1.7%.

For more information about the performance, holdings, and portfolio characteristics of Schwab MarketTrack Portfolios, please continue reading this report. In addition, you can find further details about these funds by visiting www.schwabfunds.com, or by contacting us at 1-800-435-4000.

Sincerely,

For full definitions of the referenced indices, please see the Glossary.

¹ The total return cited is for the MSCI EAFE Index (Net), which is calculated net of foreign withholding taxes.

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 04/30/14

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 Portfoliotm (5/19/98)		5.68	%		17.68	%		17.45	%		7.53	%
All Equity Composite Index		5.91	%		17.48	%		17.68	%		7.86	%
S&P 500® Index		8.36	%		20.44	%		19.14	%		7.67	%
Fund Category: Morningstar Large Blend		7.41	%		19.35	%		17.82	%		7.17	%

Fund Expense Ratios³: Net 0.64%; Gross 0.66%

 Statistics

Number of Holdings	4
Portfolio Turnover Rate4	4%

 Asset Class Weightings % of Investments

Equity Funds – Large-Cap	44.7%
Equity Funds – International	29.8%
Equity Funds – Small-Cap	25.0%
Short-Term Investments	0.5%
Total	100.0%

 Top Holdings % of Net Assets^5,6

Schwab S&P 500 Index Fund	44.7%
Schwab International Index Fund	29.8%
Schwab Small-Cap Index Fund	25.0%
Total	99.5%

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.

For index definitions, please see the Glossary.

Portfolio holdings may have changed since the report date.

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

International investments are subject to additional risks such as currency fluctuation, geopolitical risk and the potential for illiquid markets.

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	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.
4	Not annualized.
5	This list is not a recommendation of any security by the investment adviser.
6	The holdings listed exclude any temporary liquidity investments.

6 Schwab MarketTrack Portfolios

Schwab MarketTrack Growth Portfolio™

Performance and Fund Facts as of 04/30/14

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 Portfoliotm (11/20/95)		4.95	%		14.22	%		14.94	%		6.87	%
Growth Composite Index		5.19	%		14.14	%		15.19	%		7.35	%
S&P 500® Index		8.36	%		20.44	%		19.14	%		7.67	%
Fund Category: Morningstar Aggressive Allocation		5.02	%		13.31	%		14.65	%		6.63	%

Fund Expense Ratios³: Net 0.66%; Gross 0.68%

 Statistics

Number of Holdings	7
Portfolio Turnover Rate4	3%

 Asset Class Weightings % of Investments

Equity Funds – Large-Cap	40.3%
Equity Funds – International	20.2%
Equity Funds – Small-Cap	19.9%
Fixed-Income Funds – Intermediate-Term Bond	14.8%
Short-Term Investments	3.3%
Money Market Funds	1.5%
Total	100.0%

 Top Holdings % of Net Assets^5,6

Schwab S&P 500 Index Fund	40.3%
Schwab International Index Fund	20.2%
Schwab Small-Cap Index Fund	19.9%
Schwab Total Bond Market Fund	14.8%
Schwab Value Advantage Money Fund, Institutional Prime Shares	1.5%
Total	96.7%

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.

For index definitions, please see the Glossary.

Portfolio holdings may have changed since the report date.

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

International investments are subject to additional risks such as currency fluctuation, geopolitical risk and the potential for illiquid markets.

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	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 0.16%. 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.
6	The holdings listed exclude any temporary liquidity investments.

Schwab MarketTrack Portfolios 7

Schwab MarketTrack Balanced Portfolio™

Performance and Fund Facts as of 04/30/14

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)		4.04	%		10.34	%		12.26	%		6.03	%
Balanced Composite Index		4.33	%		10.44	%		12.62	%		6.83	%
S&P 500® Index		8.36	%		20.44	%		19.14	%		7.67	%
Barclays U.S. Aggregate Bond Index		1.74	%		-0.26	%		4.88	%		4.83	%
Fund Category: Morningstar Moderate Allocation		4.65	%		10.51	%		12.95	%		6.28	%

Fund Expense Ratios³: Net 0.69%; Gross 0.71%

 Statistics

Number of Holdings	7
Portfolio Turnover Rate4	5%

 Asset Class Weightings % of Investments

Fixed-Income Funds – Intermediate-Term Bond	34.7%
Equity Funds – Large-Cap	30.3%
Equity Funds – International	15.2%
Equity Funds – Small-Cap	14.8%
Short-Term Investments	3.5%
Money Market Funds	1.5%
Total	100.0%

 Top Holdings % of Net Assets^5,6

Schwab Total Bond Market Fund	34.7%
Schwab S&P 500 Index Fund	30.3%
Schwab International Index Fund	15.2%
Schwab Small-Cap Index Fund	14.8%
Schwab Value Advantage Money Fund, Institutional Prime Shares	1.5%
Total	96.5%

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.

For index definitions, please see the Glossary.

Portfolio holdings may have changed since the report date.

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

International investments are subject to additional risks such as currency fluctuation, geopolitical risk and the potential for illiquid markets.

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	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.
4	Not annualized.
5	This list is not a recommendation of any security by the investment adviser.
6	The holdings listed exclude any temporary liquidity investments.

8 Schwab MarketTrack Portfolios

Schwab MarketTrack Conservative Portfolio™

Performance and Fund Facts as of 04/30/14

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)		3.15	%		6.45	%		9.49	%		5.09	%
Conservative Composite Index		3.46	%		6.81	%		10.00	%		6.21	%
S&P 500® Index		8.36	%		20.44	%		19.14	%		7.67	%
Barclays U.S. Aggregate Bond Index		1.74	%		-0.26	%		4.88	%		4.83	%
Fund Category: Morningstar Conservative Allocation		3.61	%		5.03	%		10.09	%		5.27	%

Fund Expense Ratios³: Net 0.72%; Gross 0.77%

 Statistics

Number of Holdings	7
Portfolio Turnover Rate4	4%

 Asset Class Weightings % of Investments

Fixed-Income Funds – Intermediate-Term Bond	54.8%
Equity Funds – Large-Cap	20.3%
Equity Funds – International	10.2%
Equity Funds – Small-Cap	9.8%
Short-Term Investments	3.3%
Money Market Funds	1.6%
Total	100.0%

 Top Holdings % of Net Assets^5,6

Schwab Total Bond Market Fund	54.6%
Schwab S&P 500 Index Fund	20.3%
Schwab International Index Fund	10.2%
Schwab Small-Cap Index Fund	9.8%
Schwab Value Advantage Money Fund, Institutional Prime Shares	1.6%
Total	96.5%

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.

For index definitions, please see the Glossary.

Portfolio holdings may have changed since the report date.

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

International investments are subject to additional risks such as currency fluctuation, geopolitical risk and the potential for illiquid markets.

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	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.
4	Not annualized.
5	This list is not a recommendation of any security by the investment adviser.
6	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 may incur two types of costs: (1) transaction costs, such as redemption fees; and (2) ongoing costs, including 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, 2013 and held through April 30, 2014.

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 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 a 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. Therefore, the hypothetical return lines of the table are useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, 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 11/1/13		at 4/30/14		11/1/13–4/30/14
Schwab MarketTrack All Equity Portfoliotm
Actual Return		0.50%	$	1,000.00	$	1,056.80	$	2.55
Hypothetical 5% Return		0.50%	$	1,000.00	$	1,022.32	$	2.51
Schwab MarketTrack Growth Portfoliotm
Actual Return		0.50%	$	1,000.00	$	1,049.50	$	2.54
Hypothetical 5% Return		0.50%	$	1,000.00	$	1,022.32	$	2.51
Schwab MarketTrack Balanced Portfoliotm
Actual Return		0.50%	$	1,000.00	$	1,040.40	$	2.53
Hypothetical 5% Return		0.50%	$	1,000.00	$	1,022.32	$	2.51
Schwab MarketTrack Conservative Portfoliotm
Actual Return		0.50%	$	1,000.00	$	1,031.50	$	2.52
Hypothetical 5% Return		0.50%	$	1,000.00	$	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

	11/1/13–			11/1/12–			11/1/11–		11/1/10–			11/1/09–			11/1/08–
	4/30/14*			10/31/13			10/31/12		10/31/11			10/31/10			10/31/09
Per-Share Data ($)
Net asset value at beginning of period		15.99			12.79			11.52		11.30			9.82			9.44
Income (loss) from investment operations:
Net investment income (loss)		0.25			0.27			0.25		0.16			0.12			0.30
Net realized and unrealized gains (losses)		0.66			3.27			1.02		0.27			1.50			0.83
Total from investment operations		0.91			3.54			1.27		0.43			1.62			1.13
Less distributions:
Distributions from net investment income		(0.27	)		(0.34	)		—		(0.21	)		(0.14	)		(0.23	)
Distributions from net realized gains		—			—			—		—			—			(0.52	)
Total distributions		(0.27	)		(0.34	)		—		(0.21	)		(0.14	)		(0.75	)
Net asset value at end of period		16.63			15.99			12.79		11.52			11.30			9.82
Total return (%)		5.68	1		28.37			11.02		3.76			16.62			13.54
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses2		0.50	3		0.50			0.50		0.50			0.50			0.50
Gross operating expenses2		0.51	3		0.52			0.54		0.53			0.54			0.67
Net investment income (loss)		3.05	3		1.84			1.93		1.37			1.14			3.46
Portfolio turnover rate		4	1		6			6		12			8			10
Net assets, end of period ($ x 1,000,000)		616			586			475		476			489			461

* 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, 2014 (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	.5%	Other Investment Companies		395,337,967		613,508,724
	0	.5%	Short-Term Investment		2,773,656		2,773,656
	100	.0%	Total Investments		398,111,623		616,282,380
	0	.0%	Other Assets and Liabilities, Net				184,502
	100	.0%	Net Assets				616,466,882

	Number		Value
Security	of Shares		($)
Other Investment Companies 99.5% of net assets
Equity Funds 99.5%
International 29.8%
Schwab International Index Fund (a)		9,038,425		183,660,798
Large-Cap 44.7%
Schwab S&P 500 Index Fund (a)		9,320,295		275,601,111
Small-Cap 25.0%
Schwab Small-Cap Index Fund (a)		5,751,186		154,246,815
Total Other Investment Companies
(Cost $395,337,967)				613,508,724
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investment 0.5% of net assets
Time Deposit 0.5%
DNB
0.03%, 05/01/14		2,773,656		2,773,656
Total Short-Term Investment
(Cost $2,773,656)				2,773,656
End of Investments.

At 04/30/14, the tax basis cost of the fund’s investments was $412,622,696 and the unrealized appreciation and depreciation were $203,659,684 and ($0), respectively, with a net unrealized appreciation of $203,659,684.

(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, 2014 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Other Significant		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Other Investment Companies1		$613,508,724		$—		$—		$613,508,724
Short-Term Investment1		—		2,773,656		—		2,773,656
Total		$613,508,724		$2,773,656		$—		$616,282,380

¹ As categorized in portfolio holdings.

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, 2014.

12 See financial notes

 Schwab MarketTrack All Equity Portfolio

Statement of

Assets and Liabilities

As of April 30, 2014; unaudited

Assets
Investments in affiliated underlying funds, at value (cost $395,337,967)		$613,508,724
Investments in unaffiliated issuers, at value (cost $2,773,656)	+	2,773,656
Total investments, at value (cost $398,111,623)		616,282,380
Receivables:
Investments sold		6,500,000
Fund shares sold		311,631
Interest		2
Prepaid expenses	+	8,162
Total assets		623,102,175
Liabilities
Payables:
Investments bought		6,400,000
Investment adviser and administrator fees		11,351
Shareholder service fees		13,575
Fund shares redeemed		164,946
Accrued expenses	+	45,421
Total liabilities		6,635,293
Net Assets
Total assets		623,102,175
Total liabilities	−	6,635,293
Net assets		$616,466,882
Net Assets by Source
Capital received from investors		440,340,936
Net investment income not yet distributed		9,140,084
Net realized capital losses		(51,184,895	)
Net unrealized capital appreciation		218,170,757
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$616,466,882		37,073,268			$16.63

See financial notes 13

 Schwab MarketTrack All Equity Portfolio

Statement of

Operations

For the period November 1, 2013 through April 30, 2014; unaudited

Investment Income
Dividends received from affiliated underlying funds		$10,641,678
Interest	+	409
Total investment income		10,642,087
Expenses
Investment adviser and administrator fees		690,009
Shareholder service fees		731,611
Shareholder reports		31,474
Professional fees		20,801
Transfer agent fees		18,468
Registration fees		13,376
Portfolio accounting fees		13,163
Custodian fees		5,861
Independent trustees’ fees		4,478
Other expenses	+	7,652
Total expenses		1,536,893
Expense reduction by CSIM and its affiliates	−	37,547
Net expenses	−	1,499,346
Net investment income		9,142,741
Realized and Unrealized Gains (Losses)
Realized capital gain distributions received from affiliated underlying funds		6,726,205
Net realized gains on sales of affiliated underlying funds	+	2,153,686
Net realized gains		8,879,891
Net change in unrealized appreciation (depreciation) on affiliated underlying funds	+	15,042,373
Net realized and unrealized gains		23,922,264
Increase in net assets resulting from operations		$33,065,005

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

11/1/13-4/30/14				11/1/12-10/31/13
Net investment income		$9,142,741			$9,727,932
Net realized gains		8,879,891			7,228,288
Net change in unrealized appreciation (depreciation)	+	15,042,373			114,728,861
Increase in net assets from operations		33,065,005			131,685,081
Distributions to Shareholders
Distributions from net investment income		($9,729,315	)		($12,561,634	)

Transactions in Fund Shares

		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		VALUE			SHARES		VALUE
Shares sold			2,259,977		$36,904,727			4,265,588		$60,479,156
Shares reinvested			553,923		9,089,878			918,465		11,765,529
Shares redeemed	+		(2,387,224	)	(39,003,872	)		(5,656,792	)	(79,997,553	)
Net transactions in fund shares			426,676		$6,990,733			(472,739	)	($7,752,868	)
Shares Outstanding and Net Assets
		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			36,646,592		$586,140,459			37,119,331		$474,769,880
Total increase or decrease	+		426,676		30,326,423			(472,739	)	111,370,579
End of period			37,073,268		$616,466,882			36,646,592		$586,140,459
Net investment income not yet distributed					$9,140,084					$9,726,658

See financial notes 15

Schwab MarketTrack Growth Portfolio™

Financial Statements

Financial Highlights

	11/1/13–			11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–
	4/30/14*			10/31/13			10/31/12			10/31/11			10/31/10			10/31/09
Per-Share Data ($)
Net asset value at beginning of period		21.67			18.08			16.85			16.35			14.51			13.71
Income (loss) from investment operations:
Net investment income (loss)		0.29			0.34			0.30			0.24			0.19			0.39
Net realized and unrealized gains (losses)		0.78			3.60			1.35			0.51			1.95			1.25
Total from investment operations		1.07			3.94			1.65			0.75			2.14			1.64
Less distributions:
Distributions from net investment income		(0.31	)		(0.35	)		(0.42	)		(0.25	)		(0.30	)		(0.40	)
Distributions from net realized gains		—			—			—			—			—			(0.44	)
Total distributions		(0.31	)		(0.35	)		(0.42	)		(0.25	)		(0.30	)		(0.84	)
Net asset value at end of period		22.43			21.67			18.08			16.85			16.35			14.51
Total return (%)		4.95	1		22.14			10.03			4.55			14.86			12.95
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses2		0.50	3		0.50			0.50			0.50			0.50			0.50
Gross operating expenses2		0.51	3		0.52			0.53			0.52			0.52			0.66
Net investment income (loss)		2.64	3		1.71			1.78			1.39			1.25			3.03
Portfolio turnover rate		3	1		9			9			17			14			23
Net assets, end of period ($ x 1,000,000)		718			680			566			562			549			507

* 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, 2014 (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%	Other Investment Companies		415,826,540		694,346,478
	3	.3%	Short-Term Investments		23,480,243		23,480,243
	100	.0%	Total Investments		439,306,783		717,826,721
	0	.0%	Other Assets and Liabilities, Net				7,295
	100	.0%	Net Assets				717,834,016

	Number		Value
Security	of Shares		($)
Other Investment Companies 96.7% of net assets
Equity Funds 80.4%
International 20.2%
Schwab International Index Fund (a)		7,135,864		145,000,753
Large-Cap 40.3%
Schwab S&P 500 Index Fund (a)		9,787,042		289,402,839
Small-Cap 19.9%
Schwab Small-Cap Index Fund (a)		5,329,348		142,933,119
				577,336,711
Fixed-Income Fund 14.8%
Intermediate-Term Bond 14.8%
Schwab Total Bond Market Fund (a)		11,236,315		105,958,449
Money Market Fund 1.5%
Schwab Value Advantage Money Fund, Institutional Prime Shares 0.01% (a)(b)		11,051,318		11,051,318
Total Other Investment Companies
(Cost $415,826,540)				694,346,478
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 3.3% of net assets
Time Deposits 3.3%
Australia & New Zealand Banking Group Ltd.
0.03%, 05/01/14		21,483,201		21,483,201
Bank of Tokyo - Mitsubishi UFJ
0.03%, 05/01/14		1,997,042		1,997,042
Total Short-Term Investments
(Cost $23,480,243)				23,480,243
End of Investments.

At 04/30/14, the tax basis cost of the fund’s investments was $443,761,963 and the unrealized appreciation and depreciation were $274,064,758 and ($0), respectively, with a net unrealized appreciation of $274,064,758.

(a)	Issuer is affiliated with the fund’s adviser.
(b)	The rate shown is the 7-day yield.

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2014 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Other Significant		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Other Investment Companies1		$694,346,478		$—		$—		$694,346,478
Short-Term Investments1		—		23,480,243		—		23,480,243
Total		$694,346,478		$23,480,243		$—		$717,826,721

¹ As categorized in portfolio holdings.

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, 2014.

See financial notes 17

 Schwab MarketTrack Growth Portfolio

Statement of

Assets and Liabilities

As of April 30, 2014; unaudited

Assets
Investments in affiliated underlying funds, at value (cost $415,826,540)		$694,346,478
Investments in unaffiliated issuers, at value (cost $23,480,243)	+	23,480,243
Total investments, at value (cost $439,306,783)		717,826,721
Receivables:
Investments sold		3,400,000
Fund shares sold		1,120,182
Dividends		200,477
Interest		20
Prepaid expenses	+	10,353
Total assets		722,557,753
Liabilities
Payables:
Investments bought		3,300,811
Investment adviser and administrator fees		13,523
Shareholder service fees		15,757
Fund shares redeemed		1,333,138
Accrued expenses	+	60,508
Total liabilities		4,723,737
Net Assets
Total assets		722,557,753
Total liabilities	−	4,723,737
Net assets		$717,834,016
Net Assets by Source
Capital received from investors		437,412,363
Distributions in excess of net investment income		(1,071,098	)
Net realized capital gains		2,972,813
Net unrealized capital appreciation		278,519,938
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$717,834,016		32,002,464			$22.43

18 See financial notes

 Schwab MarketTrack Growth Portfolio

Statement of

Operations

For the period November 1, 2013 through April 30, 2014; unaudited

Investment Income
Dividends received from affiliated underlying funds		$10,895,269
Interest	+	3,557
Total investment income		10,898,826
Expenses
Investment adviser and administrator fees		797,541
Shareholder service fees		850,135
Shareholder reports		29,462
Professional fees		21,701
Transfer agent fees		18,135
Registration fees		15,325
Portfolio accounting fees		13,800
Custodian fees		6,910
Independent trustees’ fees		4,712
Other expenses	+	7,838
Total expenses		1,765,559
Expense reduction by CSIM and its affiliates	−	31,775
Net expenses	−	1,733,784
Net investment income		9,165,042
Realized and Unrealized Gains (Losses)
Realized capital gain distributions received from affiliated underlying funds		6,228,769
Net realized gains on sales of affiliated underlying funds		3,210,351
Net realized gains on unaffiliated investments	+	62,378
Net realized gains		9,501,498
Net change in unrealized appreciation (depreciation) on affiliated underlying funds	+	14,800,835
Net realized and unrealized gains		24,302,333
Increase in net assets resulting from operations		$33,467,375

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

11/1/13-4/30/14				11/1/12-10/31/13
Net investment income		$9,165,042			$10,557,296
Net realized gains		9,501,498			11,273,795
Net change in unrealized appreciation (depreciation)	+	14,800,835			101,623,253
Increase in net assets from operations		33,467,375			123,454,344
Distributions to Shareholders1
Distributions from net investment income		($9,625,225	)		($10,641,577	)

Transactions in Fund Shares¹

		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		VALUE			SHARES		VALUE
Shares sold			2,239,985		$49,534,288			3,956,940		$78,029,608
Shares reinvested			411,732		9,099,268			556,707		10,081,957
Shares redeemed	+		(2,032,451	)	(44,858,917	)		(4,460,927	)	(87,149,494	)
Net transactions in fund shares			619,266		$13,774,639			52,720		$962,071
Shares Outstanding and Net Assets
		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			31,383,198		$680,217,227			31,330,478		$566,442,389
Total increase	+		619,266		37,616,789			52,720		113,774,838
End of period			32,002,464		$717,834,016			31,383,198		$680,217,227
Distributions in excess of net investment income					($1,071,098	)				($610,915	)

¹ Effective December 6, 2012, the P Share class was terminated.

20 See financial notes

Schwab MarketTrack Balanced Portfolio™

Financial Statements

Financial Highlights

	11/1/13–			11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–
	4/30/14*			10/31/13			10/31/12			10/31/11			10/31/10			10/31/09
Per-Share Data ($)
Net asset value at beginning of period		18.55			16.33			15.41			14.96			13.54			12.74
Income (loss) from investment operations:
Net investment income (loss)		0.23			0.31			0.29			0.25			0.23			0.38
Net realized and unrealized gains (losses)		0.52			2.23			1.01			0.46			1.50			1.11
Total from investment operations		0.75			2.54			1.30			0.71			1.73			1.49
Less distributions:
Distributions from net investment income		(0.27	)		(0.32	)		(0.38	)		(0.26	)		(0.31	)		(0.44	)
Distributions from net realized gains		(0.12	)		—			—			—			—			(0.25	)
Total distributions		(0.39	)		(0.32	)		(0.38	)		(0.26	)		(0.31	)		(0.69	)
Net asset value at end of period		18.91			18.55			16.33			15.41			14.96			13.54
Total return (%)		4.04	1		15.82			8.61			4.80			12.92			12.41
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses2		0.50	3		0.50			0.50			0.50			0.50			0.50
Gross operating expenses2		0.51	3		0.52			0.53			0.52			0.52			0.66
Net investment income (loss)		2.39	3		1.75			1.86			1.64			1.59			3.09
Portfolio turnover rate		5	1		12			12			25			22			30
Net assets, end of period ($ x 1,000,000)		525			481			425			432			450			434

* 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, 2014 (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		341,963,789		506,986,785
	3	.5%	Short-Term Investments		18,163,796		18,163,796
	100	.0%	Total Investments		360,127,585		525,150,581
	(0	.0%)	Other Assets and Liabilities, Net				(92,042	)
	100	.0%	Net Assets				525,058,539

	Number		Value
Security	of Shares		($)
Other Investment Companies 96.5% of net assets
Equity Funds 60.3%
International 15.2%
Schwab International Index Fund (a)		3,921,895		79,692,916
Large-Cap 30.3%
Schwab S&P 500 Index Fund (a)		5,374,591		158,926,644
Small-Cap 14.8%
Schwab Small-Cap Index Fund (a)		2,908,547		78,007,220
				316,626,780
Fixed-Income Fund 34.7%
Intermediate-Term Bond 34.7%
Schwab Total Bond Market Fund (a)		19,334,675		182,325,988
Money Market Fund 1.5%
Schwab Value Advantage Money Fund, Institutional Prime Shares 0.01% (a)(b)		8,034,017		8,034,017
Total Other Investment Companies
(Cost $341,963,789)				506,986,785
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 3.5% of net assets
Time Deposits 3.5%
Bank of Tokyo - Mitsubishi UFJ
0.03%, 05/01/14		15,702,830		15,702,830
Wells Fargo
0.03%, 05/01/14		2,460,966		2,460,966
Total Short-Term Investments
(Cost $18,163,796)				18,163,796
End of Investments.

At 04/30/14, the tax basis cost of the fund’s investments was $ 367,657,009 and the unrealized appreciation and depreciation were $157,493,572 and ($0), respectively, with a net unrealized appreciation of $157,493,572.

(a)	Issuer is affiliated with the fund’s adviser.
(b)	The rate shown is the 7-day yield.

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2014 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Other Significant		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Other Investment Companies1		$506,986,785		$—		$—		$506,986,785
Short-Term Investments1		—		18,163,796		—		18,163,796
Total		$506,986,785		$18,163,796		$—		$525,150,581

¹ As categorized in portfolio holdings.

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, 2014.

22 See financial notes

 Schwab MarketTrack Balanced Portfolio

Statement of

Assets and Liabilities

As of April 30, 2014; unaudited

Assets
Investments in affiliated underlying funds, at value (cost $341,963,789)		$506,986,785
Investments in unaffiliated issuers, at value (cost $18,163,796)	+	18,163,796
Total investments, at value (cost $360,127,585)		525,150,581
Receivables:
Investments sold		2,100,000
Fund shares sold		493,101
Dividends		344,323
Interest		15
Prepaid expenses	+	7,631
Total assets		528,095,651
Liabilities
Payables:
Investments bought		2,844,951
Investment adviser and administrator fees		9,845
Shareholder service fees		11,370
Fund shares redeemed		128,954
Accrued expenses	+	41,992
Total liabilities		3,037,112
Net Assets
Total assets		528,095,651
Total liabilities	−	3,037,112
Net assets		$525,058,539
Net Assets by Source
Capital received from investors		361,948,298
Net investment income not yet distributed		153,096
Net realized capital losses		(2,065,851	)
Net unrealized capital appreciation		165,022,996
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$525,058,539		27,763,778			$18.91

See financial notes 23

 Schwab MarketTrack Balanced Portfolio

Statement of

Operations

For the period November 1, 2013 through April 30, 2014; unaudited

Investment Income
Dividends received from affiliated underlying funds		$7,189,852
Interest	+	2,487
Total investment income		7,192,339
Expenses
Investment adviser and administrator fees		571,491
Shareholder service fees		610,663
Professional fees		20,305
Shareholder reports		15,245
Transfer agent fees		14,255
Registration fees		13,517
Portfolio accounting fees		12,181
Custodian fees		5,463
Independent trustees’ fees		4,198
Other expenses	+	5,727
Total expenses		1,273,045
Expense reduction by CSIM and its affiliates	−	30,674
Net expenses	−	1,242,371
Net investment income		5,949,968
Realized and Unrealized Gains (Losses)
Realized capital gain distributions received from affiliated underlying funds		3,305,085
Net realized gains on sales of affiliated underlying funds		2,235,817
Net realized gains on unaffiliated investments	+	41,638
Net realized gains		5,582,540
Net change in unrealized appreciation (depreciation) on affiliated underlying funds	+	8,803,872
Net realized and unrealized gains		14,386,412
Increase in net assets resulting from operations		$20,336,380

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

11/1/13-4/30/14				11/1/12-10/31/13
Net investment income		$5,949,968			$7,871,154
Net realized gains		5,582,540			11,848,026
Net change in unrealized appreciation (depreciation)	+	8,803,872			46,183,726
Increase in net assets from operations		20,336,380			65,902,906
Distributions to Shareholders
Distributions from net investment income		(6,922,856	)		(8,153,238	)
Distributions from net realized gains	+	(3,022,728	)		—
Total distributions		($9,945,584	)		($8,153,238	)

Transactions in Fund Shares

		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		VALUE			SHARES		VALUE
Shares sold			3,642,661		$67,586,369			3,770,528		$65,235,947
Shares reinvested			501,199		9,312,269			467,584		7,607,583
Shares redeemed	+		(2,312,369	)	(43,211,517	)		(4,331,142	)	(74,715,528	)
Net transactions in fund shares			1,831,491		$33,687,121			(93,030	)	($1,871,998	)
Shares Outstanding and Net Assets
		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			25,932,287		$480,980,622			26,025,317		$425,102,952
Total increase or decrease	+		1,831,491		44,077,917			(93,030	)	55,877,670
End of period			27,763,778		$525,058,539			25,932,287		$480,980,622
Net investment income not yet distributed					$153,096					$1,125,984

See financial notes 25

Schwab MarketTrack Conservative Portfolio™

Financial Statements

Financial Highlights

	11/1/13–			11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–
	4/30/14*			10/31/13			10/31/12			10/31/11			10/31/10			10/31/09
Per-Share Data ($)
Net asset value at beginning of period		15.34			14.23			13.59			13.22			12.15			11.34
Income (loss) from investment operations:
Net investment income (loss)		0.17			0.26			0.26			0.25			0.24			0.37
Net realized and unrealized gains (losses)		0.31			1.10			0.69			0.37			1.08			0.91
Total from investment operations		0.48			1.36			0.95			0.62			1.32			1.28
Less distributions:
Distributions from net investment income		(0.18	)		(0.25	)		(0.31	)		(0.25	)		(0.25	)		(0.38	)
Distributions from net realized gains		—			—			—			—			—			(0.09	)
Total distributions		(0.18	)		(0.25	)		(0.31	)		(0.25	)		(0.25	)		(0.47	)
Net asset value at end of period		15.64			15.34			14.23			13.59			13.22			12.15
Total return (%)		3.15	1		9.71			7.07			4.72			10.98			11.72
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses2		0.50	3		0.50			0.50			0.50			0.50			0.50
Gross operating expenses2		0.54	3		0.55			0.55			0.55			0.56			0.68
Net investment income (loss)		2.18	3		1.78			1.96			1.84			1.93			3.31
Portfolio turnover rate		4	1		15			19			30			25			25
Net assets, end of period ($ x 1,000,000)		220			203			189			198			194			181

* 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, 2014 (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		162,216,181		212,114,685
	3	.3%	Short-Term Investments		7,299,477		7,299,477
	99	.8%	Total Investments		169,515,658		219,414,162
	0	.2%	Other Assets and Liabilities, Net				440,869
	100	.0%	Net Assets				219,855,031

	Number		Value
Security	of Shares		($)
Other Investment Companies 96.5% of net assets
Equity Funds 40.3%
International 10.2%
Schwab International Index Fund (a)		1,103,142		22,415,837
Large-Cap 20.3%
Schwab S&P 500 Index Fund (a)		1,505,242		44,509,993
Small-Cap 9.8%
Schwab Small-Cap Index Fund (a)		803,914		21,560,962
				88,486,792
Fixed-Income Fund 54.6%
Intermediate-Term Bond 54.6%
Schwab Total Bond Market Fund (a)		12,740,216		120,140,241
Money Market Fund 1.6%
Schwab Value Advantage Money Fund, Institutional Prime Shares 0.01% (a)(b)		3,487,652		3,487,652
Total Other Investment Companies
(Cost $162,216,181)				212,114,685
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 3.3% of net assets
Time Deposits 3.3%
Bank of Tokyo - Mitsubishi UFJ
0.03%, 05/01/14		6,568,640		6,568,640
Wells Fargo
0.03%, 05/01/14		730,837		730,837
Total Short-Term Investments
(Cost $7,299,477)				7,299,477
End of Investments.

At 04/30/14, the tax basis cost of the fund’s investments was $177,173,223 and the unrealized appreciation and depreciation were $42,240,939 and ($0), respectively, with a net unrealized appreciation of $42,240,939.

(a)	Issuer is affiliated with the fund’s adviser.
(b)	The rate shown is the 7-day yield.

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2014 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Other Significant		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Other Investment Companies1		$212,114,685		$—		$—		$212,114,685
Short-Term Investments1		—		7,299,477		—		7,299,477
Total		$212,114,685		$7,299,477		$—		$219,414,162

¹ As categorized in portfolio holdings.

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, 2014.

See financial notes 27

 Schwab MarketTrack Conservative Portfolio

Statement of

Assets and Liabilities

As of April 30, 2014; unaudited

Assets
Investments in affiliated underlying funds, at value (cost $162,216,181)		$212,114,685
Investments in unaffiliated issuers, at value (cost $7,299,477)	+	7,299,477
Total investments, at value (cost $169,515,658)		219,414,162
Receivables:
Investments sold		560,000
Fund shares sold		602,852
Dividends		226,750
Interest		6
Prepaid expenses	+	3,199
Total assets		220,806,969
Liabilities
Payables:
Investments bought		777,170
Investment adviser and administrator fees		3,692
Shareholder service fees		4,436
Fund shares redeemed		138,356
Accrued expenses	+	28,284
Total liabilities		951,938
Net Assets
Total assets		220,806,969
Total liabilities	−	951,938
Net assets		$219,855,031
Net Assets by Source
Capital received from investors		178,564,457
Net investment income not yet distributed		115,105
Net realized capital losses		(8,723,035	)
Net unrealized capital appreciation		49,898,504
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$219,855,031		14,054,059			$15.64

28 See financial notes

 Schwab MarketTrack Conservative Portfolio

Statement of

Operations

For the period November 1, 2013 through April 30, 2014; unaudited

Investment Income
Dividends received from affiliated underlying funds		$2,784,048
Interest	+	1,040
Total investment income		2,785,088
Expenses
Investment adviser and administrator fees		239,324
Shareholder service fees		254,828
Professional fees		19,364
Transfer agent fees		12,607
Registration fees		11,749
Portfolio accounting fees		9,457
Shareholder reports		7,048
Independent trustees’ fees		3,486
Custodian fees		3,159
Other expenses	+	2,882
Total expenses		563,904
Expense reduction by CSIM and its affiliates	−	43,633
Net expenses	−	520,271
Net investment income		2,264,817
Realized and Unrealized Gains (Losses)
Realized capital gain distributions received from affiliated underlying funds		916,684
Net realized gains on sales of affiliated underlying funds		949,940
Net realized gains on unaffiliated investments	+	33
Net realized gains		1,866,657
Net change in unrealized appreciation (depreciation) on affiliated underlying funds	+	2,453,969
Net realized and unrealized gains		4,320,626
Increase in net assets resulting from operations		$6,585,443

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

11/1/13-4/30/14				11/1/12-10/31/13
Net investment income		$2,264,817			$3,503,224
Net realized gains		1,866,657			5,583,546
Net change in unrealized appreciation (depreciation)	+	2,453,969			9,133,787
Increase in net assets from operations		6,585,443			18,220,557
Distributions to Shareholders
Distributions from net investment income		($2,406,860	)		($3,392,046	)

Transactions in Fund Shares

		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		VALUE			SHARES		VALUE
Shares sold			1,689,054		$26,087,630			2,448,680		$35,840,677
Shares reinvested			144,370		2,220,799			218,345		3,136,243
Shares redeemed	+		(984,736	)	(15,207,400	)		(2,716,814	)	(39,911,545	)
Net transactions in fund shares			848,688		$13,101,029			(49,789	)	($934,625	)
Shares Outstanding and Net Assets
		11/1/13-4/30/14					11/1/12-10/31/13
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			13,205,371		$202,575,419			13,255,160		$188,681,533
Total increase or decrease	+		848,688		17,279,612			(49,789	)	13,893,886
End of period			14,054,059		$219,855,031			13,205,371		$202,575,419
Net investment income not yet distributed					$115,105					$257,148

30 See financial notes

 Schwab MarketTrack Portfolios

Financial Notes, unaudited

1. Business Structure of the Funds:

Each of the funds 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 and cash equivalents to achieve their investment objectives. 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 a 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 U.S. Securities and 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 NAVs.

•  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

31

 Schwab MarketTrack Portfolios

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, 2014 are disclosed in the Portfolio Holdings.

32 

 Schwab MarketTrack Portfolios

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 and 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. 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.

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.

33

 Schwab MarketTrack Portfolios

Financial Notes, unaudited (continued)

3. Risk Factors (continued):

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 performance also will lag those investments.

•  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 performance also will lag those investments.

•  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.

•  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); the imposition of economic sanctions or other government restrictions; differing accounting, auditing, financial reporting and legal standards and practices; differing securities market structures; and higher transaction costs. These risks may negatively impact the value or liquidity of the underlying fund’s investments, and could impair the underlying fund’s ability to meet its investment objective or invest in accordance with its investment strategy. To the extent an underlying fund’s investment in a single country or a limited number of countries represents a large percentage of the underlying fund’s assets, the underlying fund’s performance may be adversely affected by the economic, political and social conditions in those countries and it may be subject to increased price volatility.

•  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.

34 

 Schwab MarketTrack Portfolios

Financial Notes, unaudited (continued)

3. Risk Factors (continued):

•  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 Risk. When a fund invests in an exchange-traded fund, 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 the funds, CSIM is entitled to receive an annual fee of 0.23% payable monthly based on a percentage of 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, 2014, each Schwab MarketTrack Portfolio’s ownership percentages of other related funds’ shares are:

	Schwab		Schwab		Schwab		Schwab
	MarketTrack		MarketTrack		MarketTrack		MarketTrack
	All Equity		Growth		Balanced		Conservative
Underlying Funds	Portfolio		Portfolio		Portfolio		Portfolio
Schwab International Index Fund		7.3%		5.8%		3.2%		0.9%
Schwab S&P 500 Index Fund		1.5%		1.5%		0.8%		0.2%
Schwab Small-Cap Index Fund		6.1%		5.7%		3.1%		0.9%
Schwab Total Bond Market Fund		—%		10.9%		18.7%		12.3%
Schwab Value Advantage Money Fund		—%		0.1%		0.1%		0.0%	*

* Less than 0.1%

Below is a summary of the funds’ transactions with their affiliated underlying funds during the period ended April 30, 2014.

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		11/01/13		11/01/13
Underlying Funds	10/31/13		Purchases		Sales			04/30/14		04/30/14		to 04/30/14		to 04/30/14
Schwab International Index Fund		8,802,979		566,634		(331,188	)		9,038,425		$183,660,798		$328,974		$4,521,379
Schwab S&P 500 Index Fund		9,440,636		240,630		(360,971	)		9,320,295		275,601,111		1,428,468		4,525,415
Schwab Small-Cap Index Fund		5,275,836		634,941		(159,591	)		5,751,186		154,246,815		396,244		8,321,089
Total											$613,508,724		$2,153,686		$17,367,883

												��
Schwab MarketTrack Growth Portfolio:
	Balance							Balance				Realized			Distributions
	of Shares							of Shares		Market		Gains (Losses)			Received*
	Held at		Gross		Gross			Held at		Value at		11/01/13			11/01/13
Underlying Funds	10/31/13		Purchases		Sales			04/30/14		04/30/14		to 04/30/14			to 04/30/14
Schwab International Index Fund		6,921,005		434,702		(219,843	)		7,135,864		$145,000,753		$314,685			$3,532,814
Schwab S&P 500 Index Fund		9,836,526		315,130		(364,614	)		9,787,042		289,402,839		1,201,041			4,685,244
Schwab Small-Cap Index Fund		4,916,709		589,823		(177,184	)		5,329,348		142,933,119		1,698,696			7,705,703
Schwab Total Bond Market Fund		10,568,831		857,443		(189,959	)		11,236,315		105,958,449		(4,071	)		1,199,260
Schwab Value Advantage Money Fund, Institutional Prime Shares		11,050,198		1,120		—			11,051,318		11,051,318		—			1,017
Total											$694,346,478		$3,210,351			$17,124,038

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		11/01/13		11/01/13
Underlying Funds	10/31/13		Purchases		Sales			04/30/14		04/30/14		to 04/30/14		to 04/30/14
Schwab International Index Fund		3,683,193		435,411		(196,709	)		3,921,895		$79,692,916		$184,829		$1,880,564
Schwab S&P 500 Index Fund		5,225,847		456,197		(307,453	)		5,374,591		158,926,644		1,056,259		2,489,454
Schwab Small-Cap Index Fund		2,607,484		487,406		(186,343	)		2,908,547		78,007,220		977,375		4,088,771
Schwab Total Bond Market Fund		17,782,598		2,231,713		(679,636	)		19,334,675		182,325,988		17,354		2,035,409
Schwab Value Advantage Money Fund, Institutional Prime Shares		8,033,203		814		—			8,034,017		8,034,017		—		739
Total											$506,986,785		$2,235,817		$10,494,937

Schwab MarketTrack Conservative Portfolio:
	Balance							Balance				Realized		Distributions
	of Shares							of Shares		Market		Gains (Losses)		Received*
	Held at		Gross		Gross			Held at		Value at		11/01/13		11/01/13
Underlying Funds	10/31/13		Purchases		Sales			04/30/14		04/30/14		to 04/30/14		to 04/30/14
Schwab International Index Fund		1,040,719		115,619		(53,196	)		1,103,142		$22,415,837		$46,127		$527,631
Schwab S&P 500 Index Fund		1,470,146		136,053		(100,957	)		1,505,242		44,509,993		514,598		695,080
Schwab Small-Cap Index Fund		730,478		128,335		(54,899	)		803,914		21,560,962		386,613		1,134,043
Schwab Total Bond Market Fund		11,804,305		1,133,396		(197,485	)		12,740,216		120,140,241		2,602		1,343,657
Schwab Value Advantage Money Fund, Institutional Prime Shares		3,487,298		354		—			3,487,652		3,487,652		—		321
Total											$212,114,685		$949,940		$3,700,732

* 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 CSIM 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 on the funds’ 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, 2014, 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		$34,567,883		$21,590,000
Schwab MarketTrack Growth Portfolio		40,959,826		21,735,000
Schwab MarketTrack Balanced Portfolio		54,966,188		24,415,000
Schwab MarketTrack Conservative Portfolio		20,116,536		7,365,000

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
	(11/1/13-4/30/14)		(11/1/12-10/31/13)
Schwab MarketTrack All Equity Portfolio		$8,081		$15,578
Schwab MarketTrack Growth Portfolio		8,542		4,885
Schwab MarketTrack Balanced Portfolio		6,613		4,993
Schwab MarketTrack Conservative Portfolio		965		4,449

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, 2013, 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		$5,940,496		$—		$—		$—
October 31, 2017		31,279,738		617,977		—		2,863,437
October 31, 2018		8,349,147		918,434		—		—
Total		$45,569,381		$1,536,411		$—		$2,863,437

Qualified late-year losses are certain capital and ordinary losses which occur during the portion of a fund’s taxable year subsequent to October 31. A fund may elect to treat any portion of qualified late-year losses as arising during the first day of the next taxable year. For the year ended October 31, 2013, the funds had late-year ordinary 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
Late-year ordinary losses deferred		$—		$610,915		$—		$—
Capital losses utilized		6,848,693		11,299,113		8,159,980		5,473,334

As of October 31, 2013, 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, 2013, the funds did not incur any interest or penalties.

38 

 Schwab MarketTrack Portfolios

Financial Notes, unaudited (continued)

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.

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 97 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).	76	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).	76	Director, Gilead Sciences, Inc. (2005 – present) Director, Monaco Coach Corporation (2005 – 2009)
David L. Mahoney 1954 Trustee (Trustee of Schwab Capital Trust since 2011.)	Private Investor.	76	Director, Symantec Corporation (2003 – present) Director, Corcept Therapeutics Incorporated (2004 – present)
Kiran M. Patel 1948 Trustee (Trustee of Schwab Capital Trust since 2011.)	Retired. Executive Vice President and General Manager of Small Business Group, Intuit, Inc. (financial software and services for consumers and small businesses) (Dec. 2008 – Sept. 2013).	76	Director, KLA-Tencor Corporation (2008 – present)
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).	76	Director, Eaton (2012 – present) Director and Chairman of the Audit Committee, Oneok Partners LP (2003 – 2013) Director, Oneok, Inc. (2009 – 2013) Lead Independent Director, Board of Cooper Industries (2002 – 2012)
Joseph H. Wender 1944 Trustee (Trustee of Schwab Capital Trust since 2008.)	Senior Consultant, Goldman Sachs & Co., Inc. (investment banking and securities firm) (Jan. 2008 – present); Partner, Colgin Partners, LLC (vineyards) (February 1998 – present).	76	Board Member and Chairman of the Audit Committee, Isis Pharmaceuticals (1994 – present)

40 

 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.	76	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.	97	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, Chief Executive Officer (Dec. 2010 – present), and Chief Investment Officer (Sept. 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 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 (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).

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
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).
David Lekich 1964 Chief Legal Officer and Secretary (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 and Assistant Secretary (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 retire at age 72 or after twenty years as a trustee, whichever comes first. In addition, the retirement policy requires any independent trustee of 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 own stock of The Charles Schwab Corporation, the parent company of 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

All Equity Composite Index Effective March 1, 2014, the All Equity Composite Index is composed of 45% S&P 500 Index, 25% Russell 2000 Index, 30% MSCI EAFE Index (Net), and 0.5% Barclays U.S. Treasury Bills: 1 − 3 Months. Prior to March 1, 2014, the All Equity Composite Index was composed of 70% Dow Jones U.S. Total Stock Market Index and 30% MSCI EAFE Index (Net).

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.

Balanced Composite Index Effective March 1, 2014, the Balanced Composite Index is composed of 30% S&P 500 Index, 15% Russell 2000 Index, 15% MSCI EAFE Index (Net), 35% Barclays U.S. Aggregate Bond Index, and 5% Barclays U.S. Treasury Bills: 1 − 3 Months. Prior to March 1, 2014, the Balanced Composite Index was composed of 45% Dow Jones U.S. Total Stock Market Index, 15% MSCI EAFE (Net) Index, 35% Barclays U.S. Aggregate Bond Index, and 5% Barclays U.S. Treasury Bills: 1 − 3 Months Index.

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. Treasury Bills 1 − 3 Months Index An index that includes all publicly issued zero-coupon U.S. Treasury Bills that have a remaining maturity of less than 3 months and more than 1 month, are rated investment grade, and have $250 million or more of outstanding face 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 capital gain or loss is considered unrealized appreciation or depreciation.

Conservative Composite Index Effective March 1, 2014, the Conservative Composite Index is composed of 20% S&P 500 Index, 10% Russell 2000 Index, 10% MSCI EAFE Index (Net), 55% Barclays U.S. Aggregate Bond Index, and 5% Barclays U.S. Treasury Bills: 1 − 3 Months. Prior to March 1, 2014, the Conservative Composite Index was composed of 30% Dow Jones U.S. Total Stock Market Index, 10% MSCI EAFE (Net) Index, 55% Barclays U.S. Aggregate Bond Index, and 5% Barclays U.S. Treasury Bills: 1 − 3 Months.

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.

Growth Composite Index Effective March 1, 2014, the Growth Composite Index is composed of 40% S&P 500 Index, 20% Russell 2000 Index, 20% MSCI EAFE Index (Net), 15% Barclays U.S. Aggregate Bond Index, and 5% Barclays U.S. Treasury Bills: 1 − 3 Months. Prior to March 1, 2014, the Growth Composite Index was composed of 60% Dow Jones U.S. Total Stock Market Index, 20% MSCI EAFE (Net) Index, 15% Barclays U.S. Aggregate Bond Index, and 5% Barclays U.S. Treasury Bills: 1 − 3 Months.

market cap, market capitalization The value of a company as determined by the total value of all shares of its stock outstanding.

MSCI EAFE (Europe, Australasia, Far East) 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. It includes approximately 2000 of the smallest securities based on a combination of their market cap and current index membership.

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.

43

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.

44 

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 the Schwab Funds’ 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.

^© 2014 Charles Schwab & Co., Inc. All rights reserved.

Member SIPC^®

Printed on recycled paper.

MFR13559-17

00118056

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 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, 2014 (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	.1%	Common Stock		10,549,726,052		18,226,492,414
	2	.7%	Short-Term Investments		501,698,441		501,698,441
	99	.8%	Total Investments		11,051,424,493		18,728,190,855
	0	.1%	Collateral Invested for Securities on Loan		14,846,312		14,846,312
	0	.1%	Other Assets and Liabilities, Net				29,598,683
	100	.0%	Net Assets				18,772,635,850

	Number		Value
Security	of Shares		($)
Common Stock 97.1% of net assets
Automobiles & Components 1.1%
BorgWarner, Inc.		241,400		15,000,596
Delphi Automotive plc		313,200		20,934,288
Ford Motor Co.		4,277,397		69,079,962
General Motors Co.		1,395,000		48,099,600
Harley-Davidson, Inc.		231,470		17,114,892
Johnson Controls, Inc.		733,559		33,112,853
The Goodyear Tire & Rubber Co.		247,536		6,237,907
				209,580,098
Banks 5.9%
Bank of America Corp.		11,448,611		173,331,970
BB&T Corp.		763,726		28,509,892
Citigroup, Inc.		3,293,247		157,779,464
Comerica, Inc.		188,270		9,082,145
Fifth Third Bancorp		991,829		20,441,596
Hudson City Bancorp, Inc.		481,992		4,800,640
Huntington Bancshares, Inc.		989,593		9,064,672
JPMorgan Chase & Co.		4,107,131		229,917,193
KeyCorp		941,198		12,837,941
M&T Bank Corp.		138,598		16,910,342
People’s United Financial, Inc.		343,300		4,902,324
Regions Financial Corp.		1,567,445		15,893,892
SunTrust Banks, Inc.		602,116		23,036,958
The PNC Financial Services Group, Inc.		571,278		48,010,203
U.S. Bancorp		1,976,728		80,610,968
Wells Fargo & Co.		5,193,209		257,790,895
Zions Bancorp		178,698		5,167,946
				1,098,089,041
Capital Goods 7.9%
3M Co.		691,919		96,239,014
Allegion plc		96,933		4,783,644
AMETEK, Inc.		260,300		13,723,016
Caterpillar, Inc.		693,162		73,059,275
Cummins, Inc.		182,562		27,539,478
Danaher Corp.		651,474		47,805,162
Deere & Co.		411,386		38,398,769
Dover Corp.		182,470		15,765,408
Eaton Corp. plc		515,538		37,448,680
Emerson Electric Co.		755,015		51,476,923
Fastenal Co.		283,398		14,192,572
Flowserve Corp.		150,300		10,979,415
Fluor Corp.		191,882		14,525,467
General Dynamics Corp.		363,360		39,769,752
General Electric Co.		10,881,752		292,610,311
Honeywell International, Inc.		850,429		79,004,854
Illinois Tool Works, Inc.		436,936		37,240,055
Ingersoll-Rand plc		290,800		17,389,840
Jacobs Engineering Group, Inc. *		137,934		7,958,792
Joy Global, Inc.		113,200		6,835,016
L-3 Communications Holdings, Inc.		105,783		12,204,185
Lockheed Martin Corp.		289,391		47,500,639
Masco Corp.		382,388		7,682,175
Northrop Grumman Corp.		242,467		29,462,165
PACCAR, Inc.		379,550		24,283,609
Pall Corp.		126,730		10,664,329
Parker Hannifin Corp.		155,336		19,709,032
Pentair Ltd.		208,982		15,525,273
Precision Castparts Corp.		157,527		39,868,508
Quanta Services, Inc. *		231,900		8,181,432
Raytheon Co.		338,488		32,318,834
Rockwell Automation, Inc.		150,521		17,939,093
Rockwell Collins, Inc.		147,405		11,445,998
Roper Industries, Inc.		102,800		14,284,060
Snap-on, Inc.		58,282		6,760,712
Stanley Black & Decker, Inc.		166,181		14,273,286
Textron, Inc.		292,004		11,942,964
The Boeing Co.		739,654		95,430,159
United Technologies Corp.		913,235		108,063,097
W.W. Grainger, Inc.		65,927		16,771,829
Xylem, Inc.		197,600		7,427,784
				1,478,484,606
Commercial & Professional Supplies 0.6%
Cintas Corp.		111,376		6,563,388
Equifax, Inc.		136,561		9,669,884
Iron Mountain, Inc.		220,560		6,272,726
Nielsen Holdings N.V.		303,100		14,230,545
Pitney Bowes, Inc.		196,591		5,268,639
Republic Services, Inc.		289,334		10,152,730
Robert Half International, Inc.		139,442		6,247,002
Stericycle, Inc. *		89,400		10,409,736
The ADT Corp.		227,100		6,867,504

See financial notes 1

 Schwab S&P 500 Index Fund

Portfolio Holdings (Unaudited) continued

		Number		Value
Security		of Shares		($)
The Dun & Bradstreet Corp.			46,500		5,150,340
Tyco International Ltd.			480,900		19,668,810
Waste Management, Inc.			454,916		20,221,016
					120,722,320
Consumer Durables & Apparel 1.3%
Coach, Inc.	��		299,728		13,382,855
D.R. Horton, Inc.			285,216		6,354,612
Fossil Group, Inc. *			54,900		5,855,085
Garmin Ltd. (b)			131,100		7,485,810
Harman International Industries, Inc.			86,656		9,498,364
Hasbro, Inc.			121,717		6,726,081
Leggett & Platt, Inc.			157,894		5,188,397
Lennar Corp., Class A			193,818		7,479,437
Mattel, Inc.			357,094		14,003,441
Michael Kors Holdings Ltd. *			190,000		17,328,000
Mohawk Industries, Inc. *			65,300		8,646,373
Newell Rubbermaid, Inc.			327,150		9,850,487
NIKE, Inc., Class B			817,524		59,638,376
PulteGroup, Inc.			370,186		6,807,721
PVH Corp.			84,100		10,560,437
Ralph Lauren Corp.			62,826		9,509,972
Under Armour, Inc., Class A *			175,000		8,555,750
VF Corp.			377,164		23,040,949
Whirlpool Corp.			83,322		12,779,928
					242,692,075
Consumer Services 1.7%
Carnival Corp.			456,921		17,961,565
Chipotle Mexican Grill, Inc. *			33,959		16,928,562
Darden Restaurants, Inc.			128,248		6,375,208
Graham Holdings Co., Class B			5,369		3,603,834
H&R Block, Inc.			286,205		8,133,946
International Game Technology			280,660		3,522,283
Marriott International, Inc., Class A			254,872		14,764,735
McDonald’s Corp.			1,073,638		108,845,420
Starbucks Corp.			819,862		57,898,654
Starwood Hotels & Resorts Worldwide, Inc.			203,468		15,595,822
Wyndham Worldwide Corp.			148,464		10,591,422
Wynn Resorts Ltd.			87,800		17,901,542
Yum! Brands, Inc.			470,485		36,222,640
					318,345,633
Diversified Financials 4.8%
American Express Co.			983,641		85,999,733
Ameriprise Financial, Inc.			203,314		22,695,942
Berkshire Hathaway, Inc., Class B *			1,952,430		251,570,605
BlackRock, Inc.			134,200		40,394,200
Capital One Financial Corp.			623,774		46,096,899
CME Group, Inc.			337,685		23,769,647
Discover Financial Services			524,873		29,340,401
E*TRADE Financial Corp. *			307,619		6,906,047
Franklin Resources, Inc.			433,605		22,699,222
IntercontinentalExchange Group, Inc.			123,266		25,200,501
Invesco Ltd.			461,447		16,247,549
Legg Mason, Inc.			113,698		5,331,299
Leucadia National Corp.			333,951		8,522,429
McGraw Hill Financial, Inc.			297,567		21,999,128
Moody’s Corp.			211,829		16,628,576
Morgan Stanley			1,521,354		47,055,479
Navient Corp. *			465,000		7,695,750
Northern Trust Corp.			240,518		14,491,209
State Street Corp.			477,026		30,796,799
T. Rowe Price Group, Inc.			277,179		22,764,711
The Bank of New York Mellon Corp.			1,223,673		41,445,804
The Charles Schwab Corp. (a)			1,267,581		33,654,276
The Goldman Sachs Group, Inc.			456,669		72,984,840
The NASDAQ OMX Group, Inc.			119,900		4,424,310
					898,715,356
Energy 10.3%
Anadarko Petroleum Corp.			546,409		54,105,419
Apache Corp.			430,306		37,350,561
Baker Hughes, Inc.			470,563		32,892,354
Cabot Oil & Gas Corp.			434,200		17,055,376
Cameron International Corp. *			256,300		16,649,248
Chesapeake Energy Corp.			577,766		16,610,772
Chevron Corp.			2,070,634		259,905,980
ConocoPhillips			1,329,790		98,816,695
CONSOL Energy, Inc.			240,418		10,701,005
Denbury Resources, Inc.			377,200		6,344,504
Devon Energy Corp.			417,758		29,243,060
Diamond Offshore Drilling, Inc. (b)			65,300		3,566,033
Ensco plc, Class A			238,200		12,017,190
EOG Resources, Inc.			590,212		57,840,776
EQT Corp.			163,700		17,841,663
Exxon Mobil Corp.			4,687,841		480,081,797
FMC Technologies, Inc. *			246,300		13,965,210
Halliburton Co.			915,468		57,738,567
Helmerich & Payne, Inc.			118,300		12,853,295
Hess Corp.			314,040		27,999,806
Kinder Morgan, Inc.			702,744		22,951,619
Marathon Oil Corp.			741,452		26,803,490
Marathon Petroleum Corp.			335,326		31,168,552
Murphy Oil Corp.			184,892		11,727,699
Nabors Industries Ltd.			287,890		7,346,953
National Oilwell Varco, Inc.			464,724		36,494,776
Newfield Exploration Co. *			145,600		4,928,560
Noble Corp., plc			258,800		7,973,628
Noble Energy, Inc.			398,368		28,594,855
Occidental Petroleum Corp.			858,650		82,215,737
ONEOK, Inc.			231,100		14,610,142
Peabody Energy Corp.			261,564		4,972,331
Phillips 66			655,595		54,558,616
Pioneer Natural Resources Co.			152,800		29,531,656
QEP Resources, Inc.			186,091		5,711,133
Range Resources Corp.			178,200		16,118,190
Rowan Cos. plc, Class A *			126,263		3,904,052
Schlumberger Ltd.			1,420,015		144,202,523
Southwestern Energy Co. *			366,500		17,548,020
Spectra Energy Corp.			715,309		28,404,920
Tesoro Corp.			138,207		7,779,672
The Williams Cos., Inc.			751,198		31,678,020

2 See financial notes

 Schwab S&P 500 Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Transocean Ltd.		360,000		15,505,200
Valero Energy Corp.		568,940		32,526,300
				1,930,835,955
Food & Staples Retailing 2.3%
Costco Wholesale Corp.		476,892		55,166,867
CVS Caremark Corp.		1,274,951		92,714,437
Safeway, Inc.		266,496		9,076,854
Sysco Corp.		615,857		22,435,670
The Kroger Co.		576,447		26,539,620
Wal-Mart Stores, Inc.		1,754,702		139,867,296
Walgreen Co.		948,111		64,376,737
Whole Foods Market, Inc.		396,932		19,727,520
				429,905,001
Food, Beverage & Tobacco 5.1%
Altria Group, Inc.		2,186,791		87,712,187
Archer-Daniels-Midland Co.		704,799		30,820,860
Brown-Forman Corp., Class B		168,992		15,161,962
Campbell Soup Co.		188,711		8,584,463
Coca-Cola Enterprises, Inc.		258,662		11,753,601
ConAgra Foods, Inc.		476,949		14,551,714
Constellation Brands, Inc., Class A *		175,065		13,977,190
Dr Pepper Snapple Group, Inc.		203,200		11,261,344
General Mills, Inc.		674,280		35,750,326
Hormel Foods Corp.		144,300		6,881,667
Kellogg Co.		268,934		17,972,859
Keurig Green Mountain, Inc.		140,100		13,124,568
Kraft Foods Group, Inc.		634,718		36,090,066
Lorillard, Inc.		389,091		23,119,787
McCormick & Co., Inc. - Non Voting Shares		132,602		9,441,263
Mead Johnson Nutrition Co.		223,200		19,699,632
Molson Coors Brewing Co., Class B		164,430		9,860,867
Mondelez International, Inc., Class A		1,881,354		67,070,270
Monster Beverage Corp. *		148,900		9,970,344
PepsiCo, Inc.		1,643,463		141,157,037
Philip Morris International, Inc.		1,724,346		147,310,879
Reynolds American, Inc.		327,596		18,486,242
The Coca-Cola Co.		4,109,556		167,628,789
The Hershey Co.		170,528		16,411,615
The JM Smucker Co.		124,275		12,014,907
Tyson Foods, Inc., Class A		304,290		12,771,051
				958,585,490
Health Care Equipment & Services 4.0%
Abbott Laboratories		1,669,286		64,668,140
Aetna, Inc.		401,775		28,706,824
AmerisourceBergen Corp.		247,246		16,115,494
Baxter International, Inc.		589,089		42,879,788
Becton, Dickinson & Co.		202,390		22,876,142
Boston Scientific Corp. *		1,434,274		18,086,195
C.R. Bard, Inc.		84,373		11,586,944
Cardinal Health, Inc.		365,733		25,422,101
CareFusion Corp. *		231,766		9,052,780
Cerner Corp. *		312,600		16,036,380
Cigna Corp.		293,308		23,476,372
Covidien plc		497,200		35,425,500
DaVita HealthCare Partners, Inc. *		203,500		14,102,550
DENTSPLY International, Inc.		149,900		6,690,037
Edwards Lifesciences Corp. *		115,800		9,434,226
Express Scripts Holding Co. *		860,695		57,305,073
Humana, Inc.		175,903		19,305,354
Intuitive Surgical, Inc. *		41,131		14,877,083
Laboratory Corp. of America Holdings *		97,291		9,602,622
McKesson Corp.		249,575		42,225,594
Medtronic, Inc.		1,085,439		63,845,522
Patterson Cos., Inc.		83,947		3,416,643
Quest Diagnostics, Inc.		156,880		8,774,298
St. Jude Medical, Inc.		301,387		19,129,033
Stryker Corp.		314,340		24,439,935
Tenet Healthcare Corp. *		112,904		5,089,712
UnitedHealth Group, Inc.		1,086,310		81,516,703
Varian Medical Systems, Inc. *		110,706		8,806,662
WellPoint, Inc.		313,629		31,576,168
Zimmer Holdings, Inc.		177,223		17,155,186
				751,625,061
Household & Personal Products 2.1%
Avon Products, Inc.		481,920		7,363,738
Colgate-Palmolive Co.		939,194		63,207,756
Kimberly-Clark Corp.		408,795		45,887,239
The Clorox Co.		140,857		12,775,730
The Estee Lauder Cos., Inc., Class A		272,452		19,771,842
The Procter & Gamble Co.		2,940,690		242,753,959
				391,760,264
Insurance 2.8%
ACE Ltd.		362,500		37,091,000
Aflac, Inc.		491,573		30,831,459
American International Group, Inc.		1,587,854		84,362,683
Aon plc		323,350		27,445,948
Assurant, Inc.		89,346		6,022,814
Cincinnati Financial Corp.		155,203		7,564,594
Genworth Financial, Inc., Class A *		496,064		8,854,742
Hartford Financial Services Group, Inc.		473,095		16,969,918
Lincoln National Corp.		294,671		14,294,490
Loews Corp.		324,016		14,246,984
Marsh & McLennan Cos., Inc.		579,479		28,574,109
MetLife, Inc.		1,218,577		63,792,506
Principal Financial Group, Inc.		288,467		13,511,794
Prudential Financial, Inc.		504,531		40,705,561
The Allstate Corp.		501,310		28,549,605
The Chubb Corp.		267,893		24,667,587
The Progressive Corp.		600,020		14,550,485
The Travelers Cos., Inc.		396,860		35,947,578
Torchmark Corp.		95,511		7,612,227
Unum Group		276,440		9,183,337
XL Group plc		312,199		9,787,439
				524,566,860

See financial notes 3

 Schwab S&P 500 Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Materials 3.4%
Air Products & Chemicals, Inc.		223,401		26,254,086
Airgas, Inc.		75,000		7,969,500
Alcoa, Inc.		1,245,564		16,777,747
Allegheny Technologies, Inc.		101,170		4,168,204
Avery Dennison Corp.		103,076		5,015,678
Ball Corp.		152,738		8,582,348
Bemis Co., Inc.		116,535		4,689,368
CF Industries Holdings, Inc.		66,225		16,236,383
E.I. du Pont de Nemours & Co.		1,005,404		67,683,797
Eastman Chemical Co.		172,716		15,055,654
Ecolab, Inc.		286,628		29,992,754
FMC Corp.		136,000		10,472,000
Freeport-McMoRan Copper & Gold, Inc.		1,126,240		38,708,869
International Flavors & Fragrances, Inc.		80,543		7,935,096
International Paper Co.		493,989		23,044,587
LyondellBasell Industries N.V., Class A		477,500		44,168,750
MeadWestvaco Corp.		181,650		7,097,066
Monsanto Co.		562,800		62,301,960
Newmont Mining Corp.		512,646		12,729,000
Nucor Corp.		331,100		17,134,425
Owens-Illinois, Inc. *		157,500		5,005,350
PPG Industries, Inc.		152,248		29,478,258
Praxair, Inc.		313,679		40,950,794
Sealed Air Corp.		236,068		8,099,493
Sigma-Aldrich Corp.		127,254		12,243,107
The Dow Chemical Co.		1,318,635		65,799,887
The Mosaic Co.		363,000		18,164,520
The Sherwin-Williams Co.		97,636		19,511,578
United States Steel Corp. (b)		134,613		3,502,630
Vulcan Materials Co.		151,071		9,748,612
				638,521,501
Media 3.4%
Cablevision Systems Corp., Class A		220,000		3,674,000
CBS Corp., Class B - Non Voting Shares		597,836		34,531,007
Comcast Corp., Class A		2,826,964		146,323,657
DIRECTV *		523,302		40,608,235
Discovery Communications, Inc., Class A *		234,100		17,768,190
Gannett Co., Inc.		237,514		6,453,255
News Corp., Class A *		516,400		8,789,128
Omnicom Group, Inc.		280,047		18,953,581
Scripps Networks Interactive, Inc., Class A		116,593		8,752,637
The Interpublic Group of Cos., Inc.		454,565		7,918,522
The Walt Disney Co.		1,767,183		140,208,299
Time Warner Cable, Inc.		306,801		43,400,070
Time Warner, Inc.		972,574		64,637,268
Twenty-First Century Fox, Inc., Class A		2,122,901		67,975,290
Viacom, Inc., Class B		431,253		36,647,880
				646,641,019
Pharmaceuticals, Biotechnology & Life Sciences 8.8%
AbbVie, Inc.		1,722,886		89,727,903
Actavis plc *		188,946		38,607,336
Agilent Technologies, Inc.		376,466		20,344,223
Alexion Pharmaceuticals, Inc. *		210,000		33,222,000
Allergan, Inc.		323,758		53,692,027
Amgen, Inc.		818,859		91,507,493
Biogen Idec, Inc. *		256,891		73,758,544
Bristol-Myers Squibb Co.		1,783,064		89,313,676
Celgene Corp. *		441,413		64,892,125
Eli Lilly & Co.		1,056,523		62,440,509
Forest Laboratories, Inc. *		270,564		24,867,537
Gilead Sciences, Inc. *		1,668,350		130,948,792
Hospira, Inc. *		178,482		8,174,476
Johnson & Johnson		3,068,125		310,770,381
Merck & Co., Inc.		3,189,314		186,766,228
Mylan, Inc. *		404,751		20,553,256
PerkinElmer, Inc.		141,360		5,932,879
Perrigo Co., plc		141,800		20,541,148
Pfizer, Inc.		6,942,233		217,153,048
Regeneron Pharmaceuticals, Inc. *		83,100		24,671,559
Thermo Fisher Scientific, Inc.		424,337		48,374,418
Vertex Pharmaceuticals, Inc. *		248,100		16,796,370
Waters Corp. *		92,152		9,080,658
Zoetis, Inc.		518,900		15,701,914
				1,657,838,500
Real Estate 2.2%
American Tower Corp.		419,700		35,053,344
Apartment Investment & Management Co., Class A		149,714		4,615,683
AvalonBay Communities, Inc.		138,599		18,925,693
Boston Properties, Inc.		165,976		19,442,429
CBRE Group, Inc., Class A *		307,440		8,190,202
Crown Castle International Corp.		362,300		26,350,079
Equity Residential		373,922		22,225,924
Essex Property Trust, Inc.		67,000		11,608,420
General Growth Properties, Inc.		590,000		13,552,300
HCP, Inc.		476,200		19,933,732
Health Care REIT, Inc.		307,900		19,425,411
Host Hotels & Resorts, Inc.		810,111		17,376,881
Kimco Realty Corp.		421,159		9,652,964
Plum Creek Timber Co., Inc.		203,177		8,858,517
Prologis, Inc.		536,789		21,809,737
Public Storage		158,978		27,902,229
Simon Property Group, Inc.		340,853		59,035,739
The Macerich Co.		166,700		10,820,497
Ventas, Inc.		311,500		20,583,920
Vornado Realty Trust REIT		186,356		19,120,125
Weyerhaeuser Co.		634,040		18,926,094
				413,409,920
Retailing 4.0%
Amazon.com, Inc. *		403,480		122,710,372
AutoNation, Inc. *		68,533		3,631,564
AutoZone, Inc. *		36,498		19,485,917
Bed Bath & Beyond, Inc. *		226,869		14,095,371

4 See financial notes

 Schwab S&P 500 Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Best Buy Co., Inc.		296,557		7,689,723
CarMax, Inc. *		239,200		10,472,176
Dollar General Corp. *		310,400		17,518,976
Dollar Tree, Inc. *		230,600		12,007,342
Expedia, Inc.		114,513		8,129,278
Family Dollar Stores, Inc.		98,830		5,806,262
GameStop Corp., Class A		119,100		4,725,888
Genuine Parts Co.		177,738		15,484,535
Kohl’s Corp.		213,210		11,681,776
L Brands, Inc.		261,235		14,158,937
Lowe’s Cos., Inc.		1,129,788		51,868,567
Macy’s, Inc.		399,926		22,967,750
Netflix, Inc. *		64,900		20,900,396
Nordstrom, Inc.		151,296		9,271,419
O’Reilly Automotive, Inc. *		116,800		17,378,672
PetSmart, Inc.		106,900		7,234,992
Ross Stores, Inc.		227,200		15,467,776
Staples, Inc.		715,869		8,948,362
Target Corp.		682,208		42,126,344
The Gap, Inc.		294,662		11,580,217
The Home Depot, Inc.		1,527,350		121,439,598
The Priceline Group, Inc. *		56,552		65,473,078
The TJX Cos., Inc.		765,406		44,531,321
Tiffany & Co.		125,428		10,973,696
Tractor Supply Co.		150,000		10,086,000
TripAdvisor, Inc. *		129,813		10,481,102
Urban Outfitters, Inc. *		111,100		3,961,271
				742,288,678
Semiconductors & Semiconductor Equipment 2.0%
Altera Corp.		329,046		10,700,576
Analog Devices, Inc.		348,154		17,856,819
Applied Materials, Inc.		1,313,472		25,034,776
Broadcom Corp., Class A		586,218		18,061,377
First Solar, Inc. *		77,300		5,216,977
Intel Corp.		5,392,505		143,925,958
KLA-Tencor Corp.		185,081		11,843,333
Lam Research Corp. *		181,374		10,448,956
Linear Technology Corp.		255,168		11,354,976
LSI Corp.		573,376		6,387,409
Microchip Technology, Inc.		208,823		9,927,445
Micron Technology, Inc. *		1,155,675		30,186,231
NVIDIA Corp.		601,582		11,111,220
Texas Instruments, Inc.		1,171,354		53,238,039
Xilinx, Inc.		287,363		13,560,660
				378,854,752
Software & Services 9.8%
Accenture plc, Class A		685,400		54,982,788
Adobe Systems, Inc. *		497,776		30,707,801
Akamai Technologies, Inc. *		185,841		9,862,582
Alliance Data Systems Corp. *		57,700		13,957,630
Autodesk, Inc. *		251,781		12,090,524
Automatic Data Processing, Inc.		511,573		39,882,231
CA, Inc.		370,925		11,179,680
Citrix Systems, Inc. *		195,708		11,607,441
Cognizant Technology Solutions Corp., Class A *		648,096		31,047,039
Computer Sciences Corp.		162,140		9,595,445
eBay, Inc. *		1,263,769		65,501,147
Electronic Arts, Inc. *		335,792		9,502,914
Facebook, Inc., Class A *		1,852,800		110,760,384
Fidelity National Information Services, Inc.		299,034		15,977,387
Fiserv, Inc. *		280,704		17,061,189
Google, Inc., Class A *		306,158		163,757,791
Google, Inc., Class C *		306,158		161,241,172
International Business Machines Corp.		1,069,690		210,161,994
Intuit, Inc.		316,409		23,967,982
MasterCard, Inc., Class A		1,105,490		81,308,789
Microsoft Corp.		8,192,531		330,978,252
Oracle Corp.		3,758,986		153,667,348
Paychex, Inc.		348,165		14,556,779
Red Hat, Inc. *		194,100		9,442,965
Salesforce.com, Inc. *		608,765		31,442,712
Symantec Corp.		753,650		15,284,022
Teradata Corp. *		161,371		7,335,926
The Western Union Co.		630,625		10,008,019
Total System Services, Inc.		177,100		5,626,467
VeriSign, Inc. *		149,825		7,068,744
Visa, Inc., Class A		549,800		111,394,978
Xerox Corp.		1,284,866		15,534,030
Yahoo! Inc. *		1,030,255		37,037,667
				1,833,531,819
Technology Hardware & Equipment 6.2%
Amphenol Corp., Class A		171,600		16,362,060
Apple, Inc.		967,431		570,871,359
Cisco Systems, Inc.		5,646,928		130,500,506
Corning, Inc.		1,555,187		32,518,960
EMC Corp.		2,214,945		57,145,581
F5 Networks, Inc. *		82,400		8,666,008
FLIR Systems, Inc.		149,700		5,095,788
Harris Corp.		108,800		7,998,976
Hewlett-Packard Co.		2,069,108		68,404,711
Jabil Circuit, Inc.		170,686		2,946,040
Juniper Networks, Inc. *		520,465		12,850,281
Motorola Solutions, Inc.		252,122		16,029,917
NetApp, Inc.		369,974		13,174,774
QUALCOMM, Inc.		1,834,065		144,359,256
SanDisk Corp.		247,324		21,015,120
Seagate Technology plc		349,400		18,371,452
TE Connectivity Ltd.		449,600		26,517,408
Western Digital Corp.		223,300		19,679,429
				1,172,507,626
Telecommunication Services 2.4%
AT&T, Inc.		5,672,236		202,498,825
CenturyLink, Inc.		645,643		22,539,397
Frontier Communications Corp.		1,102,945		6,562,523
Verizon Communications, Inc.		4,491,378		209,882,094
Windstream Holdings, Inc. (b)		594,274		5,390,065
				446,872,904
Transportation 1.9%
C.H. Robinson Worldwide, Inc.		154,095		9,076,196
CSX Corp.		1,087,991		30,703,106
Delta Air Lines, Inc.		916,400		33,751,012

See financial notes 5

 Schwab S&P 500 Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Expeditors International of Washington, Inc.		239,100		9,860,484
FedEx Corp.		311,668		42,464,765
Kansas City Southern		129,400		13,053,872
Norfolk Southern Corp.		335,892		31,751,871
Ryder System, Inc.		60,702		4,988,490
Southwest Airlines Co.		753,336		18,208,131
Union Pacific Corp.		492,175		93,724,885
United Parcel Service, Inc., Class B		769,918		75,836,923
				363,419,735
Utilities 3.1%
AES Corp.		703,349		10,163,393
AGL Resources, Inc.		129,640		7,000,560
Ameren Corp.		257,420		10,634,020
American Electric Power Co., Inc.		522,002		28,088,928
CenterPoint Energy, Inc.		448,566		11,106,494
CMS Energy Corp.		317,784		9,632,033
Consolidated Edison, Inc.		330,165		19,159,475
Dominion Resources, Inc.		621,764		45,102,761
DTE Energy Co.		189,412		14,800,654
Duke Energy Corp.		778,999		58,027,636
Edison International		369,493		20,898,524
Entergy Corp.		186,753		13,539,592
Exelon Corp.		914,293		32,027,684
FirstEnergy Corp.		433,794		14,640,547
Integrys Energy Group, Inc.		86,594		5,306,480
NextEra Energy, Inc.		472,238		47,152,964
NiSource, Inc.		349,362		12,688,828
Northeast Utilities		337,500		15,950,250
NRG Energy, Inc.		378,600		12,387,792
Pepco Holdings, Inc.		250,100		6,692,676
PG&E Corp.		496,406		22,626,185
Pinnacle West Capital Corp.		125,361		7,013,948
PPL Corp.		684,070		22,806,894
Public Service Enterprise Group, Inc.		532,270		21,807,102
SCANA Corp.		157,500		8,454,600
Sempra Energy		251,269		24,777,636
TECO Energy, Inc.		194,819		3,498,949
The Southern Co.		963,025		44,135,436
Wisconsin Energy Corp.		231,900		11,242,512
Xcel Energy, Inc.		543,886		17,333,647
				578,698,200
Total Common Stock
(Cost $10,549,726,052)				18,226,492,414
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 2.7% of net assets
Time Deposits 2.5%
Australia & New Zealand Banking Group Ltd.
0.03%, 05/01/14		15,112,498		15,112,498
Citibank
0.03%, 05/01/14		57,895,135		57,895,135
Wells Fargo
0.03%, 05/01/14		398,692,850		398,692,850
				471,700,483
U.S. Treasury Obligation 0.2%
U.S. Treasury Bill
0.05%, 06/19/14 (c)(d)		30,000,000		29,997,958
Total Short-Term Investments
(Cost $501,698,441)				501,698,441
End of Investments.
	Number		Value
Security	of Shares		($)
Collateral Invested for Securities on Loan 0.1% of net assets
Wells Fargo Advantage Government Money Market Fund, Institutional Class 0.01% (e)		14,846,312		14,846,312
Total Collateral Invested for Securities on Loan
(Cost $14,846,312)				14,846,312
End of Collateral Invested for Securities on Loan.

At 04/30/14, tax basis cost of the fund’s investments was $11,093,131,863 and the unrealized appreciation and depreciation were $8,118,138,549 and ($483,079,557), respectively, with a net unrealized appreciation of $7,635,058,992.

*	Non-income producing security.
(a)	Issuer is affiliated with the fund’s adviser.
(b)	All or a portion of this security is on loan. Securities on loan were valued at $14,879,804.
(c)	All or a portion of this security is held as collateral for open futures contracts.
(d)	The rate shown is the purchase yield.
(e)	The rate shown is the 7-day yield.

REIT — Real Estate Investment Trust

In addition to the above, the fund held the following at 04/30/14:

			Contract		Unrealized
	Number of		Value		Appreciation
	Contracts		($)		($)
Futures Contracts
S&P 500 Index, e-mini, Long, expires 06/20/14		5,500		516,422,500		9,564,070

6 See financial notes

 Schwab Small-Cap Index Fund

Portfolio Holdings as of April 30, 2014 (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%	Common Stock		1,658,448,442		2,422,381,678
	0	.0%	Rights		213,444		213,444
	0	.0%	Warrants		—		—
	3	.3%	Short-Term Investments		81,905,229		81,905,229
	99	.5%	Total Investments		1,740,567,115		2,504,500,351
	4	.9%	Collateral Invested for Securities on Loan		122,988,021		122,988,021
	(4	.4%)	Other Assets and Liabilities, Net				(109,646,051	)
	100	.0%	Net Assets				2,517,842,321

	Number		Value
Security	of Shares		($)
Common Stock 96.2% of net assets
Automobiles & Components 1.1%
American Axle & Manufacturing Holdings, Inc. *		101,100		1,784,415
Cooper Tire & Rubber Co.		95,423		2,399,889
Dana Holding Corp.		236,000		4,996,120
Dorman Products, Inc. *		38,000		2,186,900
Drew Industries, Inc.		34,800		1,751,136
Federal-Mogul Holdings Corp. *		28,400		489,048
Fox Factory Holding Corp. *		14,100		239,559
Fuel Systems Solutions, Inc. *		22,300		233,704
Gentherm, Inc. *		52,600		1,912,010
Modine Manufacturing Co. *		73,100		1,204,688
Remy International, Inc.		20,000		530,400
Shiloh Industries, Inc. *		7,200		142,128
Spartan Motors, Inc.		44,700		237,357
Standard Motor Products, Inc.		28,800		1,094,112
Stoneridge, Inc. *		42,600		455,394
Superior Industries International, Inc.		37,500		792,750
Tenneco, Inc. *		92,000		5,508,040
Tower International, Inc. *		8,800		244,728
Winnebago Industries, Inc. *		44,000		1,051,600
				27,253,978
Banks 8.5%
1st Source Corp.		23,821		702,481
1st United Bancorp, Inc.		43,000		314,760
Access National Corp.		10,100		148,975
American National Bankshares, Inc.		10,700		228,017
Ameris Bancorp *		38,000		808,260
Ames National Corp.		15,500		338,365
Arrow Financial Corp.		14,148		354,125
Astoria Financial Corp.		130,200		1,726,452
Banc of California, Inc.		23,300		292,881
BancFirst Corp.		10,116		588,852
Banco Latinoamericano de Comercio Exterior, S.A., Class E		46,400		1,193,408
BancorpSouth, Inc.		143,100		3,342,816
Bank Mutual Corp.		78,600		473,172
Bank of Marin Bancorp		9,100		413,231
Bank of the Ozarks, Inc.		46,300		2,773,370
BankFinancial Corp.		28,200		277,488
Banner Corp.		29,700		1,174,338
Bar Harbor Bankshares		5,300		199,174
BBCN Bancorp, Inc.		122,300		1,884,643
BBX Capital Corp., Class A *		10,300		192,919
Beneficial Mutual Bancorp, Inc. *		44,503		580,319
Berkshire Hills Bancorp, Inc.		38,700		906,741
BNC Bancorp		26,100		425,430
BofI Holding, Inc. *		17,500		1,410,675
Boston Private Financial Holdings, Inc.		116,000		1,451,160
Bridge Bancorp, Inc.		16,100		391,552
Bridge Capital Holdings *		12,200		273,280
Brookline Bancorp, Inc.		105,522		958,140
Bryn Mawr Bank Corp.		19,300		526,504
C&F Financial Corp.		4,400		137,500
Camden National Corp.		10,300		393,151
Capital Bank Financial Corp., Class A *		35,300		841,905
Capital City Bank Group, Inc.		15,300		212,670
Capitol Federal Financial, Inc.		220,600		2,656,024
Cardinal Financial Corp.		48,200		809,760
Cascade Bancorp *(c)		17,770		84,052
Cathay General Bancorp		121,122		2,858,479
Center Bancorp, Inc.		16,200		299,862
Centerstate Banks, Inc.		40,200		440,994
Central Pacific Financial Corp.		35,300		662,581
Century Bancorp, Inc., Class A		4,700		157,450
Charter Financial Corp.		32,459		357,049
Chemical Financial Corp.		46,303		1,299,725
Chemung Financial Corp. (c)		5,100		145,809
Citizens & Northern Corp.		16,300		305,462
City Holding Co.		24,900		1,070,451
Clifton Bancorp, Inc.		11,161		129,356
CNB Financial Corp.		20,700		341,964
CoBiz Financial, Inc.		49,300		494,972
Columbia Banking System, Inc.		77,500		1,923,550
Community Bank System, Inc.		61,200		2,276,028
Community Trust Bancorp, Inc.		19,800		730,026
CommunityOne Bancorp *		13,700		133,575
ConnectOne Bancorp, Inc. *		2,500		120,000
CU Bancorp *		13,400		243,210
Customers Bancorp, Inc. *		28,500		627,855
CVB Financial Corp.		140,119		2,026,121
Dime Community Bancshares, Inc.		50,600		824,780
Doral Financial Corp. *		8,550		81,738

18 See financial notes

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Eagle Bancorp, Inc. *		34,480		1,151,287
Enterprise Bancorp, Inc.		8,190		149,549
Enterprise Financial Services Corp.		28,000		500,360
ESB Financial Corp.		20,040		252,905
ESSA Bancorp, Inc.		15,200		157,928
Essent Group Ltd. *		32,900		620,165
EverBank Financial Corp.		121,300		2,270,736
F.N.B. Corp.		233,237		2,901,468
Farmers Capital Bank Corp. *		10,700		223,523
Federal Agricultural Mortgage Corp., Class C		15,800		562,164
Fidelity Southern Corp.		20,948		276,723
Financial Institutions, Inc.		18,500		428,275
First BanCorp *		120,200		617,828
First Bancorp		31,600		543,836
First Bancorp, Inc.		12,096		192,689
First Busey Corp.		103,200		567,600
First Commonwealth Financial Corp.		146,256		1,256,339
First Community Bancshares, Inc.		24,600		364,326
First Connecticut Bancorp, Inc.		23,900		378,815
First Defiance Financial Corp.		13,000		351,260
First Federal Bancshares of Arkansas, Inc. *		14,100		125,067
First Financial Bancorp		88,789		1,437,494
First Financial Bankshares, Inc. (c)		48,231		2,848,041
First Financial Corp.		17,700		566,577
First Financial Holdings, Inc.		35,763		2,055,300
First Financial Northwest, Inc.		22,000		224,400
First Interstate Bancsystem, Inc.		24,600		612,294
First Merchants Corp.		50,700		1,075,854
First Midwest Bancorp, Inc.		112,863		1,847,567
First NBC Bank Holding Co. *		5,900		183,490
First Security Group, Inc. *		89,000		169,100
FirstMerit Corp.		246,215		4,774,109
Flagstar Bancorp, Inc. *		28,300		498,080
Flushing Financial Corp.		47,500		912,950
Fox Chase Bancorp, Inc.		19,500		325,260
Franklin Financial Corp. *		15,300		305,388
German American Bancorp, Inc.		16,900		440,076
Glacier Bancorp, Inc.		106,011		2,720,242
Great Southern Bancorp, Inc.		13,600		389,912
Guaranty Bancorp		20,920		263,383
Hampton Roads Bankshares, Inc. *		74,100		123,006
Hancock Holding Co.		126,149		4,255,006
Hanmi Financial Corp.		45,900		976,293
Heartland Financial USA, Inc.		24,500		595,350
Heritage Commerce Corp.		27,900		226,548
Heritage Financial Corp.		21,000		339,360
Heritage Oaks Bancorp *		27,600		204,516
Hingham Institution for Savings		1,800		125,118
Home Bancorp, Inc. *		9,400		190,350
Home BancShares, Inc.		69,080		2,190,527
Home Federal Bancorp, Inc.		22,200		334,110
Home Loan Servicing Solutions Ltd.		106,900		2,367,835
HomeStreet, Inc.		18,500		335,960
HomeTrust Bancshares, Inc. *		29,400		448,938
Horizon Bancorp		12,400		247,876
Hudson Valley Holding Corp.		27,100		497,556
Iberiabank Corp.		44,900		2,824,210
Independent Bank Corp.		36,100		1,340,032
Independent Bank Group, Inc.		5,400		265,734
International Bancshares Corp.		82,800		1,901,088
Intervest Bancshares Corp. *		25,500		193,035
Investors Bancorp, Inc.		75,139		2,008,466
Kearny Financial Corp. *		22,000		320,760
Ladder Capital Corp., Class A *		22,800		407,892
Lakeland Bancorp, Inc.		50,950		531,918
Lakeland Financial Corp.		23,200		849,120
LCNB Corp. (c)		8,600		137,600
Macatawa Bank Corp.		33,800		164,606
MainSource Financial Group, Inc.		27,000		446,310
MB Financial, Inc.		81,224		2,180,052
Mercantile Bank Corp.		11,800		230,218
Merchants Bancshares, Inc.		9,946		289,130
Meridian Interstate Bancorp, Inc. *		11,800		298,186
Meta Financial Group, Inc.		7,800		326,898
Metro Bancorp, Inc. *		18,600		379,812
MGIC Investment Corp. *		482,200		4,146,920
Middleburg Financial Corp.		7,400		128,242
MidSouth Bancorp, Inc.		10,200		170,544
MidWestOne Financial Group, Inc.		9,300		229,059
NASB Financial, Inc. (c)		5,800		138,388
National Bank Holdings Corp., Class A		65,900		1,262,644
National Bankshares, Inc.		9,300		302,994
National Penn Bancshares, Inc.		177,978		1,738,845
NBT Bancorp, Inc.		67,723		1,533,926
NewBridge Bancorp *		36,000		276,840
Northfield Bancorp, Inc.		94,386		1,224,186
Northrim BanCorp, Inc.		8,900		213,511
Northwest Bancshares, Inc.		140,909		1,872,681
OceanFirst Financial Corp.		19,600		317,912
OFG Bancorp		71,400		1,218,084
Old National Bancorp		157,883		2,229,308
OmniAmerican Bancorp, Inc.		15,900		395,274
Oritani Financial Corp.		67,950		1,007,699
Pacific Continental Corp.		24,700		325,546
Pacific Premier Bancorp, Inc. *		22,000		300,300
PacWest Bancorp		139,751		5,501,997
Palmetto Bancshares, Inc. *		7,300		98,623
Park National Corp.		16,853		1,222,180
Park Sterling Corp.		62,100		405,513
Peapack-Gladstone Financial Corp.		12,200		231,922
Penns Woods Bancorp, Inc.		7,100		312,400
PennyMac Financial Services, Inc., Class A *		18,200		288,834
Peoples Bancorp, Inc.		14,100		367,587
Pinnacle Financial Partners, Inc.		51,932		1,795,289
Preferred Bank *		16,100		345,345
PrivateBancorp, Inc.		97,576		2,690,170
Prosperity Bancshares, Inc.		97,100		5,728,900
Provident Financial Holdings, Inc.		13,400		188,538
Provident Financial Services, Inc.		89,751		1,559,872
Radian Group, Inc.		255,500		3,571,890
Renasant Corp.		48,181		1,311,487
Republic Bancorp, Inc., Class A		13,300		319,333

See financial notes 19

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
S&T Bancorp, Inc.		41,981		976,478
Sandy Spring Bancorp, Inc.		39,900		959,595
Seacoast Banking Corp of Florida *		26,520		281,112
Sierra Bancorp		15,900		248,199
Simmons First National Corp., Class A		23,200		838,912
Southside Bancshares, Inc.		27,893		769,296
Southwest Bancorp, Inc.		32,600		544,420
State Bank Financial Corp.		50,800		842,264
Sterling Bancorp		121,067		1,447,961
Stock Yards Bancorp, Inc.		19,900		586,652
Stonegate Mortgage Corp. *(c)		11,800		149,270
Suffolk Bancorp *		16,500		361,845
Sun Bancorp, Inc. *		50,400		191,520
Susquehanna Bancshares, Inc.		285,008		2,952,683
Talmer Bancorp, Inc., Class A *		26,700		358,047
Taylor Capital Group, Inc. *		24,600		523,734
Territorial Bancorp, Inc.		16,000		327,360
Texas Capital Bancshares, Inc. *		66,500		3,736,635
The Bancorp, Inc. *		52,100		824,222
The Bank of Kentucky Financial Corp.		11,000		379,610
The First of Long Island Corp.		13,000		471,510
Tompkins Financial Corp.		20,600		971,084
TowneBank		35,879		553,613
Tree.com, Inc. *		8,300		241,364
Trico Bancshares		26,900		652,325
Tristate Capital Holdings, Inc. *		9,300		121,644
TrustCo Bank Corp.		150,402		994,157
Trustmark Corp.		99,977		2,286,474
UMB Financial Corp.		52,900		3,105,759
Umpqua Holdings Corp.		252,121		4,192,772
Union Bankshares Corp.		65,368		1,672,767
United Bankshares, Inc.		96,248		2,815,254
United Community Banks, Inc. *		64,700		1,044,905
United Community Financial Corp. *		71,100		236,763
United Financial Bancorp, Inc.		39,500		519,820
United Financial Bancorp, Inc.		29,400		518,616
Univest Corp. of Pennsylvania		22,500		443,475
VantageSouth Bancshares, Inc. *(c)		38,600		237,004
ViewPoint Financial Group, Inc.		61,800		1,611,126
Walker & Dunlop, Inc. *		23,500		368,480
Washington Banking Co.		20,500		352,600
Washington Trust Bancorp, Inc.		21,000		718,200
Waterstone Financial, Inc.		22,604		235,308
Webster Financial Corp.		134,400		4,050,816
WesBanco, Inc.		39,298		1,188,372
West Bancorp, Inc.		20,800		301,808
Westamerica Bancorp		41,200		2,093,784
Western Alliance Bancorp *		114,500		2,641,515
Westfield Financial, Inc.		37,600		257,560
Wilshire Bancorp, Inc.		98,300		983,000
Wintrust Financial Corp.		64,255		2,879,909
WSFS Financial Corp.		12,500		845,250
Yadkin Financial Corp. *		20,500		392,575
				213,405,610
Capital Goods 9.0%
AAON, Inc.		40,725		1,154,554
AAR Corp.		60,497		1,566,872
Accuride Corp. *		65,000		366,600
Aceto Corp.		39,400		862,072
Actuant Corp., Class A		109,148		3,695,751
Acuity Brands, Inc.		64,400		8,022,308
Aegion Corp. *		59,900		1,526,851
Aerovironment, Inc. *		26,700		901,659
Aircastle Ltd.		103,000		1,809,710
Alamo Group, Inc.		10,500		557,760
Albany International Corp., Class A		42,100		1,514,758
Altra Industrial Motion Corp.		41,800		1,427,888
Ameresco, Inc., Class A *		27,700		177,557
American Railcar Industries, Inc.		15,000		1,041,600
American Science & Engineering, Inc.		12,200		819,840
American Superconductor Corp. *(c)		59,800		76,544
American Woodmark Corp. *		15,700		471,157
API Technologies Corp. *		44,400		101,232
Apogee Enterprises, Inc.		43,400		1,378,818
Applied Industrial Technologies, Inc.		62,466		2,993,371
Argan, Inc.		19,900		532,723
Astec Industries, Inc.		31,295		1,250,235
Astronics Corp. *		23,160		1,322,899
AZZ, Inc.		38,800		1,684,696
Barnes Group, Inc.		80,440		3,098,549
Beacon Roofing Supply, Inc. *		72,382		2,575,352
Blount International, Inc. *		77,662		867,485
BlueLinx Holdings, Inc. *		138,964		182,043
Briggs & Stratton Corp.		69,593		1,487,202
Builders FirstSource, Inc. *		60,900		478,065
CAI International, Inc. *		24,500		532,875
Capstone Turbine Corp. *(c)		483,600		996,216
Chart Industries, Inc. *		45,700		3,117,654
CIRCOR International, Inc.		26,300		2,135,823
CLARCOR, Inc.		74,600		4,308,896
Columbus McKinnon Corp. *		30,600		810,594
Comfort Systems USA, Inc.		57,000		855,000
Commercial Vehicle Group, Inc. *		33,500		325,285
Continental Building Products, Inc. *		20,200		343,400
Cubic Corp.		30,215		1,433,098
Curtiss-Wright Corp.		70,200		4,488,588
DigitalGlobe, Inc. *		110,735		3,297,688
Douglas Dynamics, Inc.		30,400		512,848
Ducommun, Inc. *		15,100		366,477
DXP Enterprises, Inc. *		14,600		1,652,866
Dycom Industries, Inc. *		50,500		1,585,700
Dynamic Materials Corp.		17,900		361,580
EMCOR Group, Inc.		99,500		4,576,005
Encore Wire Corp.		31,441		1,532,120
Energy Recovery, Inc. *(c)		61,300		313,243
EnerSys, Inc.		71,178		4,810,209
Engility Holdings, Inc. *		24,500		1,069,180
Enphase Energy, Inc. *(c)		32,800		247,640
EnPro Industries, Inc. *		30,800		2,193,268
Erickson, Inc. *(c)		5,400		85,374

20 See financial notes

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
ESCO Technologies, Inc.		41,369		1,382,552
Esterline Technologies Corp. *		47,000		5,123,940
Federal Signal Corp. *		94,400		1,432,992
Franklin Electric Co., Inc.		70,936		2,743,095
FreightCar America, Inc.		16,000		420,160
FuelCell Energy, Inc. *(c)		287,000		651,490
Furmanite Corp. *		59,700		625,656
GenCorp, Inc. *		89,400		1,569,864
Generac Holdings, Inc.		77,300		4,551,424
General Cable Corp.		75,000		1,921,500
Gibraltar Industries, Inc. *		46,000		785,680
Global Brass & Copper Holdings, Inc.		11,500		182,390
Global Power Equipment Group, Inc.		23,600		413,708
GrafTech International Ltd. *		176,400		1,977,444
Graham Corp.		15,200		453,568
Granite Construction, Inc.		58,000		2,168,040
Great Lakes Dredge & Dock Corp. *		85,200		735,276
Griffon Corp.		63,821		679,056
H&E Equipment Services, Inc. *		46,100		1,777,155
Hardinge, Inc.		16,000		213,760
HEICO Corp.		100,206		5,543,396
Houston Wire & Cable Co.		23,800		296,548
Hurco Cos., Inc.		8,600		229,276
Hyster-Yale Materials Handling, Inc.		15,554		1,499,250
Innovative Solutions & Support, Inc. *		17,900		120,467
Insteel Industries, Inc.		29,600		609,168
John Bean Technologies Corp.		44,800		1,298,752
Kadant, Inc.		16,500		573,375
Kaman Corp.		39,349		1,651,478
Kratos Defense & Security Solutions, Inc. *		62,600		451,972
L.B. Foster Co., Class A		14,500		686,575
Layne Christensen Co. *		28,311		493,178
Lindsay Corp. (c)		20,000		1,762,600
LMI Aerospace, Inc. *		12,300		167,772
LSI Industries, Inc.		34,500		262,545
Lydall, Inc. *		23,000		538,430
Manitex International, Inc. *		17,500		288,050
MasTec, Inc. *		87,473		3,462,181
Meritor, Inc. *		145,700		1,729,459
Miller Industries, Inc.		15,800		306,046
Moog, Inc., Class A *		67,300		4,404,785
Mueller Industries, Inc.		84,248		2,438,137
Mueller Water Products, Inc., Class A		238,600		2,176,032
MYR Group, Inc. *		33,000		774,180
National Presto Industries, Inc. (c)		7,100		513,046
NCI Building Systems, Inc. *		34,200		534,888
NN, Inc.		22,500		440,325
Norcraft Cos, Inc. *		10,700		169,916
Nortek, Inc. *		12,800		1,051,648
Northwest Pipe Co. *		15,800		565,166
Omega Flex, Inc.		10,802		217,876
Orbital Sciences Corp. *		90,336		2,655,878
Orion Marine Group, Inc. *		36,200		424,626
Patrick Industries, Inc. *		9,500		380,665
PGT, Inc. *		47,300		470,635
Pike Corp. *		37,000		355,200
Ply Gem Holdings, Inc. *		22,500		286,875
PMFG, Inc. *		27,700		157,059
Polypore International, Inc. *(c)		69,300		2,403,324
Powell Industries, Inc.		13,000		823,160
Power Solutions International, Inc. *		3,000		248,250
PowerSecure International, Inc. *		31,100		691,353
Preformed Line Products Co.		3,300		197,208
Primoris Services Corp.		53,500		1,496,930
Proto Labs, Inc. *		27,000		1,634,580
Quanex Building Products Corp.		55,404		1,043,811
Raven Industries, Inc.		53,000		1,637,700
RBC Bearings, Inc. *		35,500		2,210,230
Revolution Lighting Technologies, Inc. *(c)		42,300		123,093
Rexnord Corp. *		47,500		1,270,150
Rush Enterprises, Inc., Class A *		51,987		1,668,783
Simpson Manufacturing Co., Inc.		60,494		1,983,598
Sparton Corp. *		14,600		396,536
Standex International Corp.		19,600		1,163,652
Sterling Construction Co., Inc. *		22,000		168,960
Stock Building Supply Holdings, Inc. *		11,500		199,065
Sun Hydraulics Corp.		32,750		1,338,820
TAL International Group, Inc. *		50,300		2,121,654
Taser International, Inc. *		76,200		1,230,630
Tecumseh Products Co., Class A *		26,300		158,063
Teledyne Technologies, Inc. *		55,300		5,135,158
Tennant Co.		26,700		1,703,193
Textainer Group Holdings Ltd. (c)		30,400		1,194,720
The ExOne Co. *(c)		10,200		352,308
The Gorman-Rupp Co.		29,031		901,413
The Greenbrier Cos., Inc. *		37,500		1,966,500
The KEYW Holding Corp. *		45,400		583,390
The Middleby Corp. *		28,252		7,133,065
Thermon Group Holdings, Inc. *		38,600		919,452
Titan International, Inc.		82,100		1,437,571
Titan Machinery, Inc. *(c)		23,200		409,248
Trex Co., Inc. *		26,000		2,041,520
TriMas Corp. *		67,000		2,402,620
Tutor Perini Corp. *		58,230		1,723,608
Twin Disc, Inc.		11,300		326,909
Universal Forest Products, Inc.		30,262		1,527,928
USG Corp. *		113,800		3,398,068
Vicor Corp. *		26,200		219,032
Wabash National Corp. *		98,800		1,319,968
Watsco, Inc.		38,600		3,972,326
Watts Water Technologies, Inc., Class A		43,007		2,287,972
Woodward, Inc.		102,600		4,599,558
Xerium Technologies, Inc. *		15,600		210,600
				225,669,660
Commercial & Professional Supplies 3.3%
ABM Industries, Inc.		82,409		2,232,460
Acacia Research Corp. (c)		72,500		1,162,900
ACCO Brands Corp. *		161,700		991,221
Acorn Energy, Inc. *(c)		24,600		57,072

See financial notes 21

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
ARC Document Solutions, Inc. *		64,500		412,800
Barrett Business Services, Inc.		10,200		514,182
Brady Corp., Class A		69,929		1,803,469
Casella Waste Systems, Inc., Class A *		52,000		265,200
CBIZ, Inc. *		52,800		452,496
CDI Corp.		19,400		297,208
Ceco Environmental Corp.		25,552		406,021
Cenveo, Inc. *		73,800		228,042
Compx International, Inc.		6,699		61,631
Courier Corp.		20,500		297,865
CRA International, Inc. *		14,500		315,665
Deluxe Corp.		76,346		4,195,213
EnerNOC, Inc. *		42,000		991,200
Ennis, Inc.		38,200		571,472
Exponent, Inc.		20,100		1,415,442
Franklin Covey Co. *		17,900		362,833
FTI Consulting, Inc. *		60,600		2,078,580
G&K Services, Inc., Class A		29,830		1,579,200
GP Strategies Corp. *		19,900		522,972
Healthcare Services Group, Inc.		102,425		2,980,567
Heidrick & Struggles International, Inc.		24,100		454,285
Heritage-Crystal Clean, Inc. *		16,900		270,400
Herman Miller, Inc.		88,300		2,722,289
HNI Corp.		68,300		2,406,209
Huron Consulting Group, Inc. *		34,800		2,477,760
ICF International, Inc. *		28,200		1,098,954
InnerWorkings, Inc. *		63,200		455,040
Insperity, Inc.		33,210		1,064,713
Interface, Inc.		90,400		1,626,296
Intersections, Inc.		12,300		69,126
Kelly Services, Inc., Class A		38,323		807,082
Kforce, Inc.		39,300		908,616
Kimball International, Inc., Class B		45,500		762,580
Knoll, Inc.		73,803		1,342,477
Korn/Ferry International *		74,261		2,157,282
McGrath RentCorp		36,698		1,158,923
Mistras Group, Inc. *		21,400		485,994
Mobile Mini, Inc.		57,668		2,547,772
MSA Safety, Inc.		43,089		2,272,945
Multi-Color Corp.		18,500		644,725
Navigant Consulting, Inc. *		72,548		1,218,806
NL Industries, Inc.		8,900		89,267
Odyssey Marine Exploration, Inc. *(c)		114,000		249,660
On Assignment, Inc. *		69,100		2,418,500
Pendrell Corp. *		230,900		380,985
Performant Financial Corp. *		31,800		276,978
Quad Graphics, Inc.		37,000		801,050
Resources Connection, Inc.		65,350		889,413
RPX Corp. *		46,200		756,756
Schawk, Inc.		17,700		354,000
SP Plus Corp. *		21,200		517,704
Steelcase, Inc., Class A		127,242		2,096,948
Swisher Hygiene, Inc. *		409,200		164,253
Team, Inc. *		31,600		1,355,324
Tetra Tech, Inc. *		97,100		2,783,857
The Advisory Board Co. *		52,652		3,014,854
The Brink’s Co.		72,300		1,839,312
The Corporate Executive Board Co.		49,400		3,409,588
TRC Cos., Inc. *		23,700		140,541
TrueBlue, Inc. *		61,576		1,647,158
UniFirst Corp.		22,135		2,130,272
United Stationers, Inc.		60,834		2,283,100
US Ecology, Inc.		31,200		1,393,080
Viad Corp.		30,396		700,628
VSE Corp.		5,500		343,585
WageWorks, Inc. *		38,300		1,622,771
West Corp.		30,400		740,240
				83,547,809
Consumer Durables & Apparel 2.8%
American Apparel, Inc. *		82,600		53,393
Arctic Cat, Inc.		18,800		768,732
Bassett Furniture Industries, Inc.		15,500		213,745
Beazer Homes USA, Inc. *		38,540		730,718
Black Diamond, Inc. *		36,700		409,205
Blyth, Inc. (c)		14,000		131,180
Brunswick Corp.		134,200		5,393,498
Callaway Golf Co.		109,169		950,862
Cavco Industries, Inc. *		10,200		795,090
Columbia Sportswear Co.		20,300		1,745,394
Crocs, Inc. *		133,500		2,019,855
CSS Industries, Inc.		13,400		321,198
Culp, Inc.		12,000		216,600
Ethan Allen Interiors, Inc.		38,179		926,986
EveryWare Global, Inc. *(c)		13,900		37,808
Flexsteel Industries, Inc.		6,200		212,784
G-III Apparel Group Ltd. *		25,500		1,830,135
Helen of Troy Ltd. *		46,900		2,940,630
Hooker Furniture Corp.		14,800		204,980
Hovnanian Enterprises, Inc., Class A *(c)		161,300		719,398
Iconix Brand Group, Inc. *		78,000		3,315,000
Installed Building Products, Inc. *		12,800		178,048
iRobot Corp. *(c)		42,000		1,407,000
JAKKS Pacific, Inc.		36,400		318,864
Johnson Outdoors, Inc., Class A		8,500		177,905
Kate Spade & Co. *		189,400		6,585,438
KB Home		125,600		2,073,656
La-Z-Boy, Inc.		79,600		1,928,708
LeapFrog Enterprises, Inc. *		90,800		621,980
LGI Homes, Inc. *		13,100		192,832
Libbey, Inc. *		29,300		781,431
Lifetime Brands, Inc.		12,400		236,840
M.D.C. Holdings, Inc.		59,600		1,644,960
M/I Homes, Inc. *		34,500		768,315
Malibu Boats, Inc., Class A *		12,300		273,798
Marine Products Corp.		13,700		97,270
Meritage Homes Corp. *		58,985		2,275,641
Movado Group, Inc.		27,200		1,068,416
NACCO Industries, Inc., Class A		7,777		416,770
Nautilus, Inc. *		44,200		368,186
Oxford Industries, Inc.		20,600		1,359,806
Perry Ellis International, Inc. *		16,800		253,680
Quiksilver, Inc. *		206,300		1,324,446
R. G. Barry Corp.		17,500		319,900
Skechers U.S.A., Inc., Class A *		56,978		2,335,528
Skullcandy, Inc. *		22,200		170,940

22 See financial notes

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Smith & Wesson Holding Corp. *(c)		80,900		1,241,815
Standard Pacific Corp. *		224,800		1,796,152
Steven Madden Ltd. *		91,050		3,242,291
Sturm, Ruger & Co., Inc. (c)		29,100		1,872,585
The New Home Co., Inc. *		7,600		104,500
The Ryland Group, Inc.		68,400		2,625,876
TRI Pointe Homes, Inc. *(c)		22,600		363,182
Tumi Holdings, Inc. *		73,300		1,496,786
UCP, Inc., Class A *		11,100		157,065
Unifi, Inc. *		21,300		471,582
Universal Electronics, Inc. *		24,700		922,545
Vera Bradley, Inc. *(c)		30,900		874,470
Vince Holding Corp. *		16,700		459,417
WCI Communities, Inc. *		9,700		185,949
William Lyon Homes, Class A *		19,600		511,560
Wolverine World Wide, Inc.		149,872		4,211,403
ZAGG, Inc. *		35,000		152,250
				71,806,977
Consumer Services 3.5%
American Public Education, Inc. *		25,200		871,920
Ascent Capital Group, Inc., Class A *		21,700		1,492,309
Biglari Holdings, Inc. *		2,160		926,683
BJ’s Restaurants, Inc. *		36,300		1,036,365
Bloomin’ Brands, Inc. *		83,900		1,788,748
Bob Evans Farms, Inc.		39,746		1,862,895
Boyd Gaming Corp. *		99,000		1,170,180
Bravo Brio Restaurant Group, Inc. *		28,900		432,633
Bridgepoint Education, Inc. *		29,700		470,745
Bright Horizons Family Solutions, Inc. *		16,900		689,182
Buffalo Wild Wings, Inc. *		27,500		4,018,300
Caesars Entertainment Corp. *(c)		61,400		1,134,058
Capella Education Co.		15,800		922,088
Career Education Corp. *		91,200		658,464
Carriage Services, Inc.		21,800		350,762
Carrols Restaurant Group, Inc. *		31,300		210,023
Churchill Downs, Inc.		21,161		1,858,571
Chuy’s Holdings, Inc. *		23,100		830,445
ClubCorp Holdings, Inc.		30,000		565,200
Corinthian Colleges, Inc. *(c)		104,400		120,060
Cracker Barrel Old Country Store, Inc.		29,353		2,780,903
Del Frisco’s Restaurant Group, Inc. *		15,200		395,352
Denny’s Corp. *		132,500		893,050
Diamond Resorts International, Inc. *		25,400		475,234
DineEquity, Inc.		25,500		1,933,155
Diversified Restaurant Holdings, Inc. *		15,300		76,653
Education Management Corp. *(c)		36,600		145,302
Einstein Noah Restaurant Group, Inc.		8,000		122,880
Fiesta Restaurant Group, Inc. *		32,500		1,189,825
Grand Canyon Education, Inc. *		67,400		2,906,288
Hillenbrand, Inc.		82,100		2,495,840
Houghton Mifflin Harcourt Co. *		30,400		621,072
Ignite Restaurant Group, Inc. *		9,100		128,674
International Speedway Corp., Class A		43,100		1,355,064
Interval Leisure Group, Inc.		61,100		1,574,547
Intrawest Resorts Holdings, Inc. *(c)		26,900		305,046
Isle of Capri Casinos, Inc. *		27,300		185,640
ITT Educational Services, Inc. *(c)		33,300		899,100
Jack in the Box, Inc. *		66,588		3,565,121
Jamba, Inc. *		21,560		238,454
JTH Holding, Inc., Class A *		6,500		176,800
K12, Inc. *		38,600		914,048
Krispy Kreme Doughnuts, Inc. *		99,100		1,738,214
Life Time Fitness, Inc. *		64,977		3,118,896
LifeLock, Inc. *		91,100		1,430,270
Lincoln Educational Services Corp.		30,200		123,216
Luby’s, Inc. *		25,200		136,584
Marriott Vacations Worldwide Corp. *		44,300		2,413,464
Matthews International Corp., Class A		41,984		1,694,054
Monarch Casino & Resort, Inc. *		11,900		190,876
Morgans Hotel Group Co. *		38,000		285,000
Multimedia Games Holding Co., Inc. *		45,200		1,319,840
Nathan’s Famous, Inc. *		3,700		182,336
Noodles & Co. *(c)		8,800		288,552
Orient-Express Hotels Ltd., Class A *		143,700		1,882,470
Papa John’s International, Inc.		48,410		2,123,263
Pinnacle Entertainment, Inc. *		86,685		2,017,160
Popeyes Louisiana Kitchen, Inc. *		35,800		1,363,980
Potbelly Corp. *(c)		12,500		212,500
Red Robin Gourmet Burgers, Inc. *		21,600		1,468,368
Regis Corp.		67,749		890,222
Ruby Tuesday, Inc. *		87,200		672,312
Ruth’s Hospitality Group, Inc.		56,600		712,594
Scientific Games Corp., Class A *		68,100		815,838
Sonic Corp. *		82,829		1,577,064
Sotheby’s		101,000		4,248,060
Speedway Motorsports, Inc.		15,784		287,111
Steiner Leisure Ltd. *		20,909		902,642
Strayer Education, Inc. *		16,400		699,132
Texas Roadhouse, Inc.		94,196		2,330,409
The Cheesecake Factory, Inc.		77,800		3,492,442
The Marcus Corp.		27,300		456,729
Town Sports International Holdings, Inc.		40,700		285,307
Universal Technical Institute, Inc.		37,700		452,777
Vail Resorts, Inc.		53,571		3,708,720
				88,308,081
Diversified Financials 3.5%
Apollo Investment Corp.		336,400		2,687,836
Arlington Asset Investment Corp., Class A		28,400		751,180
BGC Partners, Inc., Class A		198,500		1,423,245
BlackRock Kelso Capital Corp.		108,800		987,904

See financial notes 23

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Calamos Asset Management, Inc., Class A		34,100		415,338
California First National Bancorp		11,100		164,613
Capital Southwest Corp.		19,200		673,920
Capitala Finance Corp. (c)		6,000		110,280
Cash America International, Inc.		41,570		1,810,373
CIFC Corp.		23,300		179,643
Cohen & Steers, Inc. (c)		28,128		1,139,465
Consumer Portfolio Services, Inc. *		24,200		168,916
Cowen Group, Inc., Class A *		139,200		572,112
Credit Acceptance Corp. *		10,800		1,420,416
DFC Global Corp. *		57,500		535,900
Diamond Hill Investment Group, Inc.		4,100		486,752
Encore Capital Group, Inc. *		37,800		1,633,716
Evercore Partners, Inc., Class A		47,100		2,516,553
Ezcorp, Inc., Class A *		77,400		807,282
FBR & Co. *		14,036		362,129
Fidus Investment Corp. (c)		19,600		359,072
Fifth Street Finance Corp.		205,700		1,915,067
Financial Engines, Inc.		73,400		3,247,950
First Cash Financial Services, Inc. *		44,300		2,160,511
Firsthand Technology Value Fund, Inc. *		11,700		228,852
FXCM, Inc., Class A		52,100		806,508
Gain Capital Holdings, Inc.		20,400		206,040
GAMCO Investors, Inc., Class A		9,700		736,521
Garrison Capital, Inc. (c)		8,600		121,260
GFI Group, Inc.		92,868		345,469
Gladstone Capital Corp.		28,200		272,694
Gladstone Investment Corp.		36,400		286,104
Golub Capital BDC, Inc. (c)		53,300		891,176
Green Dot Corp., Class A *		42,600		739,962
Greenhill & Co., Inc.		43,600		2,186,540
GSV Capital Corp. *(c)		26,500		232,670
Hercules Technology Growth Capital, Inc. (c)		93,500		1,279,080
HFF, Inc., Class A		49,800		1,693,200
Horizon Technology Finance Corp. (c)		11,100		145,410
ICG Group, Inc. *		54,400		1,108,672
Imperial Holdings, Inc. *		24,600		164,574
INTL FCStone, Inc. *		20,400		385,968
Investment Technology Group, Inc. *		55,265		1,140,670
Janus Capital Group, Inc.		221,800		2,690,434
JGWPT Holdings, Inc. *		14,200		201,214
JMP Group, Inc.		20,300		140,273
KCAP Financial, Inc. (c)		36,300		289,311
KCG Holdings, Inc., Class A *		111,666		1,111,077
Ladenburg Thalmann Financial Services, Inc. *		142,600		389,298
Main Street Capital Corp. (c)		58,800		1,848,672
Manning & Napier, Inc.		20,900		347,358
Marcus & Millichap, Inc. *		10,000		165,300
MarketAxess Holdings, Inc.		56,160		3,025,901
Marlin Business Services Corp.		11,600		199,172
MCG Capital Corp.		103,200		346,752
Medallion Financial Corp.		30,900		420,240
Medley Capital Corp.		70,300		916,712
MVC Capital, Inc.		32,100		418,584
Nelnet, Inc., Class A		34,400		1,453,744
New Mountain Finance Corp.		72,200		1,033,182
NewStar Financial, Inc. *		36,500		416,830
NGP Capital Resources Co.		29,000		197,490
Nicholas Financial, Inc.		13,000		204,360
Oppenheimer Holdings, Inc., Class A		13,800		351,348
PennantPark Floating Rate Capital Ltd. (c)		21,000		291,900
PennantPark Investment Corp.		101,100		1,081,770
PHH Corp. *		84,763		2,014,816
PICO Holdings, Inc. *		32,300		750,975
Piper Jaffray Cos. *		24,739		1,085,053
Portfolio Recovery Associates, Inc. *		75,329		4,305,052
Prospect Capital Corp.		465,800		5,035,298
Pzena Investment Management, Inc., Class A		13,700		148,919
RCS Capital Corp., Class A (c)		7,000		240,800
Regional Management Corp. *		6,600		101,244
Resource America, Inc., Class A		16,500		140,415
Safeguard Scientifics, Inc. *		34,100		716,441
Silvercrest Asset Management Group, Inc., Class A		10,000		174,000
Solar Capital Ltd.		68,600		1,502,340
Solar Senior Capital Ltd. (c)		16,300		269,765
Springleaf Holdings, Inc. *		35,200		808,896
Stellus Capital Investment Corp. (c)		17,200		231,340
Stifel Financial Corp. *		94,922		4,439,502
SWS Group, Inc. *		39,000		288,990
TCP Capital Corp.		51,500		833,785
The First Marblehead Corp. *		11,240		59,122
THL Credit, Inc.		54,300		729,249
TICC Capital Corp.		74,500		717,435
Triangle Capital Corp. (c)		41,800		1,089,726
Virtus Investment Partners, Inc. *		10,000		1,849,900
Walter Investment Management Corp. *(c)		53,600		1,424,688
Westwood Holdings Group, Inc.		9,500		552,615
WhiteHorse Finance, Inc.		9,500		129,580
WisdomTree Investments, Inc. *		151,300		1,708,177
World Acceptance Corp. *(c)		13,900		1,009,140
				89,399,728
Energy 5.9%
Abraxas Petroleum Corp. *		129,000		704,340
Adams Resources & Energy, Inc.		2,900		208,974
Alon USA Energy, Inc.		33,200		540,828
Alpha Natural Resources, Inc. *(c)		332,200		1,428,460
Amyris, Inc. *(c)		41,500		146,080
Apco Oil & Gas International, Inc. *		12,200		170,556
Approach Resources, Inc. *(c)		49,700		1,031,275
Arch Coal, Inc. (c)		326,100		1,493,538
Athlon Energy, Inc. *		31,200		1,260,792
Basic Energy Services, Inc. *		46,100		1,217,962
Bill Barrett Corp. *		70,800		1,676,544
Bolt Technology Corp.		11,800		199,184

24 See financial notes

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Bonanza Creek Energy, Inc. *		44,600		2,168,452
BPZ Resources, Inc. *		198,200		535,140
Bristow Group, Inc.		53,587		4,115,482
C&J Energy Services, Inc. *		68,600		2,062,116
Cal Dive International, Inc. *(c)		127,800		189,144
Callon Petroleum Co. *		52,400		481,032
CARBO Ceramics, Inc.		29,300		4,099,363
Carrizo Oil & Gas, Inc. *		68,200		3,752,364
CHC Group Ltd. *		53,100		358,425
Clayton Williams Energy, Inc. *		9,900		1,430,352
Clean Energy Fuels Corp. *(c)		97,500		862,875
Cloud Peak Energy, Inc. *		92,300		1,817,387
Comstock Resources, Inc.		71,200		1,979,360
Contango Oil & Gas Co. *		21,920		1,053,037
Dawson Geophysical Co.		10,600		299,556
Delek US Holdings, Inc.		56,300		1,801,037
Diamondback Energy, Inc. *		31,800		2,287,692
Emerald Oil, Inc. *		81,585		576,806
Endeavour International Corp. *(c)		64,600		222,224
Energy XXI (Bermuda) Ltd. (c)		114,300		2,735,199
EPL Oil & Gas, Inc. *		47,100		1,843,494
Equal Energy Ltd.		50,800		230,124
Era Group, Inc. *		28,700		819,385
Evolution Petroleum Corp.		21,500		253,700
EXCO Resources, Inc. (c)		266,174		1,690,205
Exterran Holdings, Inc.		85,700		3,686,814
Forest Oil Corp. *		177,000		329,220
Forum Energy Technologies, Inc. *		59,800		1,785,628
Frontline Ltd. *		69,000		234,600
FX Energy, Inc. *		75,100		424,315
GasLog Ltd.		47,700		1,277,406
Gastar Exploration, Inc. *		77,800		515,814
Geospace Technologies Corp. *		19,800		1,150,974
Goodrich Petroleum Corp. *(c)		45,100		1,134,265
Green Plains Renewable Energy, Inc.		38,800		1,160,120
Gulf Island Fabrication, Inc.		21,000		421,260
Gulfmark Offshore, Inc., Class A		39,300		1,768,893
Halcon Resources Corp. *(c)		363,221		2,004,980
Hallador Energy Co.		15,600		142,896
Helix Energy Solutions Group, Inc. *		158,200		3,803,128
Hercules Offshore, Inc. *		231,200		1,033,464
Hornbeck Offshore Services, Inc. *		54,245		2,247,370
ION Geophysical Corp. *		210,500		926,200
Isramco, Inc. *(c)		1,400		182,000
Jones Energy, Inc., Class A *		15,900		245,973
Key Energy Services, Inc. *		229,200		2,301,168
KiOR, Inc., Class A *(c)		62,600		38,192
Knightsbridge Tankers Ltd.		43,900		524,605
Kodiak Oil & Gas Corp. *		393,800		5,005,198
Magnum Hunter Resources Corp. *		259,500		2,205,750
Matador Resources Co. *		88,100		2,530,232
Matrix Service Co. *		40,900		1,266,673
Midstates Petroleum Co., Inc. *(c)		47,300		279,070
Miller Energy Resources, Inc. *(c)		41,600		200,512
Mitcham Industries, Inc. *		18,500		255,300
Natural Gas Services Group, Inc. *		20,500		629,145
Newpark Resources, Inc. *		126,710		1,525,588
Nordic American Tankers Ltd. (c)		133,500		1,152,105
North Atlantic Drilling Ltd. (c)		106,800		916,344
Northern Oil & Gas, Inc. *		97,800		1,509,054
Nuverra Environmental Solutions, Inc. *(c)		19,620		333,736
Panhandle Oil & Gas, Inc., Class A		9,400		412,190
Parker Drilling Co. *		181,265		1,201,787
PDC Energy, Inc. *		52,903		3,368,334
Penn Virginia Corp. *		84,778		1,410,706
PetroQuest Energy, Inc. *		84,900		511,098
PHI, Inc. - Non Voting Shares *		17,500		784,000
Pioneer Energy Services Corp. *		99,200		1,485,024
Quicksilver Resources, Inc. *(c)		205,600		670,256
Renewable Energy Group, Inc. *		30,200		355,454
Rentech, Inc. *		316,700		671,404
Resolute Energy Corp. *		96,500		723,750
REX American Resources Corp. *		8,200		535,952
Rex Energy Corp. *		65,900		1,387,854
RigNet, Inc. *		16,900		790,244
Rosetta Resources, Inc. *		91,000		4,307,940
RSP Permian, Inc. *		34,400		975,240
Sanchez Energy Corp. *		58,400		1,651,552
Scorpio Tankers, Inc.		273,600		2,465,136
SEACOR Holdings, Inc. *		30,700		2,560,073
SemGroup Corp., Class A		63,500		4,056,380
Ship Finance International Ltd.		85,700		1,510,891
Solazyme, Inc. *(c)		78,600		845,736
Stone Energy Corp. *		74,968		3,677,181
Swift Energy Co. *(c)		60,701		748,443
Synergy Resources Corp. *		72,400		842,736
T.G.C. Industries, Inc. *		21,000		106,260
Targa Resources Corp.		48,900		5,280,711
Teekay Tankers Ltd., Class A (c)		86,500		301,885
Tesco Corp. *		47,700		954,000
TETRA Technologies, Inc. *		118,074		1,475,925
Triangle Petroleum Corp. *		97,000		933,140
Ur-Energy, Inc. *(c)		173,000		207,600
Uranium Energy Corp. *(c)		136,000		145,520
VAALCO Energy, Inc. *		90,600		835,332
Vantage Drilling Co. *(c)		316,300		528,221
W&T Offshore, Inc.		49,000		940,800
Warren Resources, Inc. *		116,000		588,120
Western Refining, Inc. (c)		80,222		3,489,657
Westmoreland Coal Co. *		21,500		636,615
Willbros Group, Inc. *		57,300		636,603
ZaZa Energy Corp. *		92,600		45,791
				147,946,017
Food & Staples Retailing 1.2%
Casey’s General Stores, Inc.		57,400		3,941,084
Fairway Group Holdings Corp. *(c)		22,400		155,232
Ingles Markets, Inc., Class A		16,831		386,945
Natural Grocers by Vitamin Cottage, Inc. *		12,600		448,560
PriceSmart, Inc.		27,900		2,679,516

See financial notes 25

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Rite Aid Corp. *		1,101,900		8,043,870
Roundy’s, Inc.		35,900		243,043
Spartan Stores, Inc.		52,740		1,136,020
SUPERVALU, Inc. *		307,300		2,148,027
Susser Holdings Corp. *		27,400		2,120,212
The Andersons, Inc.		43,050		2,681,584
The Chefs’ Warehouse, Inc. *		23,600		474,124
The Pantry, Inc. *		34,000		511,360
United Natural Foods, Inc. *		72,982		5,037,947
Village Super Market, Inc., Class A		11,600		280,604
Weis Markets, Inc.		15,800		728,222
				31,016,350
Food, Beverage & Tobacco 2.0%
Alico, Inc.		4,700		164,124
Alliance One International, Inc. *		116,600		299,662
Annie’s, Inc. *		19,500		633,945
B&G Foods, Inc.		78,200		2,564,960
Boulder Brands, Inc. *		91,800		1,354,968
Cal-Maine Foods, Inc.		22,100		1,317,823
Calavo Growers, Inc.		17,900		556,511
Chiquita Brands International, Inc. *		71,002		815,103
Coca-Cola Bottling Co. Consolidated		6,800		559,164
Craft Brew Alliance, Inc. *		13,900		208,083
Darling International, Inc. *		234,700		4,696,347
Diamond Foods, Inc. *		31,900		975,183
Farmer Bros. Co. *		9,100		179,361
Fresh Del Monte Produce, Inc.		57,800		1,669,842
Griffin Land & Nurseries, Inc.		3,800		110,960
Inventure Foods, Inc. *		17,900		215,158
J&J Snack Foods Corp.		22,800		2,134,080
John B. Sanfilippo & Son, Inc.		10,900		251,245
Lancaster Colony Corp.		28,700		2,723,056
Lifeway Foods, Inc.		10,100		151,601
Limoneira Co.		13,800		316,986
National Beverage Corp. *		15,001		289,219
Omega Protein Corp. *		25,900		294,224
Pilgrim’s Pride Corp. *		92,949		2,031,865
Post Holdings, Inc. *		57,500		3,004,950
Sanderson Farms, Inc.		34,500		2,838,315
Seaboard Corp. *		420		1,023,960
Seneca Foods Corp., Class A *		12,400		352,160
Snyder’s-Lance, Inc.		72,200		1,917,632
The Boston Beer Co., Inc., Class A *		12,360		3,041,054
The Hain Celestial Group, Inc. *		57,331		4,931,613
Tootsie Roll Industries, Inc.		32,174		906,985
TreeHouse Foods, Inc. *		55,100		4,123,684
Universal Corp.		35,145		1,917,863
Vector Group Ltd. (c)		96,161		2,048,229
				50,619,915
Health Care Equipment & Services 6.5%
Abaxis, Inc. *		32,200		1,307,642
ABIOMED, Inc. *		59,500		1,409,555
Acadia Healthcare Co., Inc. *		53,200		2,235,464
Accuray, Inc. *(c)		115,500		970,200
Addus HomeCare Corp. *		7,800		168,636
Air Methods Corp. *		57,100		3,178,757
Align Technology, Inc. *		108,700		5,477,393
Alliance HealthCare Services, Inc. *		7,100		202,066
Almost Family, Inc. *		11,000		236,170
Alphatec Holdings, Inc. *		72,200		97,470
Amedisys, Inc. *		49,200		670,596
AMN Healthcare Services, Inc. *		65,600		818,688
Amsurg Corp. *		48,600		2,104,866
Analogic Corp.		17,954		1,347,986
AngioDynamics, Inc. *		33,500		450,240
Anika Therapeutics, Inc. *		19,700		841,978
Antares Pharma, Inc. *(c)		160,700		446,746
ArthroCare Corp. *		42,600		2,067,378
athenahealth, Inc. *		54,500		6,738,380
AtriCure, Inc. *		36,100		555,940
Atrion Corp.		2,300		663,159
Bio-Reference Laboratories, Inc. *(c)		38,800		985,520
Biolase, Inc. *(c)		45,880		88,548
BioScrip, Inc. *		83,100		575,052
Cantel Medical Corp.		47,925		1,589,193
Capital Senior Living Corp. *		44,800		1,107,904
Cardiovascular Systems, Inc. *		39,000		1,121,250
Centene Corp. *		81,592		5,417,709
Cerus Corp. *(c)		109,800		475,434
Chemed Corp.		27,200		2,264,944
Chindex International, Inc. *		20,400		486,132
Computer Programs & Systems, Inc.		17,500		1,104,775
CONMED Corp.		42,200		1,955,126
CorVel Corp. *		16,600		755,964
Cross Country Healthcare, Inc. *		37,200		263,748
CryoLife, Inc.		37,400		339,592
Cutera, Inc. *		20,900		215,479
Cyberonics, Inc. *		41,000		2,425,560
Cynosure, Inc., Class A *		30,244		742,188
Derma Sciences, Inc. *		28,500		294,690
DexCom, Inc. *		106,500		3,454,860
Emeritus Corp. *		63,100		1,882,273
Endologix, Inc. *		95,600		1,212,208
Exactech, Inc. *		15,000		333,300
ExamWorks Group, Inc. *		49,100		1,806,880
Five Star Quality Care, Inc. *		56,200		271,446
GenMark Diagnostics, Inc. *		51,100		457,345
Gentiva Health Services, Inc. *		50,896		383,247
Globus Medical, Inc., Class A *		83,000		2,026,860
Greatbatch, Inc. *		34,900		1,606,447
Haemonetics Corp. *		77,200		2,343,792
Hanger, Inc. *		52,800		1,830,576
HealthSouth Corp.		129,800		4,496,272
HealthStream, Inc. *		30,800		697,620
Healthways, Inc. *		48,800		878,400
HeartWare International, Inc. *		25,400		2,157,984
HMS Holdings Corp. *		130,200		2,105,334
ICU Medical, Inc. *		18,800		1,048,664
Inogen, Inc. *		7,600		107,236
Insulet Corp. *		78,900		2,969,007
Integra LifeSciences Holdings Corp. *		33,248		1,515,444
Invacare Corp.		49,211		777,534

26 See financial notes

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
IPC The Hospitalist Co., Inc. *		24,700		1,000,350
Kindred Healthcare, Inc.		80,275		2,014,903
Landauer, Inc.		13,300		575,092
LDR Holding Corp. *		8,300		206,836
LHC Group, Inc. *		21,100		438,458
Magellan Health Services, Inc. *		41,600		2,401,152
Masimo Corp. *		73,500		1,966,860
MedAssets, Inc. *		92,400		2,109,492
Medical Action Industries, Inc. *		20,700		132,687
Medidata Solutions, Inc. *		79,600		2,890,276
Merge Healthcare, Inc. *		80,500		183,540
Meridian Bioscience, Inc.		64,350		1,285,070
Merit Medical Systems, Inc. *		67,100		863,577
Molina Healthcare, Inc. *		43,700		1,634,380
MWI Veterinary Supply, Inc. *		19,300		3,023,152
National Healthcare Corp.		15,388		842,185
National Research Corp., Class A *		12,500		197,000
Natus Medical, Inc. *		46,900		1,164,527
Neogen Corp. *		54,025		2,256,894
NuVasive, Inc. *		70,100		2,363,071
NxStage Medical, Inc. *		85,200		974,688
Omnicell, Inc. *		52,300		1,384,904
OraSure Technologies, Inc. *		87,400		572,470
Orthofix International N.V. *		28,200		851,640
Owens & Minor, Inc.		94,700		3,176,238
Oxford Immunotec Global PLC *(c)		8,900		159,310
PharMerica Corp. *		43,100		1,171,889
PhotoMedex, Inc. *(c)		18,000		271,980
Quality Systems, Inc.		59,200		874,384
Quidel Corp. *		40,300		864,435
Rockwell Medical, Inc. *(c)		56,300		572,008
RTI Surgical, Inc. *		73,900		317,770
Select Medical Holdings Corp.		69,400		968,824
Skilled Healthcare Group, Inc., Class A *		25,900		133,644
Spectranetics Corp. *		58,400		1,241,584
Staar Surgical Co. *		52,900		899,829
STERIS Corp.		88,500		4,252,425
Surgical Care Affiliates, Inc. *		16,300		478,894
SurModics, Inc. *		20,400		443,904
Symmetry Medical, Inc. *		53,900		445,214
Tandem Diabetes Care, Inc. *		13,300		233,681
Team Health Holdings, Inc. *		102,300		4,959,504
TearLab Corp. *(c)		44,600		192,672
The Ensign Group, Inc.		30,000		1,275,000
The Providence Service Corp. *		17,400		706,614
Thoratec Corp. *		84,900		2,783,022
Tornier N.V. *		37,100		629,587
Triple-S Management Corp., Class B *		33,800		506,324
U.S. Physical Therapy, Inc.		19,300		595,405
Unilife Corp. *(c)		144,000		468,000
Universal American Corp.		51,602		369,986
USMD Holdings, Inc. *(c)		6,300		79,380
Utah Medical Products, Inc.		4,500		228,555
Vascular Solutions, Inc. *		22,700		497,357
Veracyte, Inc. *		8,500		108,885
Vocera Communications, Inc. *		30,100		459,025
Volcano Corp. *		82,600		1,450,456
WellCare Health Plans, Inc. *		64,600		4,358,562
West Pharmaceutical Services, Inc.		103,130		4,473,779
Wright Medical Group, Inc. *		61,500		1,682,025
Zeltiq Aesthetics, Inc. *		28,800		526,752
				162,750,954
Household & Personal Products 0.4%
Central Garden & Pet Co., Class A *		66,600		550,782
Elizabeth Arden, Inc. *		36,298		1,333,589
Harbinger Group, Inc. *		56,600		659,956
Inter Parfums, Inc.		25,400		929,386
Lifevantage Corp. *(c)		161,800		223,284
Medifast, Inc. *		20,200		639,330
Nature’s Sunshine Products, Inc.		15,000		200,400
Nutraceutical International Corp. *		12,300		306,516
Oil-Dri Corp. of America		6,887		230,783
Orchids Paper Products Co.		7,900		212,273
Revlon, Inc., Class A *		18,602		560,664
Spectrum Brands Holdings, Inc.		32,646		2,508,192
Star Scientific, Inc. *(c)		237,700		155,908
Synutra International, Inc. *		23,200		129,456
The Female Health Co. (c)		31,000		234,360
USANA Health Sciences, Inc. *		9,100		617,526
WD-40 Co.		22,300		1,624,332
				11,116,737
Insurance 2.3%
Ambac Financial Group, Inc. *		68,500		2,067,330
American Equity Investment Life Holding Co.		101,364		2,363,808
AMERISAFE, Inc.		26,300		1,121,695
AmTrust Financial Services, Inc. (c)		46,677		1,805,000
Argo Group International Holdings Ltd.		40,191		1,785,284
Baldwin & Lyons, Inc., Class B		13,000		338,130
Blue Capital Reinsurance Holdings Ltd. (c)		9,100		168,896
Citizens, Inc. *		62,600		411,282
CNO Financial Group, Inc.		334,600		5,771,850
Crawford & Co., Class B		34,500		393,990
Donegal Group, Inc., Class A		10,400		153,504
eHealth, Inc. *		28,600		1,198,054
EMC Insurance Group, Inc.		6,200		204,538
Employers Holdings, Inc.		44,900		913,715
Enstar Group Ltd. *		14,094		1,819,535
FBL Financial Group, Inc., Class A		13,868		620,038
Fidelity & Guaranty Life		14,800		317,312
First American Financial Corp.		160,900		4,279,940
Fortegra Financial Corp. *		8,200		59,204
Global Indemnity plc *		15,655		419,554
Greenlight Capital Re Ltd., Class A *		42,789		1,361,974
Hallmark Financial Services, Inc. *		21,200		178,080
HCI Group, Inc.		13,800		533,784

See financial notes 27

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Health Insurance Innovations, Inc., Class A *		6,300		63,567
Hilltop Holdings, Inc. *		99,639		2,225,935
Horace Mann Educators Corp.		59,578		1,791,510
Independence Holding Co.		11,248		146,899
Infinity Property & Casualty Corp.		16,592		1,064,709
Investors Title Co.		1,700		120,292
Kansas City Life Insurance Co.		5,700		237,006
Maiden Holdings Ltd.		76,900		907,420
Meadowbrook Insurance Group, Inc.		71,400		399,840
Montpelier Re Holdings Ltd.		66,000		2,018,280
National Interstate Corp.		8,594		240,804
National Western Life Insurance Co., Class A		2,994		698,351
OneBeacon Insurance Group Ltd., Class A		33,400		515,696
Platinum Underwriters Holdings Ltd.		44,200		2,771,782
Primerica, Inc.		85,500		3,923,595
RLI Corp.		64,420		2,773,925
Safety Insurance Group, Inc.		19,770		1,061,847
Selective Insurance Group, Inc.		84,514		1,938,751
State Auto Financial Corp.		19,600		401,016
Stewart Information Services Corp.		30,400		927,200
Symetra Financial Corp.		122,600		2,532,916
The Navigators Group, Inc. *		14,970		852,841
The Phoenix Cos., Inc. *		7,790		342,916
Third Point Reinsurance Ltd. *		36,200		566,168
Tower Group International Ltd.		81,830		201,302
United Fire Group, Inc.		32,300		898,586
Universal Insurance Holdings, Inc.		41,800		611,534
				58,521,185
Materials 4.7%
A. Schulman, Inc.		44,309		1,591,579
A.M. Castle & Co. *		29,100		357,348
Advanced Emissions Solutions, Inc. *		32,600		747,518
AEP Industries, Inc. *		5,800		206,596
AK Steel Holding Corp. *(c)		208,200		1,457,400
Allied Nevada Gold Corp. *(c)		148,100		502,059
AMCOL International Corp.		42,952		1,969,349
American Vanguard Corp.		40,900		728,429
Ampco-Pittsburgh Corp.		11,400		228,342
Arabian American Development Co. *		27,400		299,482
Axiall Corp.		104,700		4,879,020
Balchem Corp.		43,400		2,688,630
Berry Plastics Group, Inc. *		84,200		1,893,658
Boise Cascade Co. *		19,300		482,886
Calgon Carbon Corp. *		82,100		1,644,463
Century Aluminum Co. *		73,900		1,016,125
Chase Corp.		8,600		267,804
Chemtura Corp. *		145,200		3,237,960
Clearwater Paper Corp. *		32,100		1,970,619
Coeur Mining, Inc. *		154,650		1,339,269
Commercial Metals Co.		172,600		3,313,920
Deltic Timber Corp.		17,204		1,045,143
Ferro Corp. *		110,900		1,439,482
Flotek Industries, Inc. *		70,900		1,985,909
FutureFuel Corp.		31,000		622,170
General Moly, Inc. *(c)		90,300		99,330
Globe Specialty Metals, Inc.		97,300		1,885,674
Gold Resource Corp. (c)		47,300		218,053
Graphic Packaging Holding Co. *		296,515		3,042,244
H.B. Fuller Co.		75,916		3,517,188
Handy & Harman Ltd. *		7,800		176,358
Hawkins, Inc.		15,500		561,100
Haynes International, Inc.		19,825		1,051,716
Headwaters, Inc. *		112,100		1,399,008
Hecla Mining Co.		490,500		1,505,835
Horsehead Holding Corp. *		73,200		1,141,188
Innophos Holdings, Inc.		32,900		1,856,876
Innospec, Inc.		35,600		1,532,936
Intrepid Potash, Inc. *(c)		86,500		1,409,950
Kaiser Aluminum Corp.		28,750		2,024,000
KapStone Paper & Packaging Corp. *		122,100		3,220,998
KMG Chemicals, Inc.		12,300		192,003
Koppers Holdings, Inc.		30,900		1,319,430
Kraton Performance Polymers, Inc. *		47,500		1,237,375
Landec Corp. *		35,300		418,658
Louisiana-Pacific Corp. *		205,500		3,368,145
LSB Industries, Inc. *		28,000		1,069,320
Marrone Bio Innovations, Inc. *(c)		7,800		95,004
Materion Corp.		29,600		996,040
Midway Gold Corp. *(c)		186,800		170,829
Minerals Technologies, Inc.		52,922		3,148,330
Molycorp, Inc. *(c)		214,300		1,017,925
Myers Industries, Inc.		43,900		820,930
Neenah Paper, Inc.		23,300		1,173,621
Noranda Aluminum Holding Corp.		45,700		162,235
Olin Corp.		118,700		3,335,470
Olympic Steel, Inc.		12,200		321,592
OM Group, Inc.		48,100		1,408,849
OMNOVA Solutions, Inc. *		65,700		599,184
P.H. Glatfelter Co.		63,800		1,628,176
Paramount Gold & Silver Corp. *(c)		179,300		181,093
Penford Corp. *		13,700		172,620
PolyOne Corp.		144,554		5,416,438
Quaker Chemical Corp.		20,100		1,496,043
Resolute Forest Products, Inc. *		105,600		1,883,904
RTI International Metals, Inc. *		48,466		1,364,803
Schnitzer Steel Industries, Inc., Class A		37,800		1,061,046
Schweitzer-Mauduit International, Inc.		47,700		2,081,628
Sensient Technologies Corp.		74,125		4,006,456
Stepan Co.		28,500		1,648,155
Stillwater Mining Co. *		175,600		2,770,968
SunCoke Energy, Inc. *		105,700		2,205,959
Taminco Corp. *		22,500		452,025
Texas Industries, Inc. *		33,051		2,865,522
Tredegar Corp.		35,100		730,431
UFP Technologies, Inc. *		7,500		190,200
United States Lime & Minerals, Inc.		2,700		145,962

28 See financial notes

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Universal Stainless & Alloy Products, Inc. *		9,500		340,955
US Concrete, Inc. *		19,200		472,704
US Silica Holdings, Inc.		33,400		1,508,678
Walter Energy, Inc. (c)		89,200		642,240
Wausau Paper Corp.		70,400		841,984
Worthington Industries, Inc.		79,760		2,935,168
Zep, Inc.		32,600		563,654
				119,019,366
Media 1.3%
AH Belo Corp., Class A		26,900		309,619
AMC Entertainment Holdings, Inc., Class A *		31,500		728,910
Beasley Broadcasting Group, Inc., Class A		13,100		100,870
Carmike Cinemas, Inc. *		34,100		1,011,406
Central European Media Enterprises Ltd., Class A *		109,100		298,934
Crown Media Holdings, Inc., Class A *		46,700		167,186
Cumulus Media, Inc., Class A *		139,900		896,759
Daily Journal Corp. *		1,300		229,190
Dex Media, Inc. *(c)		24,400		178,852
Entercom Communications Corp., Class A *		32,400		349,920
Entravision Communications Corp., Class A		78,600		417,366
Global Sources Ltd. *		25,900		230,251
Gray Television, Inc. *		71,700		806,625
Harte-Hanks, Inc.		61,316		492,980
Hemisphere Media Group, Inc. *		12,300		148,830
Journal Communications, Inc., Class A *		71,200		571,024
Live Nation Entertainment, Inc. *		208,900		4,361,832
Loral Space & Communications, Inc. *		20,600		1,482,994
Martha Stewart Living Omnimedia, Inc., Class A *		36,500		142,715
MDC Partners, Inc., Class A		59,500		1,452,990
Media General, Inc. *(c)		27,900		427,428
Meredith Corp.		54,100		2,384,187
National CineMedia, Inc.		94,200		1,430,898
Nexstar Broadcasting Group, Inc., Class A		44,600		1,777,310
ReachLocal, Inc. *		13,400		134,000
Reading International, Inc., Class A *		23,000		162,840
Rentrak Corp. *		14,900		849,151
Saga Communications, Inc., Class A		6,400		283,520
Salem Communications Corp., Class A		14,100		124,221
Scholastic Corp.		38,469		1,266,015
SFX Entertainment, Inc. *(c)		29,000		190,240
Sinclair Broadcast Group, Inc., Class A		103,600		2,769,228
Sizmek, Inc. *		36,700		351,586
The E.W. Scripps Co., Class A *		50,500		865,065
The McClatchy Co., Class A *		102,100		559,508
The New York Times Co., Class A		192,000		3,087,360
World Wrestling Entertainment, Inc., Class A		41,400		807,300
				31,849,110
Pharmaceuticals, Biotechnology & Life Sciences 5.9%
ACADIA Pharmaceuticals, Inc. *		115,400		2,323,002
Accelerate Diagnostics, Inc. *(c)		14,800		272,764
Acceleron Pharma, Inc. *		12,100		415,635
AcelRx Pharmaceuticals, Inc. *(c)		40,200		434,964
Achillion Pharmaceuticals, Inc. *(c)		137,600		392,160
Acorda Therapeutics, Inc. *		60,200		2,134,090
Aegerion Pharmaceuticals, Inc. *		43,100		1,907,606
Aerie Pharmaceuticals, Inc. *		11,200		175,392
Affymetrix, Inc. *		110,900		823,987
Agios Pharmaceuticals, Inc. *(c)		9,800		412,188
Akorn, Inc. *		89,600		2,259,712
Albany Molecular Research, Inc. *		33,200		533,192
Alimera Sciences, Inc. *(c)		45,500		276,640
Alnylam Pharmaceuticals, Inc. *		86,800		4,299,204
AMAG Pharmaceuticals, Inc. *		30,500		556,930
Amicus Therapeutics, Inc. *		41,400		91,908
Ampio Pharmaceuticals, Inc. *(c)		58,200		354,438
Anacor Pharmaceuticals, Inc. *		36,100		594,567
Aratana Therapeutics, Inc. *		9,400		129,532
Arena Pharmaceuticals, Inc. *(c)		321,600		2,058,240
Argos Therapeutics, Inc. *		12,000		106,560
Arqule, Inc. *		83,300		134,946
Array BioPharma, Inc. *		179,400		714,012
Auspex Pharmaceuticals, Inc. *		12,000		257,280
Auxilium Pharmaceuticals, Inc. *		74,900		1,685,999
AVANIR Pharmaceuticals, Inc., Class A *		208,300		1,037,334
AVEO Pharmaceuticals, Inc. *		64,900		79,827
BIND Therapeutics, Inc. *(c)		7,800		73,554
BioDelivery Sciences International, Inc. *		49,500		441,045
BioTime, Inc. *		51,000		132,090
Bluebird Bio, Inc. *		9,800		194,040
Cambrex Corp. *		43,300		887,217
Cara Therapeutics, Inc. *(c)		8,000		115,120
Cell Therapeutics, Inc. *(c)		190,800		562,860
Celladon Corp. *		10,100		118,675
Celldex Therapeutics, Inc. *		133,300		1,999,500
Cellular Dynamics International, Inc. *(c)		6,200		74,090
Cempra, Inc. *		28,200		257,184
Cepheid, Inc. *		100,500		4,369,740
Chelsea Therapeutics International Ltd. *(c)		113,800		555,344
ChemoCentryx, Inc. *(c)		35,000		191,800
Chimerix, Inc. *		12,100		233,772
Clovis Oncology, Inc. *		26,000		1,405,820
Conatus Pharmaceuticals, Inc. *(c)		12,700		78,105
Concert Pharmaceuticals, Inc. *		9,900		88,506
Corcept Therapeutics, Inc. *		68,400		302,328
Coronado Biosciences, Inc. *(c)		38,300		66,642
Curis, Inc. *		149,000		336,740

See financial notes 29

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Cytokinetics, Inc. *		45,900		208,845
Cytori Therapeutics, Inc. *(c)		78,000		176,280
Dendreon Corp. *(c)		227,500		586,950
Depomed, Inc. *		86,900		1,217,469
Dicerna Pharmaceuticals, Inc. *(c)		5,200		97,604
Durata Therapeutics, Inc. *(c)		25,300		342,562
Dyax Corp. *		201,100		1,329,271
Dynavax Technologies Corp. *		381,000		621,030
Eagle Pharmaceuticals, Inc. *		9,800		96,628
Egalet Corp. *		9,500		109,820
Eleven Biotherapeutics, Inc. *(c)		7,500		101,175
Emergent Biosolutions, Inc. *		39,100		1,030,676
Enanta Pharmaceuticals, Inc. *		5,300		197,213
Endocyte, Inc. *(c)		50,400		912,744
Enzon Pharmaceuticals, Inc.		58,000		51,626
Epizyme, Inc. *		8,400		183,288
Esperion Therapeutics, Inc. *(c)		7,100		97,909
Exact Sciences Corp. *(c)		123,900		1,486,800
Exelixis, Inc. *(c)		292,872		1,036,767
Fibrocell Science, Inc. *		24,000		91,200
Five Prime Therapeutics, Inc. *		8,100		113,157
Flexion Therapeutics, Inc. *		7,800		92,430
Fluidigm Corp. *		39,800		1,494,888
Foundation Medicine, Inc. *(c)		10,000		291,600
Furiex Pharmaceuticals, Inc. *		10,000		1,033,700
Galena Biopharma, Inc. *(c)		189,700		464,765
Genocea Biosciences, Inc. *		7,100		137,740
Genomic Health, Inc. *		27,200		713,728
Geron Corp. *(c)		231,200		457,776
GlycoMimetics, Inc. *		12,000		159,240
GTx, Inc. *(c)		118,100		181,874
Halozyme Therapeutics, Inc. *		144,000		1,072,800
Harvard Apparatus Regenerative Technology, Inc. *		32,300		279,395
Harvard Bioscience, Inc. *		30,800		129,976
Horizon Pharma, Inc. *(c)		83,100		1,178,358
Hyperion Therapeutics, Inc. *		14,400		354,816
Idenix Pharmaceuticals, Inc. *(c)		167,600		923,476
ImmunoGen, Inc. *		128,000		1,656,320
Immunomedics, Inc. *(c)		103,500		435,735
Impax Laboratories, Inc. *		101,900		2,664,685
Infinity Pharmaceuticals, Inc. *		68,300		667,291
Insmed, Inc. *		49,300		687,242
Insys Therapeutics, Inc. *		10,800		443,448
Intercept Pharmaceuticals, Inc. *		11,000		2,905,320
InterMune, Inc. *		146,800		4,709,344
Intrexon Corp. *(c)		16,400		309,632
Ironwood Pharmaceuticals, Inc. *		158,800		1,749,976
Isis Pharmaceuticals, Inc. *		168,200		4,475,802
KaloBios Pharmaceuticals, Inc. *(c)		23,400		53,118
Karyopharm Therapeutics, Inc. *		11,300		303,179
Keryx Biopharmaceuticals, Inc. *(c)		130,600		1,928,962
Kindred Biosciences, Inc. *		12,900		204,981
KYTHERA Biopharmaceuticals, Inc. *		17,000		554,370
Lannett Co., Inc. *		26,900		928,857
Lexicon Pharmaceuticals, Inc. *		324,100		499,114
Ligand Pharmaceuticals, Inc. *		27,400		1,730,858
Luminex Corp. *		53,200		1,021,972
MacroGenics, Inc. *		8,300		165,502
MannKind Corp. *(c)		233,500		1,529,425
MEI Pharma, Inc. *(c)		13,700		107,134
Merrimack Pharmaceuticals, Inc. *(c)		153,100		672,109
MiMedx Group, Inc. *		131,700		761,226
Momenta Pharmaceuticals, Inc. *		71,144		812,464
Nanosphere, Inc. *		59,900		102,429
Navidea Biopharmaceuticals, Inc. *(c)		152,800		255,176
Nektar Therapeutics *		183,071		2,154,746
NeoGenomics, Inc. *		46,900		155,239
Neurocrine Biosciences, Inc. *		112,600		1,578,652
NewLink Genetics Corp. *(c)		25,300		556,600
Novavax, Inc. *		268,000		1,173,840
NPS Pharmaceuticals, Inc. *		148,500		3,953,070
Omeros Corp. *(c)		51,500		637,570
OncoGenex Pharmaceutical, Inc. *		19,500		75,660
OncoMed Pharmaceuticals, Inc. *(c)		8,200		215,988
Onconova Therapeutics, Inc. *(c)		8,500		47,430
Ophthotech Corp. *(c)		12,900		438,471
OPKO Health, Inc. *(c)		281,800		2,330,486
Orexigen Therapeutics, Inc. *		166,700		936,854
Osiris Therapeutics, Inc. *(c)		22,300		317,329
OvaScience, Inc. *		12,800		103,936
Pacific Biosciences of California, Inc. *		85,600		378,352
Pacira Pharmaceuticals, Inc. *		44,500		3,047,805
PAREXEL International Corp. *		85,418		3,873,706
PDL BioPharma, Inc. (c)		239,600		2,034,204
Peregrine Pharmaceuticals, Inc. *(c)		255,100		443,874
Pernix Therapeutics Holdings *		37,100		178,451
Portola Pharmaceuticals, Inc. *		17,500		410,550
Pozen, Inc. *		35,400		295,944
Prestige Brands Holdings, Inc. *		78,700		2,638,024
Progenics Pharmaceuticals, Inc. *		106,000		374,180
Prothena Corp. plc *		20,500		451,000
PTC Therapeutics, Inc. *		16,900		330,226
Puma Biotechnology, Inc. *		34,800		2,628,792
Questcor Pharmaceuticals, Inc.		77,500		6,368,950
Raptor Pharmaceutical Corp. *(c)		93,100		769,937
Receptos, Inc. *		10,900		368,311
Regulus Therapeutics, Inc. *		18,100		129,053
Relypsa, Inc. *		8,800		196,504
Repligen Corp. *		49,100		778,235
Repros Therapeutics, Inc. *		32,700		551,649
Retrophin, Inc. *		28,400		405,836
Revance Therapeutics, Inc. *		10,300		353,084
Rigel Pharmaceuticals, Inc. *		118,400		378,880
Sagent Pharmaceuticals, Inc. *		30,300		626,907
Sangamo BioSciences, Inc. *		99,700		1,379,848
Sarepta Therapeutics, Inc. *(c)		57,300		2,127,549
Sciclone Pharmaceuticals, Inc. *		78,000		372,840
Sequenom, Inc. *(c)		166,100		453,453
SIGA Technologies, Inc. *(c)		46,100		132,307
Spectrum Pharmaceuticals, Inc. *		89,800		616,926
Stemline Therapeutics, Inc. *		13,000		199,030
Sucampo Pharmaceuticals, Inc., Class A *		17,000		117,470

30 See financial notes

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Sunesis Pharmaceuticals, Inc. *		53,500		274,455
Supernus Pharmaceuticals, Inc. *		31,800		261,078
Synageva BioPharma Corp. *		30,800		2,660,196
Synergy Pharmaceuticals, Inc. *(c)		114,800		515,452
Synta Pharmaceuticals Corp. *(c)		87,300		367,533
Targacept, Inc. *		37,100		164,724
TESARO, Inc. *		22,100		551,616
TetraLogic Pharmaceuticals Corp. *(c)		20,200		115,140
Tetraphase Pharmaceuticals, Inc. *		22,700		243,798
TG Therapeutics, Inc. *(c)		49,800		265,434
The Medicines Co. *		93,408		2,484,653
TherapeuticsMD, Inc. *(c)		124,300		522,060
Threshold Pharmaceuticals, Inc. *		61,700		252,970
Trevena, Inc. *		18,500		92,685
Ultragenyx Pharmaceutical, Inc. *		9,900		383,922
Vanda Pharmaceuticals, Inc. *		47,300		658,889
Verastem, Inc. *		30,000		250,500
Vical, Inc. *		113,400		128,142
Vivus, Inc. *(c)		147,300		765,960
Xencor, Inc. *		21,900		216,810
XenoPort, Inc. *		80,000		324,800
XOMA Corp. *		113,500		503,940
ZIOPHARM Oncology, Inc. *(c)		116,700		420,120
Zogenix, Inc. *		154,200		376,248
				149,226,401
Real Estate 8.3%
Acadia Realty Trust		82,436		2,236,489
AG Mortgage Investment Trust, Inc.		41,300		730,597
Agree Realty Corp.		21,600		645,192
Alexander & Baldwin, Inc.		64,100		2,391,571
Alexander’s, Inc.		3,300		1,141,008
Altisource Residential Corp.		82,800		2,328,336
American Assets Trust, Inc.		52,100		1,768,795
American Capital Mortgage Investment Corp.		76,700		1,518,660
American Realty Capital Properties, Inc.		702,700		9,198,343
American Residential Properties, Inc. *		19,500		350,415
AmREIT, Inc., Class B		28,100		468,146
Anworth Mortgage Asset Corp.		226,500		1,223,100
Apollo Commercial Real Estate Finance, Inc.		52,600		894,726
Apollo Residential Mortgage, Inc.		51,700		834,955
Ares Commercial Real Estate Corp.		30,500		389,180
Armada Hoffler Properties, Inc.		27,100		262,328
ARMOUR Residential REIT, Inc.		558,800		2,369,312
Ashford Hospitality Prime, Inc.		26,920		412,953
Ashford Hospitality Trust, Inc.		101,000		1,036,260
Associated Estates Realty Corp.		88,100		1,478,318
AV Homes, Inc. *		15,600		267,228
Aviv REIT, Inc.		21,700		572,663
Campus Crest Communities, Inc.		92,100		792,981
Capstead Mortgage Corp.		141,200		1,804,536
CatchMark Timber Trust, Inc., Class A (c)		18,100		243,988
Cedar Realty Trust, Inc.		103,100		638,189
Chambers Street Properties		354,900		2,764,671
Chatham Lodging Trust		37,900		770,507
Chesapeake Lodging Trust		74,300		2,005,357
Colony Financial, Inc.		138,000		3,001,500
Consolidated-Tomoka Land Co.		8,300		328,099
CoreSite Realty Corp.		31,300		952,146
Cousins Properties, Inc.		249,273		2,899,045
CubeSmart		209,700		3,900,420
CyrusOne, Inc.		27,100		542,000
CYS Investments, Inc.		261,600		2,249,760
DCT Industrial Trust, Inc.		472,300		3,693,386
DiamondRock Hospitality Co.		288,917		3,545,012
DuPont Fabros Technology, Inc.		94,000		2,277,620
Dynex Capital, Inc.		76,500		656,370
EastGroup Properties, Inc.		44,790		2,832,967
Education Realty Trust, Inc.		173,000		1,764,600
Ellington Residential Mortgage REIT		9,200		150,328
Empire State Realty Trust, Inc., Class A		127,900		1,956,870
EPR Properties		76,400		4,095,804
Equity One, Inc.		90,337		2,035,293
Excel Trust, Inc.		77,500		978,050
FelCor Lodging Trust, Inc.		186,400		1,720,472
First Industrial Realty Trust, Inc.		159,800		2,935,526
First Potomac Realty Trust		90,700		1,181,821
Forestar Group, Inc. *		49,700		847,385
Franklin Street Properties Corp.		134,065		1,632,912
Getty Realty Corp.		39,242		742,459
Gladstone Commercial Corp.		24,300		428,652
Glimcher Realty Trust		216,800		2,209,192
Government Properties Income Trust		82,100		2,089,445
Gramercy Property Trust, Inc.		84,600		441,612
Hannon Armstrong Sustainable Infrastructure Capital, Inc.		21,000		277,620
Healthcare Realty Trust, Inc.		142,081		3,573,337
Hersha Hospitality Trust		311,200		1,808,072
Highwoods Properties, Inc.		133,900		5,402,865
Hudson Pacific Properties, Inc.		73,600		1,733,280
Inland Real Estate Corp.		133,336		1,393,361
Invesco Mortgage Capital, Inc.		199,700		3,328,999
Investors Real Estate Trust		153,200		1,335,904
iStar Financial, Inc. *		125,500		1,864,930
JAVELIN Mortgage Investment Corp.		18,700		247,027
Kennedy-Wilson Holdings, Inc.		95,000		2,074,800
Kite Realty Group Trust		189,500		1,174,900
LaSalle Hotel Properties		156,426		5,174,572
Lexington Realty Trust		268,084		2,884,584
LTC Properties, Inc.		53,067		2,049,978
Medical Properties Trust, Inc.		256,100		3,457,350
Monmouth Real Estate Investment Corp., Class A		73,900		693,921
National Health Investors, Inc.		44,268		2,730,893
New Residential Investment Corp.		376,700		2,297,870
New York Mortgage Trust, Inc.		135,700		1,000,109
NorthStar Realty Finance Corp.		488,600		7,827,372

See financial notes 31

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
One Liberty Properties, Inc.		18,700		413,831
Parkway Properties, Inc.		86,493		1,631,258
Pebblebrook Hotel Trust		90,800		3,127,152
Pennsylvania Real Estate Investment Trust		103,812		1,718,089
PennyMac Mortgage Investment Trust		104,700		2,454,168
Physicians Realty Trust		29,200		400,624
Potlatch Corp.		60,403		2,309,207
PS Business Parks, Inc.		28,438		2,439,127
QTS Realty Trust, Inc.		20,400		555,900
RAIT Financial Trust		119,300		975,874
Ramco-Gershenson Properties Trust		96,600		1,591,968
RE/MAX Holdings, Inc.		16,800		474,096
Redwood Trust, Inc.		123,500		2,692,300
Resource Capital Corp.		198,300		1,090,650
Retail Opportunity Investments Corp.		109,500		1,712,580
Rexford Industrial Realty, Inc.		24,200		344,124
RLJ Lodging Trust		186,300		4,968,621
Rouse Properties, Inc.		43,100		723,649
Ryman Hospitality Properties, Inc. (c)		65,650		2,990,357
Sabra Health Care REIT, Inc.		56,066		1,680,298
Saul Centers, Inc.		10,800		495,612
Select Income REIT		31,200		960,336
Silver Bay Realty Trust Corp.		21,733		325,560
Sovran Self Storage, Inc.		46,726		3,546,503
STAG Industrial, Inc.		68,200		1,604,746
Strategic Hotels & Resorts, Inc. *		269,800		2,911,142
Summit Hotel Properties, Inc.		113,900		1,031,934
Sun Communities, Inc.		60,300		2,747,871
Sunstone Hotel Investors, Inc.		273,310		3,911,066
Tejon Ranch Co. *		19,092		592,043
Terreno Realty Corp.		35,600		650,412
The Geo Group, Inc.		106,780		3,580,333
UMH Properties, Inc.		31,900		314,215
Universal Health Realty Income Trust		16,900		717,067
Urstadt Biddle Properties, Inc., Class A		34,600		706,186
Washington Real Estate Investment Trust		100,100		2,448,446
Western Asset Mortgage Capital Corp. (c)		59,656		881,119
Whitestone REIT		30,700		430,721
Winthrop Realty Trust		46,700		649,130
ZAIS Financial Corp.		8,000		131,920
				208,889,529
Retailing 3.8%
1-800-Flowers.com, Inc., Class A *		34,800		189,660
Aeropostale, Inc. *(c)		115,000		571,550
America’s Car-Mart, Inc. *		11,500		415,610
ANN, Inc. *		69,000		2,704,110
Asbury Automotive Group, Inc. *		47,100		2,907,954
Barnes & Noble, Inc. *		57,600		944,640
bebe stores, Inc.		51,449		259,817
Big 5 Sporting Goods Corp.		22,600		275,946
Blue Nile, Inc. *		19,000		659,870
Body Central Corp. *(c)		22,200		23,088
Brown Shoe Co., Inc.		67,275		1,587,017
Burlington Stores, Inc. *		22,200		576,978
Christopher & Banks Corp. *		51,800		323,232
Citi Trends, Inc. *		20,100		341,499
Conn’s, Inc. *(c)		34,700		1,534,781
Core-Mark Holding Co., Inc.		18,200		1,465,828
Destination Maternity Corp.		18,400		453,744
Destination XL Group, Inc. *		56,400		304,560
Express, Inc. *		128,500		1,872,245
Five Below, Inc. *		49,500		1,995,345
Francesca’s Holdings Corp. *		62,800		1,027,408
Fred’s, Inc., Class A		52,800		962,016
FTD Cos., Inc. *		28,097		852,463
Genesco, Inc. *		36,244		2,767,954
Gordmans Stores, Inc.		11,600		52,084
Group 1 Automotive, Inc.		32,400		2,337,012
Haverty Furniture Cos, Inc.		30,300		773,862
hhgregg, Inc. *(c)		18,300		157,746
Hibbett Sports, Inc. *		39,875		2,147,269
HSN, Inc.		50,200		2,913,608
Jos. A. Bank Clothiers, Inc. *		41,718		2,692,897
Kirkland’s, Inc. *		22,400		383,264
Lithia Motors, Inc., Class A		33,700		2,503,236
Lumber Liquidators Holdings, Inc. *		41,600		3,625,856
MarineMax, Inc. *		37,700		605,462
Mattress Firm Holding Corp. *(c)		19,200		867,648
Monro Muffler Brake, Inc.		45,750		2,580,300
New York & Co., Inc. *		36,400		152,516
Nutrisystem, Inc.		39,948		599,220
Office Depot, Inc. *		717,310		2,933,798
Orbitz Worldwide, Inc. *		41,700		306,495
Outerwall, Inc. *(c)		33,000		2,288,550
Overstock.com, Inc. *		15,500		248,310
Pacific Sunwear of California, Inc. *		65,800		189,504
Penske Automotive Group, Inc.		62,616		2,871,570
PetMed Express, Inc.		29,500		386,155
Pier 1 Imports, Inc.		133,800		2,443,188
Pool Corp.		69,877		4,124,141
RadioShack Corp. *(c)		136,500		195,195
Rent-A-Center, Inc.		79,105		2,310,657
Restoration Hardware Holdings, Inc. *		27,200		1,697,008
RetailMeNot, Inc. *		13,400		399,454
Sears Hometown & Outlet Stores, Inc. *		12,300		290,403
Select Comfort Corp. *		86,700		1,595,280
Shoe Carnival, Inc.		24,850		567,574
Shutterfly, Inc. *		56,600		2,316,638
Sonic Automotive, Inc., Class A		61,100		1,487,174
Stage Stores, Inc.		46,827		898,142
Stein Mart, Inc.		44,300		553,750
Systemax, Inc. *		14,500		250,705
The Bon-Ton Stores, Inc. (c)		19,300		212,300
The Buckle, Inc. (c)		41,664		1,957,791
The Cato Corp., Class A		42,204		1,202,392
The Children’s Place Retail Stores, Inc.		34,913		1,675,824

32 See financial notes

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
The Container Store Group, Inc. *(c)		20,900		576,631
The Finish Line, Inc., Class A		71,619		1,971,671
The Men’s Wearhouse, Inc.		71,100		3,368,718
The Pep Boys - Manny, Moe & Jack *		84,700		865,634
The Wet Seal, Inc., Class A *(c)		121,200		136,956
Tile Shop Holdings, Inc. *		26,300		370,699
Tilly’s, Inc., Class A *		12,600		142,380
Trans World Entertainment Corp.		42,800		139,956
Tuesday Morning Corp. *		65,800		919,884
ValueVision Media, Inc., Class A *		56,000		262,080
Vitacost.com, Inc. *		30,300		202,101
Vitamin Shoppe, Inc. *		45,400		2,173,752
VOXX International Corp. *		31,300		367,775
West Marine, Inc. *		24,500		262,150
Weyco Group, Inc.		9,100		228,319
Winmark Corp.		3,000		227,580
Zale Corp. *		46,300		990,357
Zumiez, Inc. *		30,100		735,945
				94,753,881
Semiconductors & Semiconductor Equipment 3.6%
Advanced Energy Industries, Inc. *		57,600		1,260,288
Alpha & Omega Semiconductor Ltd. *		28,000		201,600
Ambarella, Inc. *(c)		30,400		755,440
Amkor Technology, Inc. *		116,018		922,343
ANADIGICS, Inc. *		117,100		146,375
Applied Micro Circuits Corp. *		104,365		1,013,384
Audience, Inc. *		13,700		157,550
Axcelis Technologies, Inc. *		142,100		254,359
Brooks Automation, Inc.		105,331		1,077,536
Cabot Microelectronics Corp. *		35,700		1,548,309
Cavium, Inc. *		76,100		3,224,357
Ceva, Inc. *		33,700		546,951
Cirrus Logic, Inc. *		92,700		2,067,210
Cohu, Inc.		32,200		331,660
Cypress Semiconductor Corp. *		234,900		2,224,503
Diodes, Inc. *		54,281		1,431,390
DSP Group, Inc. *		31,400		249,944
Entegris, Inc. *		208,200		2,308,938
Entropic Communications, Inc. *		143,000		527,670
Exar Corp. *		58,500		632,970
FormFactor, Inc. *		76,873		442,020
GSI Technology, Inc. *		27,000		171,450
GT Advanced Technologies, Inc. *(c)		203,300		3,376,813
Hittite Microwave Corp.		46,609		2,766,710
Inphi Corp. *		37,200		550,188
Integrated Device Technology, Inc. *		197,400		2,303,658
Integrated Silicon Solution, Inc. *		46,000		665,160
Intermolecular, Inc. *		51,000		138,720
International Rectifier Corp. *		102,800		2,676,912
Intersil Corp., Class A		190,700		2,353,238
IXYS Corp.		32,400		349,596
Kopin Corp. *		100,300		326,978
Lattice Semiconductor Corp. *		170,200		1,433,084
LTX-Credence Corp. *		66,300		638,469
M/A-COM Technology Solutions Holdings, Inc. *		15,100		264,401
MaxLinear, Inc., Class A *		41,800		328,966
Micrel, Inc.		67,505		672,350
Microsemi Corp. *		137,419		3,232,095
MKS Instruments, Inc.		81,399		2,291,382
Monolithic Power Systems, Inc. *		58,100		2,155,510
MoSys, Inc. *		80,900		316,319
Nanometrics, Inc. *		32,200		523,572
NeoPhotonics Corp. *		26,800		154,636
NVE Corp. *		6,400		336,064
OmniVision Technologies, Inc. *		77,873		1,520,860
PDF Solutions, Inc. *		35,700		670,089
Peregrine Semiconductor Corp. *(c)		37,700		202,449
Pericom Semiconductor Corp. *		33,500		270,345
Photronics, Inc. *		85,200		739,536
PLX Technology, Inc. *		76,400		443,120
PMC-Sierra, Inc. *		305,600		2,090,304
Power Integrations, Inc.		43,362		2,047,987
Rambus, Inc. *		167,900		2,029,911
RF Micro Devices, Inc. *		423,000		3,570,120
Rubicon Technology, Inc. *(c)		32,500		329,225
Rudolph Technologies, Inc. *		46,700		425,437
Semtech Corp. *		100,229		2,403,491
Sigma Designs, Inc. *		43,000		162,110
Silicon Image, Inc. *		113,600		637,296
Spansion, Inc., Class A *		75,000		1,337,250
SunEdison, Inc. *		402,400		7,738,152
SunPower Corp. *(c)		63,200		2,112,144
Synaptics, Inc. *		49,500		3,076,425
Tessera Technologies, Inc.		76,490		1,677,426
TriQuint Semiconductor, Inc. *		246,900		3,501,042
Ultra Clean Holdings, Inc. *		31,900		271,788
Ultratech, Inc. *		40,000		1,064,800
Veeco Instruments, Inc. *		60,200		2,225,594
				89,897,969
Software & Services 8.2%
ACI Worldwide, Inc. *		59,215		3,384,137
Actuate Corp. *		67,700		381,151
Acxiom Corp. *		110,176		3,111,370
Advent Software, Inc.		50,528		1,456,217
American Software, Inc., Class A		42,400		408,736
Angie’s List, Inc. *		60,200		680,862
Aspen Technology, Inc. *		140,300		6,031,497
AVG Technologies NV *		34,100		638,693
Bankrate, Inc. *		66,600		1,166,832
Barracuda Networks, Inc. *(c)		6,000		154,980
Bazaarvoice, Inc. *		68,500		460,320
Benefitfocus, Inc. *(c)		7,400		239,760
Blackbaud, Inc.		69,469		2,115,331
Blackhawk Network Holdings, Inc. *(c)		75,400		1,808,846
Blucora, Inc. *		63,100		1,214,675
Bottomline Technologies de, Inc. *		56,700		1,793,988
Brightcove, Inc. *		40,100		345,662
BroadSoft, Inc. *		42,200		1,071,036
CACI International, Inc., Class A *		34,900		2,430,785
Callidus Software, Inc. *		64,000		610,880

See financial notes 33

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Carbonite, Inc. *		15,500		153,295
Cardtronics, Inc. *		67,100		2,246,508
Care.com, Inc. *(c)		9,800		120,050
Cass Information Systems, Inc.		15,640		789,976
ChannelAdvisor Corp. *		8,500		223,040
Chegg, Inc. *(c)		21,800		114,886
CIBER, Inc. *		100,000		432,000
CommVault Systems, Inc. *		69,800		3,378,320
Computer Task Group, Inc.		20,200		319,362
comScore, Inc. *		55,200		1,729,416
Comverse, Inc. *		32,070		799,826
Constant Contact, Inc. *		44,200		1,143,012
Convergys Corp.		160,300		3,452,862
Conversant, Inc. *		100,900		2,465,996
Cornerstone OnDemand, Inc. *		59,800		2,198,248
CoStar Group, Inc. *		42,675		6,865,981
Covisint Corp. *(c)		10,700		75,542
CSG Systems International, Inc.		51,100		1,346,996
Cvent, Inc. *		9,200		253,276
Cyan, Inc. *(c)		39,400		164,692
Datalink Corp. *		27,300		350,532
Dealertrack Technologies, Inc. *		64,736		2,957,788
Demand Media, Inc. *		51,600		214,656
Demandware, Inc. *		28,500		1,414,455
Dice Holdings, Inc. *		64,900		496,485
Digimarc Corp.		10,300		340,106
Digital River, Inc. *		52,800		807,312
E2open, Inc. *		25,300		436,931
EarthLink Holdings Corp.		147,381		502,569
Ebix, Inc. (c)		44,300		699,054
eGain Corp. *		18,600		121,644
Ellie Mae, Inc. *		41,700		1,017,063
Endurance International Group Holdings Inc *(c)		31,600		399,740
Envestnet, Inc. *		34,600		1,275,010
EPAM Systems, Inc. *		33,500		1,042,855
Epiq Systems, Inc.		48,700		622,873
ePlus, Inc. *		5,200		260,208
Euronet Worldwide, Inc. *		76,136		3,501,495
EVERTEC, Inc.		42,100		991,034
ExlService Holdings, Inc. *		51,300		1,451,533
Fair Isaac Corp.		53,100		3,037,320
FleetMatics Group plc *		25,300		759,759
Forrester Research, Inc.		19,717		698,573
Gigamon, Inc. *		11,100		175,047
Global Cash Access Holdings, Inc. *		104,100		687,060
Global Eagle Entertainment, Inc. *		41,200		454,436
Glu Mobile, Inc. *(c)		92,400		369,600
Gogo, Inc. *(c)		15,700		212,264
Guidance Software, Inc. *		31,700		291,957
Guidewire Software, Inc. *		73,000		2,756,480
Heartland Payment Systems, Inc.		54,500		2,231,230
Higher One Holdings, Inc. *		43,800		262,362
iGATE Corp. *		52,840		1,933,944
Imperva, Inc. *		30,800		704,704
Infoblox, Inc. *		80,300		1,575,486
Interactive Intelligence Group, Inc. *		23,500		1,470,395
Internap Network Services Corp. *		75,700		508,704
Intralinks Holdings, Inc. *		61,900		566,385
j2 Global, Inc.		67,928		3,149,142
Jive Software, Inc. *		56,400		421,872
Limelight Networks, Inc. *		90,900		188,163
Lionbridge Technologies, Inc. *		82,500		485,100
Liquidity Services, Inc. *(c)		35,400		610,650
LivePerson, Inc. *		78,700		779,130
LogMeIn, Inc. *		38,400		1,745,280
Luxoft Holding, Inc. *		6,700		180,833
Manhattan Associates, Inc. *		114,988		3,625,572
ManTech International Corp., Class A		34,500		1,029,135
Marchex, Inc., Class B		36,700		339,475
Marin Software, Inc. *		13,100		122,878
Marketo, Inc. *		9,900		268,686
Mavenir Systems, Inc. *		10,300		153,676
MAXIMUS, Inc.		101,496		4,320,685
Mentor Graphics Corp.		140,967		2,918,017
MicroStrategy, Inc., Class A *		13,662		1,658,977
Millennial Media, Inc. *(c)		50,300		321,417
Mitek Systems, Inc. *(c)		31,700		103,342
Model N, Inc. *		11,600		104,516
ModusLink Global Solutions, Inc. *		58,700		237,148
MoneyGram International, Inc. *		29,500		389,400
Monotype Imaging Holdings, Inc.		58,600		1,547,626
Monster Worldwide, Inc. *		166,500		1,147,185
Move, Inc. *		57,400		613,606
Net Element International, Inc. *(c)		18,500		41,255
Netscout Systems, Inc. *		55,400		2,158,384
NIC, Inc.		96,800		1,775,312
OpenTable, Inc. *		34,500		2,317,020
Pegasystems, Inc.		53,200		881,524
Perficient, Inc. *		47,700		871,479
Planet Payment, Inc. *		60,600		159,378
PRGX Global, Inc. *		41,500		266,845
Progress Software Corp. *		80,320		1,723,667
Proofpoint, Inc. *		33,400		849,696
PROS Holdings, Inc. *		34,000		931,600
PTC, Inc. *		178,800		6,324,156
QAD, Inc., Class A		8,800		167,640
Qlik Technologies, Inc. *		129,800		2,853,004
Qualys, Inc. *		21,200		408,948
QuinStreet, Inc. *		44,900		273,890
Rally Software Development Corp. *		9,800		128,184
RealNetworks, Inc. *		28,257		213,058
RealPage, Inc. *		71,900		1,276,225
Reis, Inc. *		11,900		195,874
Rocket Fuel, Inc. *(c)		7,100		227,697
Rosetta Stone, Inc. *		14,700		175,077
Sapiens International Corp. N.V. *		28,400		223,508
Sapient Corp. *		163,663		2,662,797
SciQuest, Inc. *		38,300		918,434
Seachange International, Inc. *		46,700		437,579
ServiceSource International, Inc. *		87,100		543,504
Shutterstock, Inc. *		10,600		768,606
Silver Spring Networks, Inc. *		8,400		125,832
Spark Networks, Inc. *(c)		25,100		113,703
SPS Commerce, Inc. *		23,400		1,212,120

34 See financial notes

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
SS&C Technologies Holdings, Inc. *		87,500		3,405,500
Stamps.com, Inc. *		19,400		673,374
support.com, Inc. *		64,900		160,303
Sykes Enterprises, Inc. *		59,793		1,183,303
Synchronoss Technologies, Inc. *		45,200		1,375,888
Syntel, Inc. *		22,900		1,839,328
Take-Two Interactive Software, Inc. *		120,504		2,455,871
Tangoe, Inc. *		44,200		664,768
TechTarget, Inc. *		19,000		121,980
TeleCommunication Systems, Inc., Class A *		67,800		172,890
Telenav, Inc. *		22,100		135,473
TeleTech Holdings, Inc. *		28,400		685,292
Textura, Corp. *(c)		7,500		133,575
The Hackett Group, Inc.		40,800		244,800
The Ultimate Software Group, Inc. *		40,900		4,892,867
TiVo, Inc. *		190,703		2,261,738
Travelzoo, Inc. *		9,800		175,812
Tremor Video, Inc. *(c)		37,900		170,929
Trulia, Inc. *(c)		42,405		1,441,770
Tyler Technologies, Inc. *		47,100		3,845,715
Unisys Corp. *		76,450		1,863,086
United Online, Inc.		20,069		237,818
Unwired Planet, Inc. *		122,695		279,745
Varonis Systems, Inc. *		7,900		199,633
VASCO Data Security International, Inc. *		40,200		458,682
Verint Systems, Inc. *		78,005		3,414,279
VirnetX Holding Corp. *(c)		65,700		1,034,775
Virtusa Corp. *		33,300		1,097,901
Vistaprint N.V. *		48,600		1,918,242
Vocus, Inc. *		28,300		508,834
Vringo, Inc. *(c)		95,600		391,004
Web.com Group, Inc. *		63,500		1,950,085
WebMD Health Corp. *		43,800		1,931,142
WEX, Inc. *		57,976		5,563,957
Wix.com Ltd. *(c)		12,100		247,929
XO Group, Inc. *		39,800		422,676
Xoom Corp. *		10,400		232,024
Yelp, Inc. *		48,500		2,828,520
YuMe, Inc. *(c)		12,100		80,949
Zillow, Inc., Class A *(c)		34,900		3,793,630
Zix Corp. *		88,900		291,592
				207,853,277
Technology Hardware & Equipment 4.7%
ADTRAN, Inc.		88,500		1,985,055
Aeroflex Holding Corp. *		26,600		203,490
Agilysys, Inc. *		24,000		300,960
Alliance Fiber Optic Products, Inc. (c)		16,400		315,208
Anixter International, Inc.		40,600		3,977,988
Applied Optoelectronics, Inc. *		7,800		175,500
ARRIS Group, Inc. *		172,860		4,509,917
Aruba Networks, Inc. *		169,900		3,358,923
Aviat Networks, Inc. *		81,200		122,612
Badger Meter, Inc.		22,203		1,100,159
Bel Fuse, Inc., Class B		14,100		306,816
Belden, Inc.		66,300		4,893,603
Benchmark Electronics, Inc. *		81,294		1,884,395
Black Box Corp.		24,092		512,196
CalAmp Corp. *		53,500		949,625
Calix, Inc. *		58,800		518,028
Checkpoint Systems, Inc. *		61,644		787,194
Ciena Corp. *		150,100		2,967,477
Cognex Corp. *		130,418		4,490,292
Coherent, Inc. *		36,651		2,188,431
Comtech Telecommunications Corp.		24,500		777,875
Control4 Corp. *		7,000		123,620
Cray, Inc. *		59,800		1,716,858
CTS Corp.		52,200		928,638
Daktronics, Inc.		59,300		772,086
Digi International, Inc. *		33,900		300,354
DTS, Inc. *		24,942		464,171
Electro Rent Corp.		25,200		406,980
Electro Scientific Industries, Inc.		39,800		337,504
Electronics for Imaging, Inc. *		68,609		2,592,734
Emulex Corp. *		129,190		923,708
Extreme Networks, Inc. *		135,200		773,344
Fabrinet *		40,400		872,640
FARO Technologies, Inc. *		25,200		1,005,480
FEI Co.		62,400		4,962,048
Finisar Corp. *		138,400		3,619,160
Fusion-io, Inc. *		118,400		1,021,792
GSI Group, Inc. *		48,200		585,148
Harmonic, Inc. *		160,700		1,129,721
Hutchinson Technology, Inc. *		33,400		92,852
II-VI, Inc. *		76,900		1,107,360
Imation Corp. *		63,000		272,160
Immersion Corp. *		38,200		433,188
Infinera Corp. *		176,300		1,579,648
Insight Enterprises, Inc. *		65,500		1,710,860
InterDigital, Inc.		62,700		2,176,944
InvenSense, Inc. *(c)		87,300		1,879,569
Itron, Inc. *		59,100		2,245,800
Ixia *		80,464		999,363
Kemet Corp. *		59,100		296,091
KVH Industries, Inc. *		19,900		268,849
Littelfuse, Inc.		33,200		3,006,260
Maxwell Technologies, Inc. *		43,400		653,604
Measurement Specialties, Inc. *		23,400		1,505,790
Mercury Systems, Inc. *		44,600		622,616
Mesa Laboratories, Inc.		3,600		308,520
Methode Electronics, Inc.		56,700		1,572,858
MTS Systems Corp.		23,775		1,532,774
Multi-Fineline Electronix, Inc. *		12,100		149,798
Neonode, Inc. *(c)		51,200		273,920
NETGEAR, Inc. *		58,500		1,889,550
Newport Corp. *		57,700		1,077,836
Numerex Corp., Class A *		25,600		262,400
Oplink Communications, Inc. *		26,200		449,068
OSI Systems, Inc. *		30,100		1,679,881
Park Electrochemical Corp.		29,300		781,138
Parkervision, Inc. *(c)		144,400		658,464
PC Connection, Inc.		12,500		250,125
PC-Tel, Inc.		25,400		209,550
Plantronics, Inc.		64,093		2,792,532
Plexus Corp. *		51,962		2,178,247
Procera Networks, Inc. *		28,000		259,280

See financial notes 35

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

		Number		Value
Security		of Shares		($)
QLogic Corp. *			130,100		1,506,558
Quantum Corp. *			321,700		347,436
Radisys Corp. *	��		38,000		121,600
RealD, Inc. *			60,400		661,984
Richardson Electronics Ltd.			18,900		189,378
Rofin-Sinar Technologies, Inc. *			40,036		888,799
Rogers Corp. *			26,167		1,570,543
Ruckus Wireless, Inc. *			67,100		701,195
Sanmina Corp. *			126,200		2,555,550
ScanSource, Inc. *			40,578		1,558,601
ShoreTel, Inc. *			83,900		633,445
Silicon Graphics International Corp. *			53,400		645,072
Sonus Networks, Inc. *			309,258		1,011,274
Speed Commerce, Inc. *			57,100		188,430
Super Micro Computer, Inc. *			45,400		924,344
SYNNEX Corp. *			38,600		2,600,868
Tessco Technologies, Inc.			7,400		243,386
TTM Technologies, Inc. *			72,500		572,025
Ubiquiti Networks, Inc. *			20,100		778,473
Uni-Pixel, Inc. *(c)			14,400		78,768
Universal Display Corp. *(c)			62,200		1,620,310
ViaSat, Inc. *			59,119		3,796,031
Viasystems Group, Inc. *			7,000		84,140
Violin Memory, Inc. *(c)			33,700		121,320
Vishay Precision Group, Inc. *			16,500		267,795
Westell Technologies, Inc., Class A *			71,100		231,786
Zygo Corp. *			23,500		452,140
					118,389,876
Telecommunication Services 0.7%
8x8, Inc. *			127,000		1,231,900
Atlantic Tele-Network, Inc.			15,300		905,301
Boingo Wireless, Inc. *			21,700		143,220
Cbeyond, Inc. *			37,400		369,886
Cincinnati Bell, Inc. *			303,745		1,017,546
Cogent Communications Group, Inc.			70,700		2,437,029
Consolidated Communications Holdings, Inc.			62,825		1,251,474
FairPoint Communications, Inc. *			28,900		394,196
General Communication, Inc., Class A *			50,300		525,132
Hawaiian Telcom Holdco, Inc. *			14,100		375,342
HickoryTech Corp.			17,900		212,473
IDT Corp., Class B			23,500		372,240
inContact, Inc. *			76,100		627,825
Inteliquent, Inc.			46,400		632,896
Iridium Communications, Inc. *			91,500		610,305
Lumos Networks Corp.			25,400		335,534
magicJack VocalTec Ltd. *(c)			26,400		466,752
NII Holdings, Inc. *(c)			245,200		210,847
NTELOS Holdings Corp. (c)			26,050		359,230
ORBCOMM, Inc. *			60,900		381,843
Premiere Global Services, Inc. *			70,000		890,400
RingCentral, Inc. *			12,500		189,500
Shenandoah Telecommunications Co.			34,800		975,444
Straight Path Communications, Inc., Class B *			11,750		82,250
Towerstream Corp. *(c)			103,600		191,660
USA Mobility, Inc.			36,500		625,245
Vonage Holdings Corp. *			233,000		894,720
					16,710,190
Transportation 1.8%
Air Transport Services Group, Inc. *			72,100		564,543
Allegiant Travel Co.			22,700		2,666,115
ArcBest Corp.			39,372		1,552,044
Atlas Air Worldwide Holdings, Inc. *			37,400		1,308,626
Celadon Group, Inc.			32,600		750,126
Echo Global Logistics, Inc. *			25,400		496,824
Forward Air Corp.			45,682		2,020,515
Hawaiian Holdings, Inc. *			75,200		1,086,640
Heartland Express, Inc.			67,500		1,468,800
Hub Group, Inc., Class A *			56,092		2,504,508
International Shipholding Corp.			7,300		196,662
JetBlue Airways Corp. *			366,100		2,894,020
Knight Transportation, Inc.			88,400		2,097,732
Marten Transport Ltd.			37,700		884,442
Matson, Inc.			65,600		1,554,064
Park-Ohio Holdings Corp. *			13,800		805,782
Patriot Transportation Holding, Inc. *			8,700		303,456
Quality Distribution, Inc. *			29,300		368,301
Republic Airways Holdings, Inc. *			74,100		615,771
Roadrunner Transportation Systems, Inc. *			29,200		719,196
Saia, Inc. *			35,100		1,445,067
Scorpio Bulkers, Inc. *			197,400		1,766,730
SkyWest, Inc.			73,612		853,899
Spirit Airlines, Inc. *			90,600		5,149,704
Swift Transportation Co. *			124,600		2,996,630
Ultrapetrol Bahamas Ltd. *			33,800		95,654
Universal Truckload Services, Inc.			7,300		180,018
UTi Worldwide, Inc.			136,800		1,339,272
Werner Enterprises, Inc.			68,543		1,754,701
Wesco Aircraft Holdings, Inc. *			64,400		1,304,744
XPO Logistics, Inc. *			76,469		2,075,369
YRC Worldwide, Inc. *(c)			47,200		1,058,696
					44,878,651
Utilities 3.2%
ALLETE, Inc.			63,390		3,281,066
American States Water Co.			59,800		1,815,528
Artesian Resources Corp., Class A			10,500		231,210
Atlantic Power Corp. (c)			168,900		501,633
Avista Corp.			89,512		2,877,811
Black Hills Corp.			66,298		3,828,709
California Water Service Group			71,574		1,610,415
Chesapeake Utilities Corp.			13,800		872,988
Cleco Corp.			90,600		4,761,030
Connecticut Water Service, Inc.			15,000		487,500
Consolidated Water Co., Ltd.			19,500		226,590
Delta Natural Gas Co., Inc.			9,300		177,351
Dynegy, Inc. *			148,200		4,216,290
El Paso Electric Co.			61,516		2,326,535

36 See financial notes

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Genie Energy Ltd., Class B *		18,600		150,660
IDACORP, Inc.		74,800		4,199,272
MGE Energy, Inc.		50,940		1,946,927
Middlesex Water Co.		26,200		532,646
New Jersey Resources Corp.		62,700		3,118,071
Northwest Natural Gas Co.		39,895		1,766,152
NorthWestern Corp.		56,712		2,743,726
NRG Yield, Inc., Class A		35,400		1,516,536
Ormat Technologies, Inc.		27,700		739,036
Otter Tail Corp.		54,909		1,608,834
Pattern Energy Group, Inc.		26,700		715,560
Piedmont Natural Gas Co., Inc.		111,600		3,994,164
PNM Resources, Inc.		118,200		3,271,776
Portland General Electric Co.		113,400		3,795,498
Pure Cycle Corp. *(c)		24,500		137,445
SJW Corp.		24,600		669,858
South Jersey Industries, Inc.		47,860		2,749,557
Southwest Gas Corp.		68,996		3,795,470
The Empire District Electric Co.		62,100		1,510,272
The Laclede Group, Inc.		49,277		2,336,223
UIL Holdings Corp.		84,010		3,085,687
Unitil Corp.		22,100		733,720
UNS Energy Corp.		63,117		3,790,807
WGL Holdings, Inc.		77,600		3,087,704
York Water Co.		17,000		340,170
				79,550,427
Total Common Stock
(Cost $1,658,448,442)				2,422,381,678
Rights 0.0% of net assets
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
Omthera Pharmaceutical CVR *(a)(b)		8,400		—
Telecommunication Services 0.0%
Contra Leap Wireless CVR *(a)(b)		84,700		213,444
Total Rights
(Cost $213,444)				213,444
Warrants 0.0% of net assets
Energy 0.0%
Magnum Hunter Resources Corp. *(a)(b)		24,500		—
Total Warrants
(Cost $—)				—
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 3.3% of net assets
Time Deposits 3.1%
Citibank
0.03%, 05/01/14		3,231,163		3,231,163
DNB
0.03%, 05/01/14		74,674,338		74,674,338
				77,905,501
U.S. Treasury Obligation 0.2%
U.S. Treasury Bill
0.05%, 06/19/14 (d)(e)		4,000,000		3,999,728
Total Short-Term Investments
(Cost $81,905,229)				81,905,229
End of Investments.
	Number		Value
Security	of Shares		($)
Collateral Invested for Securities on Loan 4.9% of net assets
Wells Fargo Advantage Government Money Market Fund, Institutional Class 0.01% (f)		122,988,021		122,988,021
Total Collateral Invested for Securities on Loan
(Cost $122,988,021)				122,988,021
End of Collateral Invested for Securities on Loan.

At 04/30/14 tax basis cost of the fund’s investments was $1,748,601,497 and the unrealized appreciation and depreciation were $874,737,824 and ($118,838,970), respectively, with a net unrealized appreciation of $755,898,854.

*	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 $213,444 or 0.0% of net assets.
(c)	All or a portion of this security is on loan. Securities on loan were valued at $119,586,498.
(d)	All or a portion of this security is held as collateral for open futures contracts.
(e)	The rate shown is the purchase yield.
(f)	The rate shown is the 7-day yield.

CVR —	Contingent Value Rights
REIT —	Real Estate Investment Trust

See financial notes 37

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

In addition to the above, the fund held the following at 04/30/14:

			Contract		Unrealized
	Number of		Value		Depreciation
	Contracts		($)		($)
Futures Contracts
Russell 2000 Index, mini, Long, expires 06/20/14		810		91,011,600		(2,559,487	)

38 See financial notes

 Schwab Total Stock Market Index Fund

Portfolio Holdings as of April 30, 2014 (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		2,186,360,928		3,522,081,897
	0	.0%	Rights		32,982		32,760
	0	.0%	Warrants		—		—
	2	.8%	Short-Term Investments		101,893,219		101,893,219
	99	.8%	Total Investments		2,288,287,129		3,624,007,876
	0	.7%	Collateral Invested for Securities on Loan		26,681,531		26,681,531
	(0	.5%)	Other Assets and Liabilities, Net				(19,603,489	)
	100	.0%	Net Assets				3,631,085,918

	Number		Value
Security	of Shares		($)
Common Stock 97.0% of net assets
Automobiles & Components 1.2%
American Axle & Manufacturing Holdings, Inc. *		13,400		236,510
Autoliv, Inc.		15,800		1,611,284
BorgWarner, Inc.		39,100		2,429,674
Cooper Tire & Rubber Co.		8,900		223,835
Dana Holding Corp.		24,800		525,016
Delphi Automotive plc		46,100		3,081,324
Dorman Products, Inc. *		5,000		287,750
Drew Industries, Inc.		5,400		271,728
Federal-Mogul Holdings Corp. *		12,900		222,138
Ford Motor Co.		665,636		10,750,021
General Motors Co.		220,000		7,585,600
Gentex Corp.		23,700		679,479
Harley-Davidson, Inc.		36,500		2,698,810
Johnson Controls, Inc.		113,100		5,105,334
Lear Corp.		14,000		1,162,840
Modine Manufacturing Co. *		12,100		199,408
Standard Motor Products, Inc.		7,500		284,925
Stoneridge, Inc. *		13,100		140,039
Strattec Security Corp.		1,500		100,215
Tenneco, Inc. *		10,080		603,490
Tesla Motors, Inc. *		13,600		2,827,304
The Goodyear Tire & Rubber Co.		40,500		1,020,600
Thor Industries, Inc.		7,500		456,525
TRW Automotive Holdings Corp. *		20,400		1,639,140
Visteon Corp. *		8,000		694,480
Winnebago Industries, Inc. *		7,400		176,860
				45,014,329
Banks 5.8%
1st Source Corp.		5,528		163,021
Ameris Bancorp *		6,348		135,022
Arrow Financial Corp.		3,390		84,852
Associated Banc-Corp.		25,000		438,750
Astoria Financial Corp.		19,300		255,918
BancFirst Corp.		2,300		133,883
BancorpSouth, Inc.		16,112		376,376
Bank Mutual Corp.		18,268		109,973
Bank of America Corp.		1,783,756		27,006,066
Bank of Hawaii Corp.		6,500		358,605
Bank of the Ozarks, Inc.		5,600		335,440
BankUnited, Inc.		14,800		488,252
Banner Corp.		5,571		220,277
BB&T Corp.		120,258		4,489,231
BBCN Bancorp, Inc.		19,100		294,331
Beneficial Mutual Bancorp, Inc. *		9,000		117,360
Berkshire Hills Bancorp, Inc.		8,000		187,440
BOK Financial Corp.		3,740		244,671
Boston Private Financial Holdings, Inc.		20,729		259,320
Brookline Bancorp, Inc.		11,705		106,281
Bryn Mawr Bank Corp.		3,400		92,752
Camden National Corp.		2,500		95,425
Capital Bank Financial Corp., Class A *		10,300		245,655
Capital City Bank Group, Inc.		6,875		95,562
Capitol Federal Financial, Inc.		21,963		264,435
Cardinal Financial Corp.		3,700		62,160
Cathay General Bancorp		9,200		217,120
Central Pacific Financial Corp.		10,269		192,749
Century Bancorp, Inc., Class A		800		26,800
Chemical Financial Corp.		8,683		243,732
CIT Group, Inc.		33,100		1,424,955
Citigroup, Inc.		512,528		24,555,216
City Holding Co.		4,800		206,352
City National Corp.		7,800		566,046
Columbia Banking System, Inc.		9,951		246,984
Comerica, Inc.		31,159		1,503,110
Commerce Bancshares, Inc.		12,933		562,327
Community Bank System, Inc.		6,400		238,016
Community Trust Bancorp, Inc.		2,487		91,696
Cullen/Frost Bankers, Inc.		9,100		695,331
CVB Financial Corp.		19,411		280,683
Dime Community Bancshares, Inc.		6,875		112,062
Eagle Bancorp, Inc. *		5,760		192,326
East West Bancorp, Inc.		24,100		831,691
EverBank Financial Corp.		15,400		288,288
F.N.B. Corp.		31,061		386,399
Fifth Third Bancorp		145,814		3,005,227
First BanCorp *		26,579		136,616
First Busey Corp.		20,200		111,100
First Citizens BancShares, Inc., Class A		900		202,401
First Commonwealth Financial Corp.		24,904		213,925
First Financial Bancorp		10,339		167,388
First Financial Bankshares, Inc.		4,100		242,105
First Financial Corp.		2,600		83,226
First Financial Holdings, Inc.		5,584		320,912
First Horizon National Corp.		45,216		519,532

See financial notes 39

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
First Interstate Bancsystem, Inc.		8,900		221,521
First Merchants Corp.		9,041		191,850
First Midwest Bancorp, Inc.		15,825		259,055
First Niagara Financial Group, Inc.		58,465		521,508
First Republic Bank		19,600		994,896
First United Corp. *		2,200		18,172
FirstMerit Corp.		27,289		529,134
Flagstar Bancorp, Inc. *		8,060		141,856
Flushing Financial Corp.		6,800		130,696
Fulton Financial Corp.		28,262		344,514
Glacier Bancorp, Inc.		10,497		269,353
Great Southern Bancorp, Inc.		3,400		97,478
Hancock Holding Co.		12,344		416,363
Hawthorn Bancshares, Inc.		911		12,080
Heartland Financial USA, Inc.		2,500		60,750
Heritage Financial Corp.		6,135		99,142
Home BancShares, Inc.		11,500		364,665
Home Loan Servicing Solutions Ltd.		10,400		230,360
Hudson City Bancorp, Inc.		78,531		782,169
Huntington Bancshares, Inc.		137,099		1,255,827
Iberiabank Corp.		6,075		382,117
Independent Bank Corp.		5,700		211,584
Independent Bank Corp., Michigan		431		5,612
International Bancshares Corp.		7,784		178,721
Investors Bancorp, Inc.		14,705		393,065
JPMorgan Chase & Co.		639,144		35,779,281
Kearny Financial Corp. *		9,000		131,220
KeyCorp		148,290		2,022,676
Lakeland Financial Corp.		3,700		135,420
M&T Bank Corp.		21,549		2,629,193
MainSource Financial Group, Inc.		5,535		91,494
MB Financial, Inc.		8,133		218,290
Merchants Bancshares, Inc.		3,650		106,105
MGIC Investment Corp. *		62,600		538,360
MutualFirst Financial, Inc.		2,000		37,600
National Bank Holdings Corp., Class A		12,800		245,248
National Penn Bancshares, Inc.		17,675		172,685
Nationstar Mortgage Holdings, Inc. *(c)		5,500		180,015
NBT Bancorp, Inc.		11,500		260,475
New York Community Bancorp, Inc.		74,285		1,144,732
North Valley Bancorp *		300		6,780
Northfield Bancorp, Inc.		15,765		204,472
Northrim BanCorp, Inc.		4,281		102,701
Northwest Bancshares, Inc.		19,350		257,161
OceanFirst Financial Corp.		7,150		115,973
Ocwen Financial Corp. *		18,620		705,698
OFG Bancorp		8,163		139,261
Old National Bancorp		16,800		237,216
Oritani Financial Corp.		6,000		88,980
PacWest Bancorp		15,333		603,660
Park National Corp.		2,845		206,319
People’s United Financial, Inc.		49,587		708,102
Peoples Financial Corp. *		3,000		40,515
Pinnacle Financial Partners, Inc.		6,475		223,841
Popular, Inc. *		19,720		609,348
Premier Financial Bancorp, Inc.		2,645		37,824
PrivateBancorp, Inc.		13,000		358,410
Prosperity Bancshares, Inc.		8,800		519,200
Provident Financial Holdings, Inc.		4,350		61,204
Provident Financial Services, Inc.		14,017		243,615
Radian Group, Inc.		24,500		342,510
Regions Financial Corp.		227,462		2,306,465
Renasant Corp.		8,910		242,530
Republic Bancorp, Inc., Class A		6,521		156,569
S&T Bancorp, Inc.		4,400		102,344
Sandy Spring Bancorp, Inc.		5,900		141,895
Seacoast Banking Corp of Florida *		3,936		41,722
Shore Bancshares, Inc. *		1,250		11,863
Signature Bank *		8,200		974,324
Simmons First National Corp., Class A		4,000		144,640
Southside Bancshares, Inc.		4,741		130,750
Southwest Bancorp, Inc.		7,800		130,260
State Bank Financial Corp.		6,200		102,796
Sterling Bancorp		19,185		229,453
Stock Yards Bancorp, Inc.		3,670		108,192
Suffolk Bancorp *		4,600		100,878
Sun Bancorp, Inc. *		19,318		73,408
SunTrust Banks, Inc.		87,642		3,353,183
Susquehanna Bancshares, Inc.		27,568		285,604
SVB Financial Group *		8,000		853,520
Synovus Financial Corp.		154,300		495,303
Taylor Capital Group, Inc. *		8,900		189,481
TCF Financial Corp.		32,100		503,970
Texas Capital Bancshares, Inc. *		7,800		438,282
TFS Financial Corp. *		19,500		261,105
The First of Long Island Corp.		4,000		145,080
The PNC Financial Services Group, Inc.		90,132		7,574,693
Timberland Bancorp, Inc.		2,000		21,300
Tompkins Financial Corp.		4,024		189,691
TowneBank		3,800		58,634
Tree.com, Inc. *		4,444		129,232
Trico Bancshares		5,400		130,950
TrustCo Bank Corp.		20,657		136,543
Trustmark Corp.		8,562		195,813
U.S. Bancorp		307,631		12,545,192
UMB Financial Corp.		5,274		309,637
Umpqua Holdings Corp.		31,951		531,345
Union Bankshares Corp.		12,893		329,932
United Bankshares, Inc.		12,300		359,775
United Community Banks, Inc. *		11,678		188,600
Valley National Bancorp		30,542		306,031
ViewPoint Financial Group, Inc.		8,700		226,809
Walker & Dunlop, Inc. *		9,700		152,096
Washington Federal, Inc.		14,942		322,448
Washington Trust Bancorp, Inc.		3,600		123,120
Webster Financial Corp.		15,963		481,125
Wells Fargo & Co.		808,206		40,119,346
WesBanco, Inc.		7,756		234,541
Westamerica Bancorp		5,200		264,264
Western Alliance Bancorp *		16,600		382,962
Wilshire Bancorp, Inc.		9,900		99,000
Wintrust Financial Corp.		8,900		398,898
WSFS Financial Corp.		2,000		135,240
Zions Bancorp		30,525		882,783
				210,497,062

40 See financial notes

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Capital Goods 8.2%
3M Co.		105,600		14,687,904
A.O. Smith Corp.		11,800		551,768
AAON, Inc.		6,853		194,283
AAR Corp.		8,400		217,560
Aceto Corp.		7,900		172,852
Actuant Corp., Class A		10,280		348,081
Acuity Brands, Inc.		7,500		934,275
AECOM Technology Corp. *		16,100		521,962
Aegion Corp. *		4,300		109,607
Aerovironment, Inc. *		4,200		141,834
AGCO Corp.		15,462		861,233
Air Lease Corp.		13,100		469,897
Aircastle Ltd.		14,100		247,737
Alamo Group, Inc.		2,500		132,800
Albany International Corp., Class A		6,718		241,714
Allegion plc		14,433		712,269
Alliant Techsystems, Inc.		5,537		798,546
Allison Transmission Holdings, Inc.		16,500		492,360
Altra Industrial Motion Corp.		4,300		146,888
American Railcar Industries, Inc.		2,400		166,656
American Science & Engineering, Inc.		2,000		134,400
American Superconductor Corp. *(c)		5,200		6,656
American Woodmark Corp. *		4,000		120,040
AMETEK, Inc.		40,425		2,131,206
Apogee Enterprises, Inc.		6,600		209,682
Applied Industrial Technologies, Inc.		6,525		312,678
Armstrong World Industries, Inc. *		5,500		289,080
Astec Industries, Inc.		5,700		227,715
Astronics Corp. *		2,125		121,380
AZZ, Inc.		5,700		247,494
B/E Aerospace, Inc. *		16,300		1,430,651
Barnes Group, Inc.		6,600		254,232
Beacon Roofing Supply, Inc. *		6,600		234,828
Blount International, Inc. *		15,900		177,603
Breeze-Eastern Corp. *		500		4,950
Briggs & Stratton Corp.		11,400		243,618
Builders FirstSource, Inc. *		17,100		134,235
Carlisle Cos., Inc.		10,500		863,625
Caterpillar, Inc.		107,700		11,351,580
Chart Industries, Inc. *		4,400		300,168
Chicago Bridge & Iron Co., N.V.		17,800		1,425,246
CIRCOR International, Inc.		3,750		304,538
CLARCOR, Inc.		7,300		421,648
Colfax Corp. *		16,400		1,180,472
Columbus McKinnon Corp. *		4,300		113,907
Comfort Systems USA, Inc.		7,700		115,500
Crane Co.		8,000		581,840
Cubic Corp.		4,500		213,435
Cummins, Inc.		29,500		4,450,075
Curtiss-Wright Corp.		9,100		581,854
Danaher Corp.		101,400		7,440,732
Deere & Co.		63,200		5,899,088
DigitalGlobe, Inc. *		12,322		366,949
Donaldson Co., Inc.		22,100		930,189
Dover Corp.		27,800		2,401,920
Ducommun, Inc. *		3,200		77,664
DXP Enterprises, Inc. *		1,700		192,457
Dycom Industries, Inc. *		5,300		166,420
Eaton Corp. plc		80,477		5,845,849
EMCOR Group, Inc.		12,700		584,073
Emerson Electric Co.		118,700		8,092,966
Encore Wire Corp.		4,600		224,158
EnerSys, Inc.		7,500		506,850
Engility Holdings, Inc. *		4,116		179,622
EnPro Industries, Inc. *		4,900		348,929
ESCO Technologies, Inc.		3,900		130,338
Esterline Technologies Corp. *		5,900		643,218
Exelis, Inc.		34,900		647,046
Fastenal Co.		45,100		2,258,608
Federal Signal Corp. *		12,800		194,304
Flowserve Corp.		23,300		1,702,065
Fluor Corp.		26,400		1,998,480
Fortune Brands Home & Security, Inc.		27,400		1,091,890
Foster Wheeler AG *		15,200		521,056
Franklin Electric Co., Inc.		5,600		216,552
FreightCar America, Inc.		2,500		65,650
FuelCell Energy, Inc. *(c)		29,400		66,738
Furmanite Corp. *		7,200		75,456
GATX Corp.		8,900		584,107
GenCorp, Inc. *		11,600		203,696
Generac Holdings, Inc.		12,500		736,000
General Cable Corp.		6,700		171,654
General Dynamics Corp.		55,200		6,041,640
General Electric Co.		1,693,466		45,537,301
Gibraltar Industries, Inc. *		6,300		107,604
Graco, Inc.		10,812		783,870
GrafTech International Ltd. *		16,600		186,086
Granite Construction, Inc.		8,150		304,647
Great Lakes Dredge & Dock Corp. *		11,600		100,108
Griffon Corp.		15,100		160,664
H&E Equipment Services, Inc. *		6,800		262,140
Hardinge, Inc.		4,800		64,128
Harsco Corp.		11,300		270,409
HD Supply Holdings, Inc. *		8,300		213,974
HEICO Corp.		8,375		463,305
Hexcel Corp. *		16,400		683,716
Honeywell International, Inc.		132,362		12,296,430
Hubbell, Inc., Class B		9,300		1,094,796
Huntington Ingalls Industries, Inc.		8,172		841,716
Hyster-Yale Materials Handling, Inc.		2,300		221,697
IDEX Corp.		13,925		1,038,387
Illinois Tool Works, Inc.		66,800		5,693,364
Ingersoll-Rand plc		43,300		2,589,340
Integrated Electrical Services, Inc. *		5,105		31,702
ITT Corp.		15,000		647,100
Jacobs Engineering Group, Inc. *		21,700		1,252,090
John Bean Technologies Corp.		4,983		144,457
Joy Global, Inc.		17,550		1,059,669
Kadant, Inc.		3,001		104,285
Kaman Corp.		5,700		239,229
KBR, Inc.		24,000		608,880
Kennametal, Inc.		14,700		686,931
Kratos Defense & Security Solutions, Inc. *		10,180		73,500
L-3 Communications Holdings, Inc.		14,600		1,684,402

See financial notes 41

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
L.B. Foster Co., Class A		1,400		66,290
Lawson Products, Inc. *		5,500		92,125
Layne Christensen Co. *		4,500		78,390
Lennox International, Inc.		7,471		626,294
Lincoln Electric Holdings, Inc.		13,600		908,616
Lindsay Corp. (c)		3,100		273,203
Lockheed Martin Corp.		45,552		7,476,905
Lydall, Inc. *		5,500		128,755
Magnetek, Inc. *		1,650		36,383
Masco Corp.		60,300		1,211,427
MasTec, Inc. *		8,550		338,409
Meritor, Inc. *		22,600		268,262
Moog, Inc., Class A *		7,587		496,569
MRC Global, Inc. *		15,600		455,364
MSC Industrial Direct Co., Inc., Class A		8,000		728,480
Mueller Industries, Inc.		11,800		341,492
Mueller Water Products, Inc., Class A		23,139		211,028
MYR Group, Inc. *		8,500		199,410
National Presto Industries, Inc. (c)		2,900		209,554
Navistar International Corp. *		11,600		439,988
NCI Building Systems, Inc. *		14,480		226,467
NN, Inc.		1,800		35,226
Nordson Corp.		9,500		706,325
Nortek, Inc. *		3,200		262,912
Northrop Grumman Corp.		36,332		4,414,701
Omega Flex, Inc.		700		14,119
Orbital Sciences Corp. *		12,600		370,440
Oshkosh Corp.		14,300		793,793
Owens Corning		18,700		763,895
PACCAR, Inc.		58,425		3,738,031
Pall Corp.		18,500		1,556,775
Parker Hannifin Corp.		25,700		3,260,816
Pentair Ltd.		32,728		2,431,363
Polypore International, Inc. *(c)		6,100		211,548
Powell Industries, Inc.		2,800		177,296
Precision Castparts Corp.		24,602		6,226,520
Preformed Line Products Co.		1,000		59,760
Primoris Services Corp.		6,900		193,062
Proto Labs, Inc. *		2,800		169,512
Quanex Building Products Corp.		6,125		115,395
Quanta Services, Inc. *		36,171		1,276,113
Raven Industries, Inc.		5,600		173,040
Raytheon Co.		52,800		5,041,344
RBC Bearings, Inc. *		3,000		186,780
Regal-Beloit Corp.		8,700		650,151
Rexnord Corp. *		9,300		248,682
Rockwell Automation, Inc.		22,900		2,729,222
Rockwell Collins, Inc.		22,300		1,731,595
Roper Industries, Inc.		16,400		2,278,780
Rush Enterprises, Inc., Class A *		8,200		263,220
Sensata Technologies Holding N.V. *		23,900		1,015,033
Simpson Manufacturing Co., Inc.		6,200		203,298
Snap-on, Inc.		9,200		1,067,200
SolarCity Corp. *(c)		9,100		484,575
Spirit AeroSystems Holdings, Inc., Class A *		18,600		558,558
SPX Corp.		7,110		724,082
Standex International Corp.		3,000		178,110
Stanley Black & Decker, Inc.		25,652		2,203,250
Sun Hydraulics Corp.		5,600		228,928
TAL International Group, Inc. *		6,000		253,080
Taser International, Inc. *		11,800		190,570
Tecumseh Products Co., Class A *		9,100		54,691
Teledyne Technologies, Inc. *		6,757		627,455
Tennant Co.		4,200		267,918
Terex Corp.		18,400		796,536
Textainer Group Holdings Ltd. (c)		5,200		204,360
Textron, Inc.		49,500		2,024,550
The Babcock & Wilcox Co.		17,400		605,346
The Boeing Co.		115,500		14,901,810
The Gorman-Rupp Co.		5,141		159,628
The Greenbrier Cos., Inc. *		5,800		304,152
The KEYW Holding Corp. *		8,400		107,940
The Manitowoc Co., Inc.		23,200		737,296
The Middleby Corp. *		3,100		782,688
The Timken Co.		13,100		826,348
The Toro Co.		10,600		673,524
Thermon Group Holdings, Inc. *		9,500		226,290
Titan International, Inc.		6,925		121,257
Titan Machinery, Inc. *		3,600		63,504
TransDigm Group, Inc.		8,400		1,494,108
Trex Co., Inc. *		2,700		212,004
TriMas Corp. *		4,700		168,542
Trinity Industries, Inc.		14,150		1,062,099
Triumph Group, Inc.		8,100		524,961
Tutor Perini Corp. *		7,100		210,160
United Rentals, Inc. *		16,400		1,538,812
United Technologies Corp.		142,168		16,822,739
Universal Forest Products, Inc.		4,600		232,254
URS Corp.		10,700		504,184
USG Corp. *		16,900		504,634
Valmont Industries, Inc.		4,300		640,313
Vicor Corp. *		9,900		82,764
W.W. Grainger, Inc.		10,200		2,594,880
Wabash National Corp. *		11,200		149,632
WABCO Holdings, Inc. *		10,233		1,095,033
Wabtec Corp.		15,756		1,174,610
Watsco, Inc.		4,200		432,222
Watts Water Technologies, Inc., Class A		4,000		212,800
WESCO International, Inc. *		8,100		711,018
Woodward, Inc.		10,500		470,715
Xylem, Inc.		30,500		1,146,495
				297,857,636
Commercial & Professional Supplies 1.0%
ABM Industries, Inc.		7,200		195,048
Acacia Research Corp. (c)		15,600		250,224
ACCO Brands Corp. *		15,378		94,267
AMREP Corp. *		2,500		13,625
ARC Document Solutions, Inc. *		7,000		44,800
Brady Corp., Class A		6,400		165,056
Casella Waste Systems, Inc., Class A *		13,300		67,830
CDI Corp.		5,500		84,260
Cenveo, Inc. *		7,300		22,557
Cintas Corp.		16,650		981,184
Clean Harbors, Inc. *		9,100		546,000
Compx International, Inc.		2,000		18,400
Copart, Inc. *		17,618		639,005

42 See financial notes

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Covanta Holding Corp.		18,900		348,705
CRA International, Inc. *		4,200		91,434
Deluxe Corp.		7,600		417,620
Ennis, Inc.		6,500		97,240
Equifax, Inc.		19,795		1,401,684
Exponent, Inc.		3,300		232,386
FTI Consulting, Inc. *		5,700		195,510
G&K Services, Inc., Class A		4,100		217,054
GP Strategies Corp. *		1,500		39,420
Healthcare Services Group, Inc.		12,656		368,290
Heidrick & Struggles International, Inc.		5,000		94,250
Herman Miller, Inc.		8,700		268,221
HNI Corp.		6,400		225,472
Hudson Global, Inc. *		3,220		11,431
Huron Consulting Group, Inc. *		5,000		356,000
ICF International, Inc. *		6,500		253,305
IHS, Inc., Class A *		11,000		1,326,930
InnerWorkings, Inc. *		7,400		53,280
Insperity, Inc.		6,800		218,008
Interface, Inc.		8,400		151,116
Iron Mountain, Inc.		28,138		800,245
KAR Auction Services, Inc.		22,500		670,050
Kelly Services, Inc., Class A		5,700		120,042
Kforce, Inc.		7,105		164,268
Kimball International, Inc., Class B		9,100		152,516
Knoll, Inc.		7,000		127,330
Korn/Ferry International *		6,600		191,730
Manpowergroup, Inc.		12,591		1,024,152
Mastech Holdings, Inc.		675		11,664
McGrath RentCorp		4,600		145,268
Mistras Group, Inc. *		4,000		90,840
Mobile Mini, Inc.		6,200		273,916
MSA Safety, Inc.		4,700		247,925
Multi-Color Corp.		4,625		161,181
Navigant Consulting, Inc. *		14,000		235,200
Nielsen Holdings N.V.		44,400		2,084,580
NL Industries, Inc.		7,800		78,234
On Assignment, Inc. *		6,500		227,500
Performant Financial Corp. *		7,700		67,067
Pitney Bowes, Inc.		35,500		951,400
Quad Graphics, Inc.		9,800		212,170
R.R. Donnelley & Sons Co.		36,638		644,829
Republic Services, Inc.		47,845		1,678,881
Resources Connection, Inc.		11,300		153,793
Robert Half International, Inc.		22,900		1,025,920
Rollins, Inc.		9,218		277,277
RPX Corp. *		10,300		168,714
Steelcase, Inc., Class A		11,500		189,520
Stericycle, Inc. *		14,200		1,653,448
Team, Inc. *		3,000		128,670
Tetra Tech, Inc. *		13,131		376,466
The ADT Corp. (c)		33,866		1,024,108
The Advisory Board Co. *		6,800		389,368
The Brink’s Co.		7,100		180,624
The Corporate Executive Board Co.		5,500		379,610
The Dun & Bradstreet Corp.		5,840		646,838
The Standard Register Co. *		820		5,953
Towers Watson & Co., Class A		10,700		1,200,754
TRC Cos., Inc. *		3,350		19,866
TrueBlue, Inc. *		10,100		270,175
Tyco International Ltd.		76,833		3,142,470
UniFirst Corp.		2,100		202,104
United Stationers, Inc.		5,800		217,674
Verisk Analytics, Inc., Class A *		24,700		1,484,223
Viad Corp.		3,625		83,556
Virco Mfg. Corp. *		1,170		2,568
WageWorks, Inc. *		5,000		211,850
Waste Connections, Inc.		21,412		956,260
Waste Management, Inc.		72,100		3,204,845
				37,447,254
Consumer Durables & Apparel 1.5%
Arctic Cat, Inc.		2,400		98,136
Blyth, Inc. (c)		7,400		69,338
Brunswick Corp.		14,400		578,736
Callaway Golf Co.		12,800		111,488
Carter’s, Inc.		9,400		692,404
Cavco Industries, Inc. *		1,610		125,499
Coach, Inc.		46,308		2,067,652
Columbia Sportswear Co.		3,450		296,631
Crocs, Inc. *		15,000		226,950
CSS Industries, Inc.		4,800		115,056
D.R. Horton, Inc.		46,904		1,045,021
Deckers Outdoor Corp. *		5,200		410,540
Ethan Allen Interiors, Inc.		10,200		247,656
Flexsteel Industries, Inc.		1,900		65,208
Foamex International, Inc. *(b)(g)		2,278		—
Fossil Group, Inc. *		7,662		817,152
G-III Apparel Group Ltd. *		2,800		200,956
Garmin Ltd. (c)		19,800		1,130,580
Hanesbrands, Inc.		17,547		1,440,433
Harman International Industries, Inc.		11,200		1,227,632
Hasbro, Inc.		18,800		1,038,888
Helen of Troy Ltd. *		5,000		313,500
Hovnanian Enterprises, Inc., Class A *(c)		50,500		225,230
Iconix Brand Group, Inc. *		9,600		408,000
iRobot Corp. *		7,300		244,550
JAKKS Pacific, Inc.		7,500		65,700
Jarden Corp. *		19,738		1,128,027
Kate Spade & Co. *		20,600		716,262
KB Home		10,900		179,959
La-Z-Boy, Inc.		7,500		181,725
LeapFrog Enterprises, Inc. *		9,000		61,650
Leggett & Platt, Inc.		23,300		765,638
Lennar Corp., Class A		31,290		1,207,481
Lululemon Athletica, Inc. *(c)		16,600		762,438
M.D.C. Holdings, Inc.		9,003		248,483
M/I Homes, Inc. *		3,000		66,810
Marine Products Corp.		405		2,876
Mattel, Inc.		59,000		2,313,685
Meritage Homes Corp. *		5,900		227,622
Michael Kors Holdings Ltd. *		30,800		2,808,960
Mohawk Industries, Inc. *		10,019		1,326,616
Movado Group, Inc.		5,800		227,824
NACCO Industries, Inc., Class A		1,900		101,821
Nautilus, Inc. *		9,825		81,842
Newell Rubbermaid, Inc.		47,900		1,442,269
NIKE, Inc., Class B		125,500		9,155,225
NVR, Inc. *		700		753,900

See financial notes 43

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Oxford Industries, Inc.		2,500		165,025
Perry Ellis International, Inc. *		5,500		83,050
Polaris Industries, Inc.		10,600		1,423,898
PulteGroup, Inc.		56,976		1,047,789
PVH Corp.		14,411		1,809,589
Quiksilver, Inc. *		25,900		166,278
Ralph Lauren Corp.		9,800		1,483,426
Skechers U.S.A., Inc., Class A *		6,500		266,435
Skyline Corp. *		2,600		13,260
Smith & Wesson Holding Corp. *(c)		12,400		190,340
Standard Pacific Corp. *		28,500		227,715
Stanley Furniture Co., Inc. *		6,875		20,075
Steven Madden Ltd. *		9,112		324,478
Sturm, Ruger & Co., Inc. (c)		2,700		173,745
Superior Uniform Group, Inc.		1,600		26,016
Tempur Sealy International, Inc. *		10,300		516,854
The Ryland Group, Inc.		6,700		257,213
Toll Brothers, Inc. *		26,200		897,088
Tumi Holdings, Inc. *		9,200		187,864
Tupperware Brands Corp.		7,800		662,298
Under Armour, Inc., Class A *		27,800		1,359,142
Universal Electronics, Inc. *		5,200		194,220
Vera Bradley, Inc. *(c)		11,000		311,300
VF Corp.		60,700		3,708,163
Whirlpool Corp.		12,949		1,986,118
Wolverine World Wide, Inc.		15,600		438,360
				54,963,788
Consumer Services 2.1%
Ambassadors Group, Inc. *		3,400		14,416
American Public Education, Inc. *		5,600		193,760
Apollo Education Group, Inc. *		16,450		474,747
ARAMARK Holdings Corp.		12,000		338,280
Ascent Capital Group, Inc., Class A *		3,116		214,287
Bally Technologies, Inc. *		5,900		384,149
Biglari Holdings, Inc. *		279		119,697
BJ’s Restaurants, Inc. *		7,300		208,415
Bloomin’ Brands, Inc. *		10,300		219,596
Bob Evans Farms, Inc.		4,200		196,854
Boyd Gaming Corp. *		21,300		251,766
Bridgepoint Education, Inc. *		13,700		217,145
Brinker International, Inc.		12,650		621,621
Buffalo Wild Wings, Inc. *		3,000		438,360
Burger King Worldwide, Inc.		12,200		318,786
Career Education Corp. *		25,114		181,323
Carnival Corp.		72,300		2,842,113
Chipotle Mexican Grill, Inc. *		5,300		2,642,050
Choice Hotels International, Inc.		5,200		229,736
Churchill Downs, Inc.		2,900		254,707
Corinthian Colleges, Inc. *(c)		21,700		24,955
Cracker Barrel Old Country Store, Inc.		3,446		326,474
Darden Restaurants, Inc.		21,500		1,068,765
Denny’s Corp. *		21,100		142,214
DeVry Education Group, Inc.		9,400		423,282
DineEquity, Inc.		3,000		227,430
Domino’s Pizza, Inc.		9,200		684,296
Dover Downs Gaming & Entertainment, Inc. *		5,899		8,554
Dover Motorsports, Inc.		1,400		3,276
Dunkin’ Brands Group, Inc.		16,800		764,568
Education Management Corp. *(c)		19,600		77,812
Graham Holdings Co., Class B		700		469,861
Grand Canyon Education, Inc. *		8,500		366,520
H&R Block, Inc.		46,200		1,313,004
Hillenbrand, Inc.		8,800		267,520
Hilton Worldwide Holdings, Inc. *		15,000		327,450
Hyatt Hotels Corp., Class A *		9,600		540,288
International Game Technology		38,100		478,155
International Speedway Corp., Class A		6,445		202,631
Interval Leisure Group, Inc.		10,769		277,517
Isle of Capri Casinos, Inc. *		11,800		80,240
ITT Educational Services, Inc. *(c)		5,600		151,200
Jack in the Box, Inc. *		7,000		374,780
K12, Inc. *		12,100		286,528
Krispy Kreme Doughnuts, Inc. *		14,100		247,314
Lakes Entertainment, Inc. *		6,800		33,660
Las Vegas Sands Corp.		65,800		5,206,754
Learning Tree International, Inc. *		1,400		4,270
Life Time Fitness, Inc. *		5,500		264,000
LifeLock, Inc. *		11,000		172,700
Luby’s, Inc. *		6,900		37,398
Marriott International, Inc., Class A		36,708		2,126,495
Marriott Vacations Worldwide Corp. *		4,080		222,278
Matthews International Corp., Class A		5,300		213,855
McDonald’s Corp.		167,109		16,941,510
MGM Resorts International *		58,100		1,465,863
Monarch Casino & Resort, Inc. *		8,000		128,320
MTR Gaming Group, Inc. *		5,800		29,348
Multimedia Games Holding Co., Inc. *		5,500		160,600
Norwegian Cruise Line Holdings Ltd. *		16,200		530,874
Orient-Express Hotels Ltd., Class A *		12,600		165,060
Panera Bread Co., Class A *		4,200		642,474
Papa John’s International, Inc.		6,800		298,248
Penn National Gaming, Inc. *		17,000		189,720
Pinnacle Entertainment, Inc. *		9,800		228,046
Popeyes Louisiana Kitchen, Inc. *		6,600		251,460
Regis Corp.		17,300		227,322
Royal Caribbean Cruises Ltd.		27,500		1,461,075
Ruby Tuesday, Inc. *		13,200		101,772
Scientific Games Corp., Class A *		10,900		130,582
SeaWorld Entertainment, Inc.		7,300		219,438
Service Corp. International		35,000		656,950
Six Flags Entertainment Corp.		15,600		626,184
Sonic Corp. *		12,868		245,007
Sotheby’s		11,338		476,876
Speedway Motorsports, Inc.		6,700		121,873
Starbucks Corp.		127,600		9,011,112
Starwood Hotels & Resorts Worldwide, Inc.		33,230		2,547,080
Steiner Leisure Ltd. *		3,000		129,510
Strayer Education, Inc. *		4,300		183,309
Texas Roadhouse, Inc.		8,300		205,342
The Cheesecake Factory, Inc.		7,087		318,135
The Wendy’s Co.		50,775		421,940

44 See financial notes

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Vail Resorts, Inc.		5,300		366,919
Weight Watchers International, Inc. (c)		6,500		128,700
Wyndham Worldwide Corp.		20,944		1,494,145
Wynn Resorts Ltd.		14,000		2,854,460
Yum! Brands, Inc.		75,500		5,812,745
				76,549,851
Diversified Financials 4.4%
Affiliated Managers Group, Inc. *		8,700		1,724,340
American Express Co.		154,250		13,486,077
Ameriprise Financial, Inc.		32,130		3,586,672
Artisan Partners Asset Management, Inc., Class A		5,500		319,385
Asta Funding, Inc. *		6,000		49,020
Atlanticus Holdings Corp. *		4,629		11,248
Berkshire Hathaway, Inc., Class B *		303,874		39,154,165
BGC Partners, Inc., Class A		28,300		202,911
BlackRock, Inc.		21,000		6,321,000
Calamos Asset Management, Inc., Class A		5,000		60,900
Capital One Financial Corp.		96,710		7,146,869
Cash America International, Inc.		6,900		300,495
CBOE Holdings, Inc.		14,200		757,712
CME Group, Inc.		54,050		3,804,580
Cohen & Steers, Inc. (c)		5,400		218,754
Cowen Group, Inc., Class A *		11,889		48,864
Credit Acceptance Corp. *		2,100		276,192
DFC Global Corp. *		9,750		90,870
Discover Financial Services		78,250		4,374,175
E*TRADE Financial Corp. *		46,333		1,040,176
Eaton Vance Corp.		22,700		818,789
Encore Capital Group, Inc. *		5,600		242,032
Evercore Partners, Inc., Class A		6,500		347,295
Ezcorp, Inc., Class A *		20,600		214,858
FBR & Co. *		1,000		25,800
Federated Investors, Inc., Class B		14,650		418,111
Financial Engines, Inc.		7,800		345,150
First Cash Financial Services, Inc. *		3,800		185,326
Franklin Resources, Inc.		69,300		3,627,855
GAMCO Investors, Inc., Class A		3,400		258,162
GFI Group, Inc.		18,700		69,564
Greenhill & Co., Inc.		4,500		225,675
HFF, Inc., Class A		9,800		333,200
ICG Group, Inc. *		8,050		164,059
Interactive Brokers Group, Inc., Class A		7,600		181,640
IntercontinentalExchange Group, Inc.		19,786		4,045,050
INTL FCStone, Inc. *		4,437		83,948
Invesco Ltd.		73,200		2,577,372
Investment Technology Group, Inc. *		8,050		166,152
Janus Capital Group, Inc.		26,200		317,806
KCG Holdings, Inc., Class A *		15,533		154,553
Legg Mason, Inc.		17,550		822,920
Leucadia National Corp.		51,750		1,320,660
LPL Financial Holdings, Inc.		12,800		606,080
MarketAxess Holdings, Inc.		5,300		285,564
McGraw Hill Financial, Inc.		44,900		3,319,457
MicroFinancial, Inc.		1,900		14,953
Moody’s Corp.		31,300		2,457,050
Morgan Stanley		236,800		7,324,224
MSCI, Inc. *		20,000		810,800
Nelnet, Inc., Class A		6,400		270,464
NewStar Financial, Inc. *		13,500		154,170
Northern Trust Corp.		37,100		2,235,275
PHH Corp. *		7,186		170,811
PICO Holdings, Inc. *		3,700		86,025
Piper Jaffray Cos. *		3,950		173,247
Portfolio Recovery Associates, Inc. *		7,200		411,480
Raymond James Financial, Inc.		21,050		1,046,185
Resource America, Inc., Class A		4,000		34,040
Santander Consumer USA Holdings, Inc. *		12,900		293,346
SEI Investments Co.		22,800		738,264
SLM Corp.		72,000		1,854,000
State Street Corp.		72,483		4,679,502
Stifel Financial Corp. *		11,785		551,184
SWS Group, Inc. *		8,211		60,844
T. Rowe Price Group, Inc.		45,000		3,695,850
TD Ameritrade Holding Corp.		39,100		1,247,290
The Bank of New York Mellon Corp.		189,634		6,422,904
The Charles Schwab Corp. (a)		197,326		5,239,005
The First Marblehead Corp. *		750		3,945
The Goldman Sachs Group, Inc.		71,100		11,363,202
The NASDAQ OMX Group, Inc.		19,100		704,790
Virtus Investment Partners, Inc. *		875		161,866
Voya Financial, Inc.		17,700		626,403
Waddell & Reed Financial, Inc., Class A		14,750		994,888
Walter Investment Management Corp. *(c)		5,325		141,539
Westwood Holdings Group, Inc.		1,785		103,833
WisdomTree Investments, Inc. *		20,500		231,445
World Acceptance Corp. *(c)		3,000		217,800
				158,652,107
Energy 9.6%
Abraxas Petroleum Corp. *		36,200		197,652
Adams Resources & Energy, Inc.		2,300		165,738
Alon USA Energy, Inc.		8,700		141,723
Alpha Natural Resources, Inc. *(c)		29,330		126,119
Anadarko Petroleum Corp.		85,060		8,422,641
Antero Resources Corp. *		5,900		387,453
Apache Corp.		67,272		5,839,210
Apco Oil & Gas International, Inc. *		6,500		90,870
Approach Resources, Inc. *(c)		4,000		83,000
Arch Coal, Inc. (c)		26,500		121,370
Athlon Energy, Inc. *		6,000		242,460
Atwood Oceanics, Inc. *		9,500		470,820
Baker Hughes, Inc.		73,150		5,113,186
Basic Energy Services, Inc. *		8,500		224,570
Bill Barrett Corp. *		6,700		158,656
Bonanza Creek Energy, Inc. *		6,200		301,444
Bristow Group, Inc.		6,000		460,800
C&J Energy Services, Inc. *		10,200		306,612
Cabot Oil & Gas Corp.		73,200		2,875,296

See financial notes 45

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Cal Dive International, Inc. *(c)		25,200		37,296
Callon Petroleum Co. *		18,200		167,076
Cameron International Corp. *		39,247		2,549,485
CARBO Ceramics, Inc.		3,300		461,703
Carrizo Oil & Gas, Inc. *		6,800		374,136
Cheniere Energy, Inc. *		38,600		2,178,970
Chesapeake Energy Corp.		83,500		2,400,625
Chevron Corp.		322,239		40,447,439
Cimarex Energy Co.		14,208		1,692,457
Clayton Williams Energy, Inc. *		2,500		361,200
Clean Energy Fuels Corp. *(c)		17,300		153,105
Cloud Peak Energy, Inc. *		8,700		171,303
Cobalt International Energy, Inc. *		46,700		840,600
Comstock Resources, Inc.		6,400		177,920
Concho Resources, Inc. *		17,300		2,256,785
ConocoPhillips		206,923		15,376,448
CONSOL Energy, Inc.		38,000		1,691,380
Contango Oil & Gas Co. *		5,200		249,808
Continental Resources, Inc. *		8,500		1,177,420
Core Laboratories N.V.		7,500		1,407,600
CVR Energy, Inc. (c)		5,100		250,665
Delek US Holdings, Inc.		6,300		201,537
Denbury Resources, Inc.		57,225		962,524
Devon Energy Corp.		65,460		4,582,200
Diamond Offshore Drilling, Inc. (c)		11,400		622,554
Diamondback Energy, Inc. *		5,600		402,864
Dresser-Rand Group, Inc. *		12,600		761,544
Dril-Quip, Inc. *		6,700		757,904
Energen Corp.		11,700		911,547
Energy XXI (Bermuda) Ltd.		12,200		291,946
ENGlobal Corp. *		4,000		8,560
Ensco plc, Class A		38,600		1,947,370
EOG Resources, Inc.		92,200		9,035,600
EPL Oil & Gas, Inc. *		4,900		191,786
EQT Corp.		25,900		2,822,841
Era Group, Inc. *		2,850		81,368
EXCO Resources, Inc. (c)		51,400		326,390
Exterran Holdings, Inc.		10,720		461,174
Exxon Mobil Corp.		729,434		74,701,336
FMC Technologies, Inc. *		39,064		2,214,929
Forest Oil Corp. *		12,450		23,157
Forum Energy Technologies, Inc. *		6,800		203,048
Geospace Technologies Corp. *		1,800		104,634
Goodrich Petroleum Corp. *(c)		9,800		246,470
Gulf Island Fabrication, Inc.		4,100		82,246
Gulfmark Offshore, Inc., Class A		4,100		184,541
Gulfport Energy Corp. *		13,400		987,178
Halcon Resources Corp. *(c)		43,500		240,120
Halliburton Co.		143,600		9,056,852
Harvest Natural Resources, Inc. *		9,300		41,943
Helix Energy Solutions Group, Inc. *		14,064		338,099
Helmerich & Payne, Inc.		17,500		1,901,375
Hercules Offshore, Inc. *		22,900		102,363
Hess Corp.		47,300		4,217,268
HollyFrontier Corp.		32,854		1,727,792
Hornbeck Offshore Services, Inc. *		5,000		207,150
Houston American Energy Corp. *		4,000		1,880
ION Geophysical Corp. *		13,900		61,160
Key Energy Services, Inc. *		22,300		223,892
Kinder Morgan, Inc.		111,215		3,632,282
KiOR, Inc., Class A *(c)		15,300		9,335
Kodiak Oil & Gas Corp. *		43,900		557,969
Kosmos Energy Ltd. *		16,200		176,904
Laredo Petroleum, Inc. *		11,100		324,453
Magnum Hunter Resources Corp. *		22,939		194,981
Marathon Oil Corp.		115,508		4,175,614
Marathon Petroleum Corp.		50,204		4,666,462
Matador Resources Co. *		12,100		347,512
Matrix Service Co. *		8,000		247,760
McDermott International, Inc. *		39,100		282,693
Midstates Petroleum Co., Inc. *(c)		14,400		84,960
Murphy Oil Corp.		29,000		1,839,470
Nabors Industries Ltd.		47,134		1,202,860
National Oilwell Varco, Inc.		72,822		5,718,712
Natural Gas Services Group, Inc. *		7,500		230,175
Newfield Exploration Co. *		23,600		798,860
Newpark Resources, Inc. *		11,500		138,460
Noble Corp., plc		40,900		1,260,129
Noble Energy, Inc.		61,636		4,424,232
Northern Oil & Gas, Inc. *		8,200		126,526
Oasis Petroleum, Inc. *		15,800		734,858
Occidental Petroleum Corp.		134,720		12,899,440
Oceaneering International, Inc.		17,700		1,297,056
Oil States International, Inc. *		8,600		835,404
ONEOK, Inc.		34,100		2,155,802
Panhandle Oil & Gas, Inc., Class A		3,100		135,935
Parker Drilling Co. *		18,300		121,329
Patterson-UTI Energy, Inc.		28,500		927,105
PBF Energy, Inc., Class A		8,800		270,864
PDC Energy, Inc. *		5,800		369,286
Peabody Energy Corp.		46,800		889,668
Penn Virginia Corp. *		12,200		203,008
PetroQuest Energy, Inc. *		13,200		79,464
PHI, Inc. - Non Voting Shares *		4,000		179,200
Phillips 66		98,961		8,235,534
Pioneer Energy Services Corp. *		13,100		196,107
Pioneer Natural Resources Co.		24,333		4,702,839
QEP Resources, Inc.		30,600		939,114
Quicksilver Resources, Inc. *(c)		36,100		117,686
Range Resources Corp.		28,300		2,559,735
Rentech, Inc. *		37,400		79,288
Resolute Energy Corp. *		11,900		89,250
REX American Resources Corp. *		4,875		318,630
Rex Energy Corp. *		8,000		168,480
Rosetta Resources, Inc. *		9,700		459,198
Rowan Cos. plc, Class A *		20,500		633,860
RPC, Inc.		16,118		358,303
Sanchez Energy Corp. *		8,700		246,036
SandRidge Energy, Inc. *(c)		49,331		338,411
Schlumberger Ltd.		220,660		22,408,023
SEACOR Holdings, Inc. *		2,850		237,661
SemGroup Corp., Class A		7,000		447,160
SM Energy Co.		11,200		830,256
Solazyme, Inc. *(c)		12,100		130,196
Southwestern Energy Co. *		58,000		2,777,040
Spectra Energy Corp.		114,778		4,557,834
Stone Energy Corp. *		7,383		362,136
Superior Energy Services, Inc.		26,099		859,179
Swift Energy Co. *(c)		5,500		67,815
Targa Resources Corp.		4,800		518,352
Teekay Corp.		6,000		336,660
Tesco Corp. *		7,000		140,000

46 See financial notes

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Tesoro Corp.		21,900		1,232,751
TETRA Technologies, Inc. *		12,100		151,250
The Williams Cos., Inc.		116,560		4,915,335
Tidewater, Inc.		7,700		392,161
Transocean Ltd.		59,100		2,545,437
Ultra Petroleum Corp. *(c)		25,300		753,940
Unit Corp. *		7,400		488,030
VAALCO Energy, Inc. *		12,600		116,172
Valero Energy Corp.		91,080		5,207,044
W&T Offshore, Inc.		7,500		144,000
Warren Resources, Inc. *		22,100		112,047
Weatherford International Ltd. *		127,000		2,667,000
Western Refining, Inc.		7,700		334,950
Westmoreland Coal Co. *		9,600		284,256
Whiting Petroleum Corp. *		19,600		1,444,912
World Fuel Services Corp.		11,900		541,926
WPX Energy, Inc. *		33,353		709,752
				348,084,697
Food & Staples Retailing 2.0%
Casey’s General Stores, Inc.		7,100		487,486
Costco Wholesale Corp.		74,200		8,583,456
CVS Caremark Corp.		199,590		14,514,185
Ingles Markets, Inc., Class A		10,200		234,498
PriceSmart, Inc.		2,300		220,892
Rite Aid Corp. *		140,600		1,026,380
Safeway, Inc.		40,800		1,389,648
Spartan Stores, Inc.		12,540		270,112
Sprouts Farmers Market, Inc. *		6,600		211,002
SUPERVALU, Inc. *		39,532		276,329
Susser Holdings Corp. *		2,500		193,450
Sysco Corp.		100,236		3,651,597
The Andersons, Inc.		3,600		224,244
The Fresh Market, Inc. *		5,800		215,180
The Kroger Co.		85,900		3,954,836
The Pantry, Inc. *		6,000		90,240
United Natural Foods, Inc. *		8,800		607,464
Wal-Mart Stores, Inc.		273,100		21,768,801
Walgreen Co.		147,500		10,015,250
Weis Markets, Inc.		2,400		110,616
Whole Foods Market, Inc.		61,400		3,051,580
				71,097,246
Food, Beverage & Tobacco 4.4%
Alico, Inc.		2,000		69,840
Alliance One International, Inc. *		24,600		63,222
Altria Group, Inc.		336,400		13,493,004
Annie’s, Inc. *		1,800		58,518
Archer-Daniels-Midland Co.		112,158		4,904,669
B&G Foods, Inc.		7,400		242,720
Boulder Brands, Inc. *		9,100		134,316
Brown-Forman Corp., Class B		26,735		2,398,664
Bunge Ltd.		24,400		1,943,460
Campbell Soup Co.		29,100		1,323,759
Chiquita Brands International, Inc. *		13,900		159,572
Coca-Cola Bottling Co. Consolidated		1,300		106,899
Coca-Cola Enterprises, Inc.		41,600		1,890,304
ConAgra Foods, Inc.		69,693		2,126,333
Constellation Brands, Inc., Class A *		27,500		2,195,600
Darling International, Inc. *		25,900		518,259
Dean Foods Co.		13,556		214,727
Diamond Foods, Inc. *		5,200		158,964
Dr Pepper Snapple Group, Inc.		34,000		1,884,280
Farmer Bros. Co. *		4,500		88,695
Flowers Foods, Inc.		26,605		545,935
Fresh Del Monte Produce, Inc.		7,900		228,231
General Mills, Inc.		104,700		5,551,194
Griffin Land & Nurseries, Inc.		300		8,760
Hormel Foods Corp.		21,400		1,020,566
Ingredion, Inc.		11,800		831,310
J&J Snack Foods Corp.		2,093		195,905
John B. Sanfilippo & Son, Inc.		5,000		115,250
Kellogg Co.		44,300		2,960,569
Keurig Green Mountain, Inc.		21,650		2,028,172
Kraft Foods Group, Inc.		101,104		5,748,773
Lancaster Colony Corp.		3,400		322,592
Limoneira Co.		2,900		66,613
Lorillard, Inc.		60,944		3,621,293
McCormick & Co., Inc. - Non Voting Shares		21,400		1,523,680
Mead Johnson Nutrition Co.		34,800		3,071,448
Molson Coors Brewing Co., Class B		27,700		1,661,169
Mondelez International, Inc., Class A		289,613		10,324,703
Monster Beverage Corp. *		21,600		1,446,336
National Beverage Corp. *		6,400		123,392
PepsiCo, Inc.		256,958		22,070,123
Philip Morris International, Inc.		267,600		22,861,068
Pilgrim’s Pride Corp. *		12,466		272,507
Pinnacle Foods, Inc.		8,900		270,560
Post Holdings, Inc. *		7,250		378,885
Primo Water Corp. *		1,000		4,490
Reynolds American, Inc.		53,628		3,026,228
Rocky Mountain Chocolate Factory, Inc.		3,427		40,953
Sanderson Farms, Inc.		2,850		234,470
Seaboard Corp. *		100		243,800
Snyder’s-Lance, Inc.		8,900		236,384
The Boston Beer Co., Inc., Class A *		1,200		295,248
The Coca-Cola Co.		639,600		26,089,284
The Hain Celestial Group, Inc. *		7,806		671,472
The Hershey Co.		25,800		2,482,992
The Hillshire Brands Co.		20,100		716,565
The JM Smucker Co.		16,846		1,628,671
The WhiteWave Foods Co., Class A *		27,325		756,629
Tootsie Roll Industries, Inc.		7,591		213,990
TreeHouse Foods, Inc. *		6,022		450,686
Tyson Foods, Inc., Class A		47,140		1,978,466
Universal Corp.		4,800		261,936
Vector Group Ltd. (c)		14,395		306,614
				160,863,717
Health Care Equipment & Services 4.2%
Abaxis, Inc. *		5,600		227,416
Abbott Laboratories		260,505		10,091,964

See financial notes 47

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
ABIOMED, Inc. *		7,800		184,782
Acadia Healthcare Co., Inc. *		7,000		294,140
Accuray, Inc. *		21,200		178,080
Aetna, Inc.		60,645		4,333,085
Air Methods Corp. *		4,500		250,515
Alere, Inc. *		12,441		415,529
Align Technology, Inc. *		11,700		589,563
Alliance HealthCare Services, Inc. *		360		10,246
Allscripts Healthcare Solutions, Inc. *		31,560		480,343
Amedisys, Inc. *		10,834		147,667
AmerisourceBergen Corp.		39,596		2,580,867
AMN Healthcare Services, Inc. *		17,210		214,781
Amsurg Corp. *		4,300		186,233
Analogic Corp.		2,700		202,716
Antares Pharma, Inc. *(c)		28,100		78,118
ArthroCare Corp. *		5,900		286,327
athenahealth, Inc. *		6,000		741,840
Baxter International, Inc.		91,918		6,690,711
Becton, Dickinson & Co.		32,100		3,628,263
Bio-Reference Laboratories, Inc. *(c)		7,200		182,880
BioScrip, Inc. *		8,372		57,934
Boston Scientific Corp. *		220,468		2,780,101
Brookdale Senior Living, Inc. *		18,900		601,776
C.R. Bard, Inc.		12,600		1,730,358
Cantel Medical Corp.		8,034		266,407
Cardinal Health, Inc.		56,360		3,917,584
CareFusion Corp. *		34,880		1,362,413
Centene Corp. *		9,000		597,600
Cerner Corp. *		50,200		2,575,260
Chemed Corp.		3,900		324,753
Chindex International, Inc. *		6,100		145,363
Cigna Corp.		45,300		3,625,812
Community Health Systems, Inc. *		20,196		765,226
Computer Programs & Systems, Inc.		3,600		227,268
CONMED Corp.		7,300		338,209
CorVel Corp. *		2,700		122,958
Covidien plc		76,000		5,415,000
Cross Country Healthcare, Inc. *		12,500		88,625
CryoLife, Inc.		9,050		82,174
Cyberonics, Inc. *		4,200		248,472
DaVita HealthCare Partners, Inc. *		29,200		2,023,560
DENTSPLY International, Inc.		24,300		1,084,509
DexCom, Inc. *		11,800		382,792
Edwards Lifesciences Corp. *		18,100		1,474,607
Emeritus Corp. *		9,500		283,385
Endologix, Inc. *		13,700		173,716
Envision Healthcare Holdings Inc *		11,000		371,690
ExamWorks Group, Inc. *		6,200		228,160
Express Scripts Holding Co. *		133,063		8,859,335
Five Star Quality Care, Inc. *		14,335		69,238
Gentiva Health Services, Inc. *		9,150		68,900
Globus Medical, Inc., Class A *		13,900		339,438
Greatbatch, Inc. *		6,700		308,401
Haemonetics Corp. *		7,400		224,664
Hanger, Inc. *		5,400		187,218
HCA Holdings, Inc. *		52,900		2,750,800
Health Net, Inc. *		15,500		532,115
HealthSouth Corp.		13,500		467,640
HealthStream, Inc. *		6,800		154,020
Healthways, Inc. *		8,100		145,800
HeartWare International, Inc. *		2,100		178,416
Henry Schein, Inc. *		14,500		1,656,335
Hill-Rom Holdings, Inc.		10,200		381,072
HMS Holdings Corp. *		12,200		197,274
Hologic, Inc. *		43,612		915,198
Humana, Inc.		25,700		2,820,575
ICU Medical, Inc. *		3,350		186,863
IDEXX Laboratories, Inc. *		8,600		1,087,384
Insulet Corp. *		9,800		368,774
Integra LifeSciences Holdings Corp. *		5,300		241,574
Intuitive Surgical, Inc. *		6,550		2,369,135
Invacare Corp.		6,000		94,800
IPC The Hospitalist Co., Inc. *		4,000		162,000
Kindred Healthcare, Inc.		9,208		231,121
Laboratory Corp. of America Holdings *		14,700		1,450,890
Landauer, Inc.		2,100		90,804
LCA-Vision, Inc. *		2,500		13,400
LeMaitre Vascular, Inc.		6,800		55,828
LifePoint Hospitals, Inc. *		6,707		375,055
Magellan Health Services, Inc. *		3,907		225,512
Masimo Corp. *		8,500		227,460
McKesson Corp.		38,800		6,564,572
MedAssets, Inc. *		10,200		232,866
Medical Action Industries, Inc. *		6,250		40,063
Medidata Solutions, Inc. *		9,100		330,421
MEDNAX, Inc. *		16,600		983,550
Medtronic, Inc.		168,974		9,939,051
Meridian Bioscience, Inc.		10,050		200,699
Merit Medical Systems, Inc. *		10,277		132,265
Molina Healthcare, Inc. *		6,550		244,970
MWI Veterinary Supply, Inc. *		1,700		266,288
National Healthcare Corp.		4,100		224,393
Natus Medical, Inc. *		7,600		188,708
Neogen Corp. *		4,657		194,546
NuVasive, Inc. *		10,000		337,100
NxStage Medical, Inc. *		18,700		213,928
Omnicare, Inc.		16,100		954,247
Omnicell, Inc. *		7,400		195,952
OraSure Technologies, Inc. *		12,200		79,910
Orthofix International N.V. *		2,800		84,560
Owens & Minor, Inc.		9,100		305,214
Patterson Cos., Inc.		13,100		533,170
PDI, Inc. *		2,900		13,688
PharMerica Corp. *		4,813		130,865
Premier, Inc., Class A *		5,000		150,000
Quality Systems, Inc.		10,500		155,085
Quest Diagnostics, Inc.		25,720		1,438,520
Quidel Corp. *		5,200		111,540
ResMed, Inc. (c)		24,200		1,206,370
RTI Surgical, Inc. *		18,100		77,830
Select Medical Holdings Corp.		22,600		315,496
Sirona Dental Systems, Inc. *		9,200		692,024
Spectranetics Corp. *		6,700		142,442
St. Jude Medical, Inc.		48,200		3,059,254
STERIS Corp.		8,200		394,010
Stryker Corp.		50,600		3,934,150
SurModics, Inc. *		4,200		91,392
Symmetry Medical, Inc. *		8,200		67,732

48 See financial notes

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Team Health Holdings, Inc. *		10,500		509,040
Teleflex, Inc.		6,600		673,794
Tenet Healthcare Corp. *		15,512		699,281
The Cooper Cos., Inc.		7,881		1,039,583
The Ensign Group, Inc.		5,300		225,250
The Providence Service Corp. *		4,800		194,928
Thoratec Corp. *		8,636		283,088
Triple-S Management Corp., Class B *		5,300		79,394
U.S. Physical Therapy, Inc.		3,500		107,975
Unilife Corp. *(c)		29,100		94,575
UnitedHealth Group, Inc.		166,280		12,477,651
Universal American Corp.		20,600		147,702
Universal Health Services, Inc., Class B		14,400		1,177,776
Utah Medical Products, Inc.		2,500		126,975
Varian Medical Systems, Inc. *		17,100		1,360,305
VCA Antech, Inc. *		16,800		514,584
Vocera Communications, Inc. *		3,700		56,425
Volcano Corp. *		12,200		214,232
WellCare Health Plans, Inc. *		6,200		418,314
WellPoint, Inc.		48,323		4,865,160
West Pharmaceutical Services, Inc.		11,300		490,194
Wright Medical Group, Inc. *		8,600		235,210
Zimmer Holdings, Inc.		28,200		2,729,760
				153,676,884
Household & Personal Products 1.9%
Avon Products, Inc.		70,000		1,069,600
Central Garden & Pet Co., Class A *		8,600		71,122
Church & Dwight Co., Inc.		22,400		1,545,824
Colgate-Palmolive Co.		145,100		9,765,230
Coty, Inc., Class A		15,600		250,380
Elizabeth Arden, Inc. *		3,500		128,590
Energizer Holdings, Inc.		10,933		1,221,107
Harbinger Group, Inc. *		19,100		222,706
Herbalife Ltd. (c)		15,600		935,688
Inter Parfums, Inc.		5,613		205,379
Kimberly-Clark Corp.		64,039		7,188,378
Medifast, Inc. *		3,500		110,775
Nu Skin Enterprises, Inc., Class A		9,600		835,200
Nutraceutical International Corp. *		5,000		124,600
Oil-Dri Corp. of America		1,600		53,616
Orchids Paper Products Co.		2,500		67,175
Revlon, Inc., Class A *		5,400		162,756
Spectrum Brands Holdings, Inc.		3,500		268,905
The Clorox Co.		22,300		2,022,610
The Estee Lauder Cos., Inc., Class A		43,100		3,127,767
The Female Health Co.		7,500		56,700
The Procter & Gamble Co.		457,615		37,776,118
WD-40 Co.		1,600		116,544
				67,326,770
Insurance 3.1%
ACE Ltd.		56,200		5,750,384
Aflac, Inc.		77,000		4,829,440
Alleghany Corp. *		2,740		1,117,865
Allied World Assurance Co. Holdings AG		4,900		527,681
Ambac Financial Group, Inc. *		4,000		120,720
American Equity Investment Life Holding Co.		12,600		293,832
American Financial Group, Inc.		10,750		628,122
American International Group, Inc.		247,096		13,128,210
American National Insurance Co.		2,300		258,543
AMERISAFE, Inc.		4,000		170,600
AmTrust Financial Services, Inc. (c)		7,314		282,832
Aon plc		51,496		4,370,980
Arch Capital Group Ltd. *		20,700		1,186,524
Argo Group International Holdings Ltd.		5,011		222,589
Arthur J. Gallagher & Co.		21,600		972,432
Aspen Insurance Holdings Ltd.		10,400		476,112
Assurant, Inc.		11,500		775,215
Assured Guaranty Ltd.		31,900		762,729
Axis Capital Holdings Ltd.		17,600		805,200
Baldwin & Lyons, Inc., Class B		1,950		50,720
Brown & Brown, Inc.		19,300		574,754
Cincinnati Financial Corp.		24,350		1,186,819
Citizens, Inc. *		16,000		105,120
CNA Financial Corp.		6,900		282,555
CNO Financial Group, Inc.		39,000		672,750
Crawford & Co., Class B		5,800		66,236
EMC Insurance Group, Inc.		1,200		39,588
Employers Holdings, Inc.		7,500		152,625
Endurance Specialty Holdings Ltd.		6,200		315,084
Enstar Group Ltd. *		1,300		167,830
Erie Indemnity Co., Class A		3,600		257,940
Everest Re Group Ltd.		7,700		1,216,831
FBL Financial Group, Inc., Class A		5,190		232,045
Federated National Holding Co.		1,500		29,145
Fidelity National Financial, Inc., Class A		44,553		1,433,716
First American Financial Corp.		16,800		446,880
Genworth Financial, Inc., Class A *		86,800		1,549,380
Greenlight Capital Re Ltd., Class A *		7,400		235,542
Hartford Financial Services Group, Inc.		73,800		2,647,206
HCC Insurance Holdings, Inc.		16,550		760,307
Hilltop Holdings, Inc. *		12,926		288,767
Horace Mann Educators Corp.		8,300		249,581
Independence Holding Co.		2,970		38,788
Infinity Property & Casualty Corp.		2,500		160,425
Kemper Corp.		7,700		303,457
Lincoln National Corp.		45,426		2,203,615
Loews Corp.		50,545		2,222,464
Maiden Holdings Ltd.		18,900		223,020
Markel Corp. *		2,250		1,408,320
Marsh & McLennan Cos., Inc.		93,600		4,615,416
MBIA, Inc. *		25,250		306,030
Mercury General Corp.		5,400		258,444
MetLife, Inc.		189,600		9,925,560
Montpelier Re Holdings Ltd.		8,100		247,698
National Western Life Insurance Co., Class A		500		116,625
Old Republic International Corp.		43,822		725,692
OneBeacon Insurance Group Ltd., Class A		14,800		228,512

See financial notes 49

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
PartnerRe Ltd.		8,900		938,060
Platinum Underwriters Holdings Ltd.		4,500		282,195
Primerica, Inc.		10,700		491,023
Principal Financial Group, Inc.		45,200		2,117,168
ProAssurance Corp.		8,540		387,887
Protective Life Corp.		13,200		675,180
Prudential Financial, Inc.		78,300		6,317,244
Reinsurance Group of America, Inc.		12,900		989,559
RenaissanceRe Holdings Ltd.		7,200		728,712
RLI Corp.		5,600		241,136
Safety Insurance Group, Inc.		3,400		182,614
Selective Insurance Group, Inc.		7,800		178,932
StanCorp Financial Group, Inc.		6,300		384,930
State Auto Financial Corp.		5,500		112,530
Stewart Information Services Corp.		3,600		109,800
Symetra Financial Corp.		19,000		392,540
The Allstate Corp.		75,074		4,275,464
The Chubb Corp.		41,494		3,820,768
The Hanover Insurance Group, Inc.		6,900		403,305
The Navigators Group, Inc. *		4,200		239,274
The Phoenix Cos., Inc. *		475		20,910
The Progressive Corp.		91,300		2,214,025
The Travelers Cos., Inc.		60,150		5,448,387
Torchmark Corp.		14,800		1,179,560
Tower Group International Ltd.		11,444		28,152
United Fire Group, Inc.		5,000		139,100
Unum Group		43,114		1,432,247
Validus Holdings Ltd.		16,857		624,889
W. R. Berkley Corp.		18,050		798,532
White Mountains Insurance Group Ltd.		900		536,634
Willis Group Holdings plc		29,000		1,188,710
XL Group plc		46,000		1,442,100
				110,947,064
Materials 3.8%
A. Schulman, Inc.		5,300		190,376
A.M. Castle & Co. *		5,800		71,224
AEP Industries, Inc. *		1,900		67,678
Air Products & Chemicals, Inc.		36,200		4,254,224
Airgas, Inc.		11,000		1,168,860
AK Steel Holding Corp. *(c)		32,127		224,889
Albemarle Corp.		13,300		891,632
Alcoa, Inc.		176,664		2,379,664
Allegheny Technologies, Inc.		20,092		827,790
Allied Nevada Gold Corp. *(c)		29,700		100,683
AMCOL International Corp.		6,100		279,685
American Vanguard Corp.		3,000		53,430
Ampco-Pittsburgh Corp.		4,500		90,135
AptarGroup, Inc.		10,900		734,878
Ashland, Inc.		11,923		1,151,762
Avery Dennison Corp.		16,000		778,560
Axiall Corp.		10,400		484,640
Balchem Corp.		4,200		260,190
Ball Corp.		23,900		1,342,941
Bemis Co., Inc.		16,700		672,008
Berry Plastics Group, Inc. *		12,200		274,378
Cabot Corp.		8,400		485,520
Calgon Carbon Corp. *		12,500		250,375
Carpenter Technology Corp.		8,300		521,240
Celanese Corp., Series A		26,500		1,627,895
Century Aluminum Co. *		11,600		159,500
CF Industries Holdings, Inc.		9,500		2,329,115
Chase Corp.		200		6,228
Chemtura Corp. *		14,000		312,200
Clearwater Paper Corp. *		5,472		335,926
Cliffs Natural Resources, Inc. (c)		21,100		373,892
Codexis, Inc. *		1,870		3,179
Coeur Mining, Inc. *		22,400		193,984
Commercial Metals Co.		22,800		437,760
Compass Minerals International, Inc.		5,000		458,000
Crown Holdings, Inc. *		22,800		1,075,476
Cytec Industries, Inc.		6,600		629,112
Deltic Timber Corp.		1,500		91,125
Domtar Corp.		5,250		490,140
E.I. du Pont de Nemours & Co.		156,495		10,535,243
Eagle Materials, Inc.		8,043		670,223
Eastman Chemical Co.		25,380		2,212,375
Ecolab, Inc.		46,204		4,834,787
Ferro Corp. *		21,000		272,580
Flotek Industries, Inc. *		13,300		372,533
FMC Corp.		23,300		1,794,100
Freeport-McMoRan Copper & Gold, Inc.		171,384		5,890,468
FutureFuel Corp.		8,300		166,581
General Moly, Inc. *(c)		15,700		17,270
Globe Specialty Metals, Inc.		15,900		308,142
Graphic Packaging Holding Co. *		31,900		327,294
Greif, Inc., Class A		4,300		233,017
H.B. Fuller Co.		9,000		416,970
Hawkins, Inc.		2,700		97,740
Haynes International, Inc.		2,500		132,625
Headwaters, Inc. *		12,000		149,760
Hecla Mining Co.		72,100		221,347
Horsehead Holding Corp. *		12,800		199,552
Huntsman Corp.		34,000		851,700
Innophos Holdings, Inc.		5,300		299,132
International Flavors & Fragrances, Inc.		13,500		1,330,020
International Paper Co.		73,204		3,414,967
Intrepid Potash, Inc. *(c)		11,800		192,340
Kaiser Aluminum Corp.		3,600		253,440
KapStone Paper & Packaging Corp. *		15,800		416,804
KMG Chemicals, Inc.		1,600		24,976
Koppers Holdings, Inc.		4,800		204,960
Kraton Performance Polymers, Inc. *		3,500		91,175
Kronos Worldwide, Inc.		11,720		183,418
Landec Corp. *		9,100		107,926
Louisiana-Pacific Corp. *		20,200		331,078
LSB Industries, Inc. *		3,000		114,570
LyondellBasell Industries N.V., Class A		72,600		6,715,500
Martin Marietta Materials, Inc.		7,400		920,042
Materion Corp.		4,000		134,600
McEwen Mining, Inc. *(c)		31,130		74,712
MeadWestvaco Corp.		29,374		1,147,642
Minerals Technologies, Inc.		6,200		368,838
Molycorp, Inc. *(c)		51,800		246,050

50 See financial notes

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Monsanto Co.		88,590		9,806,913
Myers Industries, Inc.		8,080		151,096
Neenah Paper, Inc.		4,231		213,115
NewMarket Corp.		1,900		707,408
Newmont Mining Corp.		81,451		2,022,428
Noranda Aluminum Holding Corp.		16,500		58,575
Nucor Corp.		54,800		2,835,900
Olin Corp.		15,820		444,542
Olympic Steel, Inc.		1,400		36,904
OM Group, Inc.		7,600		222,604
OMNOVA Solutions, Inc. *		10,400		94,848
Owens-Illinois, Inc. *		26,300		835,814
P.H. Glatfelter Co.		7,000		178,640
Packaging Corp. of America		16,100		1,072,743
Penford Corp. *		6,200		78,120
PolyOne Corp.		14,810		554,931
PPG Industries, Inc.		23,500		4,550,070
Praxair, Inc.		49,800		6,501,390
Quaker Chemical Corp.		3,200		238,176
Reliance Steel & Aluminum Co.		13,300		941,906
Resolute Forest Products, Inc. *		14,000		249,760
Rock-Tenn Co., Class A		12,813		1,225,051
Rockwood Holdings, Inc.		12,500		888,125
Royal Gold, Inc.		11,400		754,680
RPM International, Inc.		21,200		904,392
RTI International Metals, Inc. *		7,700		216,832
Schnitzer Steel Industries, Inc., Class A		3,450		96,842
Schweitzer-Mauduit International, Inc.		4,600		200,744
Sealed Air Corp.		32,000		1,097,920
Sensient Technologies Corp.		7,400		399,970
Sigma-Aldrich Corp.		19,800		1,904,958
Silgan Holdings, Inc.		6,900		343,275
Sonoco Products Co.		16,800		706,944
Steel Dynamics, Inc.		39,300		718,011
Stepan Co.		4,300		248,669
Stillwater Mining Co. *		24,633		388,709
SunCoke Energy, Inc. *		15,217		317,579
Texas Industries, Inc. *		4,000		346,800
The Dow Chemical Co.		205,266		10,242,773
The Mosaic Co.		56,300		2,817,252
The Scotts Miracle-Gro Co., Class A		7,300		446,833
The Sherwin-Williams Co.		14,100		2,817,744
The Valspar Corp.		13,300		971,432
Tredegar Corp.		5,100		106,131
Tronox Ltd., Class A		9,800		240,100
United States Steel Corp. (c)		26,300		684,326
Universal Stainless & Alloy Products, Inc. *		1,800		64,602
US Silica Holdings, Inc.		10,600		478,802
Valhi, Inc.		13,600		103,088
Vulcan Materials Co.		21,492		1,386,879
W.R. Grace & Co. *		13,600		1,252,560
Walter Energy, Inc. (c)		15,800		113,760
Wausau Paper Corp.		8,700		104,052
Westlake Chemical Corp.		5,600		398,720
Worthington Industries, Inc.		7,200		264,960
Zep, Inc.		6,600		114,114
				137,520,303
Media 3.3%
AH Belo Corp., Class A		13,980		160,910
AMC Networks, Inc., Class A *		10,400		682,968
Cablevision Systems Corp., Class A		33,200		554,440
Carmike Cinemas, Inc. *		6,300		186,858
CBS Corp., Class B - Non Voting Shares		92,106		5,320,043
Central European Media Enterprises Ltd., Class A *		9,900		27,126
Charter Communications, Inc., Class A *		11,200		1,517,936
Cinemark Holdings, Inc.		19,600		580,552
Clear Channel Outdoor Holdings, Inc., Class A		20,700		166,014
Comcast Corp., Class A		440,004		22,774,607
Crown Media Holdings, Inc., Class A *		6,000		21,480
Cumulus Media, Inc., Class A *		25,351		162,500
DIRECTV *		80,526		6,248,818
Discovery Communications, Inc., Class A *		38,461		2,919,190
DISH Network Corp., Class A *		35,600		2,024,216
DreamWorks Animation SKG, Inc., Class A *		10,200		245,106
Entercom Communications Corp., Class A *		11,000		118,800
Gannett Co., Inc.		39,000		1,059,630
Harte-Hanks, Inc.		17,200		138,288
John Wiley & Sons, Inc., Class A		9,000		517,140
Journal Communications, Inc., Class A *		16,900		135,538
Lamar Advertising Co., Class A *		12,100		604,032
Liberty Global plc, Class A *		60,875		2,424,042
Liberty Global plc, Series C *		60,875		2,339,426
Liberty Media Corp., Class A *		17,495		2,269,276
Live Nation Entertainment, Inc. *		26,457		552,422
Loral Space & Communications, Inc. *		2,800		201,572
Martha Stewart Living Omnimedia, Inc., Class A *		26,100		102,051
Media General, Inc. *(c)		6,800		104,176
Meredith Corp.		5,100		224,757
Morningstar, Inc.		3,200		234,656
National CineMedia, Inc.		13,200		200,508
News Corp., Class A *		84,687		1,441,373
Nexstar Broadcasting Group, Inc., Class A		4,500		179,325
Omnicom Group, Inc.		43,600		2,950,848
Regal Entertainment Group, Class A		12,100		227,480
Salem Communications Corp., Class A		5,700		50,217
Scholastic Corp.		7,300		240,243
Scripps Networks Interactive, Inc., Class A		19,200		1,441,344
Sinclair Broadcast Group, Inc., Class A		11,000		294,030
Sirius XM Holdings, Inc. *		485,300		1,548,107
Sizmek, Inc. *		8,300		79,514
Starz, Class A *		16,195		522,613

See financial notes 51

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
The E.W. Scripps Co., Class A *		9,800		167,874
The Interpublic Group of Cos., Inc.		73,037		1,272,304
The Madison Square Garden Co., Class A *		10,175		555,555
The New York Times Co., Class A		17,300		278,184
The Walt Disney Co.		274,993		21,817,945
Time Warner Cable, Inc.		46,511		6,579,446
Time Warner, Inc.		149,350		9,925,801
Twenty-First Century Fox, Inc., Class A		328,650		10,523,373
Viacom, Inc., Class B		67,006		5,694,170
World Wrestling Entertainment, Inc., Class A		5,700		111,150
				120,719,974
Pharmaceuticals, Biotechnology & Life Sciences 8.2%
AbbVie, Inc.		268,105		13,962,908
ACADIA Pharmaceuticals, Inc. *		16,600		334,158
Acorda Therapeutics, Inc. *		8,400		297,780
Actavis plc *		29,468		6,021,196
Acura Pharmaceuticals, Inc. *(c)		20,900		28,842
Aegerion Pharmaceuticals, Inc. *		3,800		168,188
Affymetrix, Inc. *		25,500		189,465
Agilent Technologies, Inc.		57,417		3,102,815
Akorn, Inc. *		15,400		388,388
Albany Molecular Research, Inc. *		8,800		141,328
Alexion Pharmaceuticals, Inc. *		33,400		5,283,880
Alkermes plc *		28,600		1,323,036
Allergan, Inc.		50,368		8,353,029
Alnylam Pharmaceuticals, Inc. *		8,800		435,864
AMAG Pharmaceuticals, Inc. *		6,600		120,516
Amgen, Inc.		127,468		14,244,549
Amicus Therapeutics, Inc. *		13,800		30,636
Arena Pharmaceuticals, Inc. *(c)		32,100		205,440
ARIAD Pharmaceuticals, Inc. *(c)		31,300		227,551
Arqule, Inc. *		21,000		34,020
Array BioPharma, Inc. *		24,800		98,704
Auxilium Pharmaceuticals, Inc. *		12,500		281,375
AVANIR Pharmaceuticals, Inc., Class A *		28,700		142,926
AVEO Pharmaceuticals, Inc. *		15,100		18,573
Bio-Rad Laboratories, Inc., Class A *		3,000		369,630
BioCryst Pharmaceuticals, Inc. *		23,900		205,301
Biogen Idec, Inc. *		39,925		11,463,266
BioMarin Pharmaceutical, Inc. *		23,500		1,368,405
Biota Pharmaceuticals, Inc. *		26,016		95,999
Bristol-Myers Squibb Co.		277,550		13,902,480
Bruker Corp. *		18,000		371,880
Cambrex Corp. *		7,200		147,528
Celgene Corp. *		68,045		10,003,296
Celldex Therapeutics, Inc. *		15,200		228,000
Cepheid, Inc. *		11,200		486,976
Charles River Laboratories International, Inc. *		7,416		398,388
Clovis Oncology, Inc. *		4,900		264,943
Covance, Inc. *		11,800		1,041,704
Cubist Pharmaceuticals, Inc. *		12,200		854,732
Dendreon Corp. *(c)		72,900		188,082
Depomed, Inc. *		14,500		203,145
Durect Corp. *		14,500		18,850
Dyax Corp. *		31,000		204,910
Dynavax Technologies Corp. *		109,500		178,485
Eli Lilly & Co.		166,300		9,828,330
Emergent Biosolutions, Inc. *		10,400		274,144
Endo International plc *		23,200		1,460,324
Endocyte, Inc. *		11,300		204,643
Enzo Biochem, Inc. *		43,981		184,720
Enzon Pharmaceuticals, Inc.		21,300		18,959
Exact Sciences Corp. *(c)		16,300		195,600
Exelixis, Inc. *(c)		44,700		158,238
Fluidigm Corp. *		6,000		225,360
Forest Laboratories, Inc. *		40,300		3,703,973
Furiex Pharmaceuticals, Inc. *		3,400		351,458
Genomic Health, Inc. *		8,400		220,416
Geron Corp. *(c)		46,200		91,476
Gilead Sciences, Inc. *		259,680		20,382,283
GTx, Inc. *(c)		15,900		24,486
Halozyme Therapeutics, Inc. *		28,000		208,600
Harvard Apparatus Regenerative Technology, Inc. *		4,825		41,736
Harvard Bioscience, Inc. *		19,300		81,446
Hospira, Inc. *		27,370		1,253,546
Idenix Pharmaceuticals, Inc. *(c)		11,300		62,263
Illumina, Inc. *		21,600		2,934,360
ImmunoGen, Inc. *		16,900		218,686
Immunomedics, Inc. *(c)		25,800		108,618
Impax Laboratories, Inc. *		8,500		222,275
Incyte Corp., Ltd. *		28,200		1,369,392
Infinity Pharmaceuticals, Inc. *		19,600		191,492
Intercept Pharmaceuticals, Inc. *		1,800		475,416
InterMune, Inc. *		17,100		548,568
Ironwood Pharmaceuticals, Inc. *		19,800		218,196
Isis Pharmaceuticals, Inc. *		18,600		494,946
Jazz Pharmaceuticals plc *		8,700		1,173,630
Johnson & Johnson		477,470		48,362,936
Keryx Biopharmaceuticals, Inc. *(c)		13,600		200,872
Lexicon Pharmaceuticals, Inc. *		127,500		196,350
Ligand Pharmaceuticals, Inc. *		4,948		312,565
Luminex Corp. *		12,900		247,809
Mallinckrodt plc *(c)		8,950		637,509
MannKind Corp. *(c)		40,800		267,240
Medivation, Inc. *		13,200		794,772
Merck & Co., Inc.		496,370		29,067,427
Merrimack Pharmaceuticals, Inc. *(c)		15,700		68,923
Mettler-Toledo International, Inc. *		4,800		1,118,976
Momenta Pharmaceuticals, Inc. *		13,500		154,170
Mylan, Inc. *		63,200		3,209,296
Myriad Genetics, Inc. *(c)		11,100		468,531
Nektar Therapeutics *		18,300		215,391
Neurocrine Biosciences, Inc. *		21,600		302,832
Novavax, Inc. *		52,500		229,950
NPS Pharmaceuticals, Inc. *		14,800		393,976
Oncothyreon, Inc. *(c)		25,700		73,502
OPKO Health, Inc. *(c)		33,700		278,699
Pacira Pharmaceuticals, Inc. *		6,500		445,185
Pain Therapeutics, Inc. *		18,600		105,834
PAREXEL International Corp. *		9,300		421,755
PDL BioPharma, Inc. (c)		28,700		243,663
PerkinElmer, Inc.		18,577		779,677
Perrigo Co., plc		22,900		3,317,294
Pfizer, Inc.		1,077,401		33,701,103

52 See financial notes

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Pharmacyclics, Inc. *		11,100		1,049,838
Pozen, Inc. *		16,100		134,596
Prestige Brands Holdings, Inc. *		8,500		284,920
Puma Biotechnology, Inc. *		3,400		256,836
Questcor Pharmaceuticals, Inc.		9,200		756,056
Quintiles Transnational Holdings, Inc. *		11,800		556,134
Raptor Pharmaceutical Corp. *(c)		10,500		86,835
Regeneron Pharmaceuticals, Inc. *		13,500		4,008,015
Rigel Pharmaceuticals, Inc. *		48,200		154,240
Sagent Pharmaceuticals, Inc. *		9,800		202,762
Salix Pharmaceuticals Ltd. *		10,100		1,111,000
Sangamo BioSciences, Inc. *		14,600		202,064
Sarepta Therapeutics, Inc. *(c)		9,800		363,874
Seattle Genetics, Inc. *		17,900		688,792
Sequenom, Inc. *(c)		87,600		239,148
Spectrum Pharmaceuticals, Inc. *		24,200		166,254
Sucampo Pharmaceuticals, Inc., Class A *		12,400		85,684
Synageva BioPharma Corp. *		4,100		354,117
Synta Pharmaceuticals Corp. *(c)		43,900		184,819
Techne Corp.		5,800		517,998
The Medicines Co. *		10,600		281,960
Theravance, Inc. *(c)		13,700		368,804
Thermo Fisher Scientific, Inc.		66,502		7,581,228
United Therapeutics Corp. *		7,600		760,076
Vertex Pharmaceuticals, Inc. *		40,544		2,744,829
Vical, Inc. *		34,400		38,872
Vivus, Inc. *(c)		23,400		121,680
Waters Corp. *		14,100		1,389,414
XenoPort, Inc. *		37,200		151,032
Zalicus, Inc. *(c)		8,433		9,023
ZIOPHARM Oncology, Inc. *(c)		55,300		199,080
Zoetis, Inc.		82,600		2,499,476
				297,524,440
Real Estate 3.6%
Acadia Realty Trust		9,600		260,448
AG Mortgage Investment Trust, Inc.		12,000		212,280
Agree Realty Corp.		5,000		149,350
Alexander & Baldwin, Inc.		6,400		238,784
Alexander’s, Inc.		800		276,608
Alexandria Real Estate Equities, Inc.		11,800		871,076
Altisource Portfolio Solutions S.A. *		2,800		290,388
Altisource Residential Corp.		5,000		140,600
American Assets Trust, Inc.		8,000		271,600
American Campus Communities, Inc.		17,300		660,860
American Capital Agency Corp.		62,500		1,419,375
American Capital Mortgage Investment Corp.		14,600		289,080
American Realty Capital Properties, Inc.		119,000		1,557,710
American Realty Investors, Inc. *		1,537		13,756
American Tower Corp.		67,100		5,604,192
Annaly Capital Management, Inc.		166,400		1,921,920
Anworth Mortgage Asset Corp.		24,200		130,680
Apartment Investment & Management Co., Class A		23,111		712,512
Apollo Commercial Real Estate Finance, Inc.		11,400		193,914
Apollo Residential Mortgage, Inc.		12,900		208,335
ARMOUR Residential REIT, Inc.		61,000		258,640
Ashford Hospitality Prime, Inc.		1,800		27,612
Ashford Hospitality Trust, Inc.		9,000		92,340
Associated Estates Realty Corp.		6,900		115,782
AV Homes, Inc. *		6,500		111,345
AvalonBay Communities, Inc.		20,892		2,852,803
BioMed Realty Trust, Inc.		31,700		662,530
Boston Properties, Inc.		26,100		3,057,354
Brandywine Realty Trust		25,863		376,307
Camden Property Trust		14,100		965,709
Campus Crest Communities, Inc.		17,900		154,119
Capstead Mortgage Corp.		21,740		277,837
CBL & Associates Properties, Inc.		26,785		486,683
CBRE Group, Inc., Class A *		46,800		1,246,752
Cedar Realty Trust, Inc.		33,200		205,508
Chambers Street Properties		37,300		290,567
Chesapeake Lodging Trust		8,500		229,415
Chimera Investment Corp.		169,700		524,373
CIM Commercial Trust Corp. (c)		1,700		37,587
Colony Financial, Inc.		12,600		274,050
Columbia Property Trust, Inc.		20,200		572,468
CommonWealth REIT		17,650		448,487
Consolidated-Tomoka Land Co.		2,000		79,060
CoreSite Realty Corp.		3,400		103,428
Corporate Office Properties Trust		14,400		385,200
Corrections Corp. of America		20,285		665,348
Cousins Properties, Inc.		28,345		329,652
Crown Castle International Corp.		57,276		4,165,683
CubeSmart		21,400		398,040
CYS Investments, Inc.		25,500		219,300
DCT Industrial Trust, Inc.		45,000		351,900
DDR Corp.		54,584		937,207
DiamondRock Hospitality Co.		32,286		396,149
Digital Realty Trust, Inc. (c)		21,200		1,132,080
Douglas Emmett, Inc.		19,200		529,920
Duke Realty Corp.		59,590		1,044,017
DuPont Fabros Technology, Inc.		9,200		222,916
EastGroup Properties, Inc.		6,300		398,475
Education Realty Trust, Inc.		27,500		280,500
EPR Properties		9,600		514,656
Equity Lifestyle Properties, Inc.		12,000		502,440
Equity One, Inc.		12,100		272,613
Equity Residential		57,900		3,441,576
Essex Property Trust, Inc.		10,073		1,745,248
Excel Trust, Inc.		14,000		176,680
Extra Space Storage, Inc.		18,200		952,406
Federal Realty Investment Trust		11,200		1,316,448
FelCor Lodging Trust, Inc.		12,200		112,606
First Industrial Realty Trust, Inc.		15,900		292,083
First Potomac Realty Trust		14,800		192,844
Forest City Enterprises, Inc., Class A *		23,900		451,949
Forestar Group, Inc. *		4,933		84,108
Franklin Street Properties Corp.		22,500		274,050
Gaming & Leisure Properties, Inc.		13,718		504,137
General Growth Properties, Inc.		89,309		2,051,428
Getty Realty Corp.		9,500		179,740

See financial notes 53

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Glimcher Realty Trust		20,000		203,800
Government Properties Income Trust		9,900		251,955
Gramercy Property Trust, Inc.		27,228		142,130
Hatteras Financial Corp.		13,800		270,066
HCP, Inc.		78,348		3,279,647
Health Care REIT, Inc.		47,700		3,009,393
Healthcare Realty Trust, Inc.		15,800		397,370
Healthcare Trust of America, Inc., Class A		27,300		319,137
Hersha Hospitality Trust		40,000		232,400
Highwoods Properties, Inc.		13,300		536,655
Home Properties, Inc.		9,500		585,200
Hospitality Properties Trust		24,500		736,225
Host Hotels & Resorts, Inc.		129,863		2,785,561
Hudson Pacific Properties, Inc.		9,100		214,305
Inland Real Estate Corp.		20,300		212,135
Invesco Mortgage Capital, Inc.		22,300		371,741
Investors Real Estate Trust		28,600		249,392
iStar Financial, Inc. *		13,390		198,975
Jones Lang LaSalle, Inc.		7,300		845,997
Kennedy-Wilson Holdings, Inc.		12,200		266,448
Kilroy Realty Corp.		12,900		768,453
Kimco Realty Corp.		67,695		1,551,569
Kite Realty Group Trust		31,300		194,060
LaSalle Hotel Properties		19,700		651,676
Lexington Realty Trust		33,567		361,181
Liberty Property Trust		24,200		907,500
LTC Properties, Inc.		4,800		185,424
Mack-Cali Realty Corp.		18,500		376,845
Maui Land & Pineapple Co., Inc. *		800		6,264
Medical Properties Trust, Inc.		24,300		328,050
MFA Financial, Inc.		60,500		479,765
Mid-America Apartment Communities, Inc.		12,844		894,585
Monmouth Real Estate Investment Corp., Class A		18,100		169,959
National Health Investors, Inc.		5,900		363,971
National Retail Properties, Inc.		20,120		686,696
New Century Financial Corp. *(b)(g)		3,600		—
New Residential Investment Corp.		42,700		260,470
Newcastle Investment Corp.		59,300		266,257
NorthStar Realty Finance Corp.		47,800		765,756
Omega Healthcare Investors, Inc.		22,684		788,950
One Liberty Properties, Inc.		1,400		30,982
Parkway Properties, Inc.		14,940		281,768
Pebblebrook Hotel Trust		12,300		423,612
Pennsylvania Real Estate Investment Trust		13,900		230,045
PennyMac Mortgage Investment Trust		14,400		337,536
Piedmont Office Realty Trust, Inc., Class A		27,500		484,275
Plum Creek Timber Co., Inc.		28,647		1,249,009
Post Properties, Inc.		8,200		411,722
Potlatch Corp.		5,753		219,937
Preferred Apartment Communities, Inc., Class A		3,700		29,933
Prologis, Inc.		84,834		3,446,805
PS Business Parks, Inc.		3,000		257,310
Public Storage		24,790		4,350,893
RAIT Financial Trust		16,199		132,508
Ramco-Gershenson Properties Trust		13,400		220,832
Rayonier, Inc.		20,882		941,778
Realogy Holdings Corp. *		24,700		1,038,635
Realty Income Corp.		36,535		1,587,446
Redwood Trust, Inc.		11,300		246,340
Regency Centers Corp.		14,200		744,506
Resource Capital Corp.		28,600		157,300
Retail Opportunity Investments Corp.		14,400		225,216
Retail Properties of America, Inc., Class A		28,700		410,984
RLJ Lodging Trust		20,300		541,401
Rouse Properties, Inc.		10,715		179,905
Ryman Hospitality Properties, Inc. (c)		7,837		356,975
Sabra Health Care REIT, Inc.		8,000		239,760
Saul Centers, Inc.		4,700		215,683
Select Income REIT		8,600		264,708
Senior Housing Properties Trust		31,050		728,744
Silver Bay Realty Trust Corp.		13,033		195,234
Simon Property Group, Inc.		53,083		9,193,976
SL Green Realty Corp.		15,350		1,607,299
Sovran Self Storage, Inc.		4,500		341,550
Spirit Realty Capital, Inc.		69,048		743,647
STAG Industrial, Inc.		11,900		280,007
Starwood Property Trust, Inc.		32,200		774,410
Starwood Waypoint Residential Trust *		6,440		174,975
Strategic Hotels & Resorts, Inc. *		25,000		269,750
Summit Hotel Properties, Inc.		9,600		86,976
Sun Communities, Inc.		6,000		273,420
Sunstone Hotel Investors, Inc.		27,600		394,956
Tanger Factory Outlet Centers, Inc.		15,600		556,608
Taubman Centers, Inc.		10,100		735,684
Tejon Ranch Co. *		3,674		113,931
The Geo Group, Inc.		11,899		398,973
The Howard Hughes Corp. *		5,100		728,076
The Macerich Co.		24,905		1,616,584
The St. Joe Co. *		12,900		230,265
Two Harbors Investment Corp.		60,300		625,914
UDR, Inc.		42,961		1,110,971
UMH Properties, Inc.		7,900		77,815
Universal Health Realty Income Trust		4,700		199,421
Urstadt Biddle Properties, Inc., Class A		4,500		91,845
Ventas, Inc.		48,550		3,208,184
Vornado Realty Trust REIT		28,741		2,948,827
Washington Real Estate Investment Trust		9,700		237,262
Weingarten Realty Investors		17,175		535,860
Western Asset Mortgage Capital Corp.		4,607		68,045
Weyerhaeuser Co.		99,992		2,984,761
Whitestone REIT		2,100		29,463
Winthrop Realty Trust		10,000		139,000
WP Carey, Inc.		9,200		565,616
				130,037,439

54 See financial notes

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Retailing 4.0%
Aaron’s, Inc.		14,675		432,472
Abercrombie & Fitch Co., Class A		11,800		433,768
Advance Auto Parts, Inc.		11,940		1,448,203
Aeropostale, Inc. *(c)		25,600		127,232
Amazon.com, Inc. *		62,800		19,099,364
America’s Car-Mart, Inc. *		6,850		247,559
American Eagle Outfitters, Inc.		27,450		317,322
ANN, Inc. *		6,625		259,634
Asbury Automotive Group, Inc. *		4,100		253,134
Ascena Retail Group, Inc. *		21,236		365,259
AutoNation, Inc. *		10,100		535,199
AutoZone, Inc. *		5,800		3,096,562
Barnes & Noble, Inc. *		7,400		121,360
Bed Bath & Beyond, Inc. *		35,500		2,205,615
Best Buy Co., Inc.		45,125		1,170,091
Big Lots, Inc. *		8,000		316,000
Brown Shoe Co., Inc.		6,675		157,463
Cabela’s, Inc. *		7,700		505,197
CarMax, Inc. *		36,846		1,613,118
Chico’s FAS, Inc.		26,200		416,056
Christopher & Banks Corp. *		13,400		83,616
Conn’s, Inc. *(c)		7,900		349,417
Core-Mark Holding Co., Inc.		2,000		161,080
CST Brands, Inc.		12,286		400,892
Destination Maternity Corp.		5,000		123,300
Dick’s Sporting Goods, Inc.		17,500		921,550
Dillard’s, Inc., Class A		4,300		421,099
Dollar General Corp. *		48,700		2,748,628
Dollar Tree, Inc. *		35,350		1,840,674
DSW, Inc., Class A		11,560		385,988
Expedia, Inc.		16,972		1,204,842
Express, Inc. *		12,600		183,582
Family Dollar Stores, Inc.		16,300		957,625
Five Below, Inc. *		7,800		314,418
Foot Locker, Inc.		23,800		1,107,414
Francesca’s Holdings Corp. *		13,300		217,588
Fred’s, Inc., Class A		6,700		122,074
FTD Cos., Inc. *		8,070		244,844
GameStop Corp., Class A		19,348		767,729
Geeknet, Inc. *		452		6,690
Genesco, Inc. *		4,300		328,391
Genuine Parts Co.		25,500		2,221,560
GNC Holdings, Inc., Class A		15,500		697,500
Group 1 Automotive, Inc.		4,400		317,372
Groupon, Inc. *		58,800		411,012
Guess?, Inc.		7,900		212,589
Hibbett Sports, Inc. *		3,543		190,791
HomeAway, Inc. *		10,400		339,248
HSN, Inc.		6,269		363,853
J.C. Penney Co., Inc. *(c)		50,700		431,964
Jos. A. Bank Clothiers, Inc. *		3,600		232,380
Kirkland’s, Inc. *		8,700		148,857
Kohl’s Corp.		33,200		1,819,028
L Brands, Inc.		42,220		2,288,324
Lands’ End, Inc. *(c)		1,920		53,088
Liberty Interactive Corp., Class A *		81,009		2,354,122
Liberty Ventures, Series A *		11,330		657,593
Lithia Motors, Inc., Class A		3,300		245,124
LKQ Corp. *		49,600		1,444,352
Lowe’s Cos., Inc.		176,500		8,103,115
Lumber Liquidators Holdings, Inc. *		4,600		400,936
Macy’s, Inc.		61,052		3,506,216
MarineMax, Inc. *		16,300		261,778
Monro Muffler Brake, Inc.		4,462		251,657
Murphy USA, Inc. *		6,875		292,188
Netflix, Inc. *		10,200		3,284,808
Nordstrom, Inc.		23,600		1,446,208
O’Reilly Automotive, Inc. *		17,999		2,678,071
Office Depot, Inc. *		77,256		315,977
Outerwall, Inc. *(c)		5,000		346,750
Pacific Sunwear of California, Inc. *		41,175		118,584
Penske Automotive Group, Inc.		6,300		288,918
PetSmart, Inc.		17,100		1,157,328
Pier 1 Imports, Inc.		15,800		288,508
Pool Corp.		6,662		393,191
RadioShack Corp. *(c)		27,200		38,896
Rent-A-Center, Inc.		7,750		226,378
Restoration Hardware Holdings, Inc. *		4,200		262,038
Ross Stores, Inc.		35,800		2,437,264
Sally Beauty Holdings, Inc. *		24,850		681,138
Sears Holdings Corp. *(c)		6,385		279,727
Select Comfort Corp. *		12,200		224,480
Shoe Carnival, Inc.		6,300		143,892
Shutterfly, Inc. *		6,300		257,859
Signet Jewelers Ltd.		14,000		1,418,480
Sonic Automotive, Inc., Class A		11,200		272,608
Stage Stores, Inc.		5,700		109,326
Staples, Inc.		107,500		1,343,750
Stein Mart, Inc.		10,300		128,750
Systemax, Inc. *		8,000		138,320
Target Corp.		107,000		6,607,250
The Buckle, Inc. (c)		3,875		182,086
The Cato Corp., Class A		7,100		202,279
The Children’s Place Retail Stores, Inc.		3,600		172,800
The Finish Line, Inc., Class A		7,161		197,142
The Gap, Inc.		46,400		1,823,520
The Home Depot, Inc.		237,670		18,897,142
The Men’s Wearhouse, Inc.		6,600		312,708
The Pep Boys - Manny, Moe & Jack *		19,400		198,268
The Priceline Group, Inc. *		8,783		10,168,518
The TJX Cos., Inc.		120,000		6,981,600
The Wet Seal, Inc., Class A *(c)		31,400		35,482
Tiffany & Co.		18,600		1,627,314
Tractor Supply Co.		23,100		1,553,244
Trans World Entertainment Corp.		9,700		31,719
TripAdvisor, Inc. *		18,272		1,475,281
Tuesday Morning Corp. *		10,800		150,984
Ulta Salon, Cosmetics & Fragrance, Inc. *		10,100		885,871
Urban Outfitters, Inc. *		18,000		641,790
Vitamin Shoppe, Inc. *		4,200		201,096
VOXX International Corp. *		9,100		106,925
West Marine, Inc. *		8,200		87,740
Williams-Sonoma, Inc.		14,000		879,480
Winmark Corp.		1,700		128,962
Zale Corp. *		8,320		177,965

See financial notes 55

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Zumiez, Inc. *		10,500		256,725
				145,521,836
Semiconductors & Semiconductor Equipment 2.2%
Advanced Energy Industries, Inc. *		4,500		98,460
Advanced Micro Devices, Inc. *(c)		123,300		504,297
Altera Corp.		53,000		1,723,560
Amkor Technology, Inc. *		19,300		153,435
Amtech Systems, Inc. *		3,500		29,925
ANADIGICS, Inc. *		8,150		10,187
Analog Devices, Inc.		51,400		2,636,306
Applied Materials, Inc.		206,598		3,937,758
Applied Micro Circuits Corp. *		21,300		206,823
Atmel Corp. *		64,100		498,057
Avago Technologies Ltd.		43,300		2,749,550
AXT, Inc. *		3,500		7,560
Broadcom Corp., Class A		89,100		2,745,171
Brooks Automation, Inc.		11,885		121,584
Cabot Microelectronics Corp. *		5,660		245,474
Cavium, Inc. *		10,400		440,648
Ceva, Inc. *		7,233		117,392
Cirrus Logic, Inc. *		9,800		218,540
Cohu, Inc.		7,500		77,250
Cree, Inc. *		20,900		985,853
Cypress Semiconductor Corp. *		19,500		184,665
Diodes, Inc. *		11,012		290,386
DSP Group, Inc. *		6,300		50,148
Entegris, Inc. *		19,299		214,026
Entropic Communications, Inc. *		20,100		74,169
Exar Corp. *		9,834		106,404
Fairchild Semiconductor International, Inc. *		17,800		226,594
First Solar, Inc. *		10,900		735,641
FormFactor, Inc. *		14,600		83,950
Freescale Semiconductor Ltd. *		15,000		329,550
GSI Technology, Inc. *		8,500		53,975
GT Advanced Technologies, Inc. *		29,500		489,995
Hittite Microwave Corp.		4,500		267,120
Integrated Device Technology, Inc. *		26,920		314,156
Integrated Silicon Solution, Inc. *		9,338		135,027
Intel Corp.		839,232		22,399,102
International Rectifier Corp. *		8,600		223,944
Intersil Corp., Class A		26,764		330,268
IXYS Corp.		6,900		74,451
KLA-Tencor Corp.		29,000		1,855,710
Kopin Corp. *		19,600		63,896
Kulicke & Soffa Industries, Inc. *		18,500		272,135
Lam Research Corp. *		27,067		1,559,330
Lattice Semiconductor Corp. *		25,100		211,342
Linear Technology Corp.		38,700		1,722,150
LSI Corp.		88,787		989,087
Marvell Technology Group Ltd.		73,200		1,160,952
Maxim Integrated Products, Inc.		48,200		1,563,608
Micrel, Inc.		9,700		96,612
Microchip Technology, Inc.		34,875		1,657,957
Micron Technology, Inc. *		173,699		4,537,018
Microsemi Corp. *		13,152		309,335
MKS Instruments, Inc.		7,900		222,385
Monolithic Power Systems, Inc. *		6,500		241,150
MoSys, Inc. *		6,400		25,024
Nanometrics, Inc. *		5,300		86,178
NVIDIA Corp.		97,000		1,791,590
OmniVision Technologies, Inc. *		13,900		271,467
ON Semiconductor Corp. *		75,165		707,303
Pericom Semiconductor Corp. *		6,600		53,262
Photronics, Inc. *		18,000		156,240
PLX Technology, Inc. *		14,100		81,780
PMC-Sierra, Inc. *		27,300		186,732
Power Integrations, Inc.		4,200		198,366
Rambus, Inc. *		19,600		236,964
RF Micro Devices, Inc. *		40,720		343,677
Rudolph Technologies, Inc. *		16,418		149,568
Semtech Corp. *		9,700		232,606
Silicon Image, Inc. *		19,500		109,395
Silicon Laboratories, Inc. *		5,000		224,750
Skyworks Solutions, Inc. *		32,889		1,350,093
Spansion, Inc., Class A *		8,600		153,338
SunEdison, Inc. *		38,900		748,047
SunPower Corp. *(c)		6,800		227,256
Synaptics, Inc. *		5,250		326,287
Teradyne, Inc. *		34,959		617,726
Tessera Technologies, Inc.		11,100		243,423
Texas Instruments, Inc.		184,097		8,367,209
TriQuint Semiconductor, Inc. *		32,110		455,320
Ultratech, Inc. *		4,800		127,776
Veeco Instruments, Inc. *		8,800		325,336
Xilinx, Inc.		44,300		2,090,517
				80,441,298
Software & Services 9.4%
Accenture plc, Class A		107,500		8,623,650
ACI Worldwide, Inc. *		7,700		440,055
Activision Blizzard, Inc.		71,232		1,425,352
Actuate Corp. *		13,962		78,606
Acxiom Corp. *		13,300		375,592
Adobe Systems, Inc. *		79,010		4,874,127
Advent Software, Inc.		7,900		227,678
Akamai Technologies, Inc. *		29,538		1,567,582
Alliance Data Systems Corp. *		9,000		2,177,100
Amdocs Ltd.		26,600		1,237,698
Angie’s List, Inc. *		8,000		90,480
ANSYS, Inc. *		15,286		1,166,475
AOL, Inc. *		12,922		553,191
Aspen Technology, Inc. *		15,400		662,046
Autodesk, Inc. *		37,300		1,791,146
Automatic Data Processing, Inc.		81,400		6,345,944
Bankrate, Inc. *		14,600		255,792
Bazaarvoice, Inc. *		15,200		102,144
Blackbaud, Inc.		6,000		182,700
Blackhawk Network Holdings, Inc., Class B *		6,703		154,370
Blucora, Inc. *		11,572		222,761
Booz Allen Hamilton Holding Corp.		12,300		285,852
Bottomline Technologies de, Inc. *		8,800		278,432
Broadridge Financial Solutions, Inc.		19,725		756,256
BroadSoft, Inc. *		6,500		164,970
CA, Inc.		53,608		1,615,745
CACI International, Inc., Class A *		4,100		285,565
Cadence Design Systems, Inc. *		47,500		739,100

56 See financial notes

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Cardtronics, Inc. *		8,800		294,624
CIBER, Inc. *		24,900		107,568
Citrix Systems, Inc. *		30,800		1,826,748
Cognizant Technology Solutions Corp., Class A *		103,000		4,934,215
CommVault Systems, Inc. *		6,900		333,960
Computer Sciences Corp.		24,338		1,440,323
Compuware Corp.		31,800		329,448
comScore, Inc. *		7,500		234,975
Comverse, Inc. *		6,250		155,875
Concur Technologies, Inc. *		7,600		611,572
Constant Contact, Inc. *		7,000		181,020
Convergys Corp.		16,000		344,640
Conversant, Inc. *		12,000		293,280
CoreLogic, Inc. *		13,800		386,814
Cornerstone OnDemand, Inc. *		7,100		260,996
CoStar Group, Inc. *		4,500		724,005
CSG Systems International, Inc.		8,900		234,604
Dealertrack Technologies, Inc. *		6,100		278,709
Demand Media, Inc. *		29,600		123,136
Demandware, Inc. *		6,800		337,484
Digimarc Corp.		3,542		116,957
Digital River, Inc. *		7,100		108,559
DST Systems, Inc.		4,300		396,417
EarthLink Holdings Corp.		17,050		58,141
eBay, Inc. *		196,648		10,192,266
Ebix, Inc. (c)		7,200		113,616
Edgewater Technology, Inc. *		767		5,430
Electronic Arts, Inc. *		51,000		1,443,300
Ellie Mae, Inc. *		4,700		114,633
Envestnet, Inc. *		7,300		269,005
EPAM Systems, Inc. *		7,800		242,814
Epiq Systems, Inc.		8,525		109,035
Equinix, Inc. *		8,265		1,552,250
Euronet Worldwide, Inc. *		8,800		404,712
EVERTEC, Inc.		14,000		329,560
ExlService Holdings, Inc. *		7,200		203,724
Facebook, Inc., Class A *		288,400		17,240,552
FactSet Research Systems, Inc.		6,650		708,225
Fair Isaac Corp.		4,744		271,357
FalconStor Software, Inc. *		1,200		1,824
Fidelity National Information Services, Inc.		48,106		2,570,304
FireEye, Inc. *		5,100		200,226
Fiserv, Inc. *		42,600		2,589,228
FleetCor Technologies, Inc. *		12,100		1,380,973
Forrester Research, Inc.		6,800		240,924
Fortinet, Inc. *		20,500		450,590
Gartner, Inc. *		14,800		1,020,312
Genpact Ltd. *		18,800		316,968
Global Cash Access Holdings, Inc. *		28,300		186,780
Global Payments, Inc.		11,440		764,535
Google, Inc., Class A *		47,665		25,495,055
Google, Inc., Class C *		47,665		25,103,249
GSE Systems, Inc. *		2,424		4,242
Guidewire Software, Inc. *		10,800		407,808
Heartland Payment Systems, Inc.		4,500		184,230
Higher One Holdings, Inc. *		19,400		116,206
IAC/InterActiveCorp		12,672		839,900
iGATE Corp. *		8,800		322,080
Imperva, Inc. *		4,700		107,536
Infoblox, Inc. *		8,600		168,732
Informatica Corp. *		18,000		638,100
Information Services Group, Inc. *		7,500		37,125
Interactive Intelligence Group, Inc. *		2,900		181,453
Internap Network Services Corp. *		13,200		88,704
International Business Machines Corp.		165,210		32,458,809
Intralinks Holdings, Inc. *		12,200		111,630
Intuit, Inc.		48,730		3,691,297
j2 Global, Inc.		9,000		417,240
Jack Henry & Associates, Inc.		13,800		761,208
Jive Software, Inc. *		8,600		64,328
Leidos Holdings, Inc.		11,000		409,640
LinkedIn Corp., Class A *		16,500		2,532,255
Lionbridge Technologies, Inc. *		19,500		114,660
Liquidity Services, Inc. *		6,200		106,950
LivePerson, Inc. *		19,700		195,030
LogMeIn, Inc. *		7,600		345,420
Looksmart Ltd. *		160		267
Manhattan Associates, Inc. *		11,600		365,748
ManTech International Corp., Class A		8,600		256,538
MasterCard, Inc., Class A		173,200		12,738,860
Mattersight Corp. *		190		1,199
MAXIMUS, Inc.		11,300		481,041
Mentor Graphics Corp.		13,800		285,660
MICROS Systems, Inc. *		12,400		638,600
Microsoft Corp.		1,274,950		51,507,980
MicroStrategy, Inc., Class A *		2,256		273,946
Millennial Media, Inc. *(c)		21,300		136,107
ModusLink Global Solutions, Inc. *		10,450		42,218
MoneyGram International, Inc. *		9,037		119,288
Monotype Imaging Holdings, Inc.		6,500		171,665
Monster Worldwide, Inc. *		35,800		246,662
Move, Inc. *		12,430		132,877
Netscout Systems, Inc. *		7,300		284,408
NetSuite, Inc. *		4,900		378,819
NeuStar, Inc., Class A *		9,300		239,196
NIC, Inc.		8,000		146,720
Nuance Communications, Inc. *		42,274		680,189
OpenTable, Inc. *		3,400		228,344
Oracle Corp.		584,549		23,896,363
Pandora Media, Inc. *		27,500		644,050
Paychex, Inc.		53,600		2,241,016
Pegasystems, Inc.		12,800		212,096
Perficient, Inc. *		7,800		142,506
PRGX Global, Inc. *		11,000		70,730
Progress Software Corp. *		9,300		199,578
PTC, Inc. *		19,780		699,619
Qlik Technologies, Inc. *		14,100		309,918
Rackspace Hosting, Inc. *		19,400		562,988
RealNetworks, Inc. *		12,725		95,946
RealPage, Inc. *		10,500		186,375
Red Hat, Inc. *		31,300		1,522,745
Reis, Inc. *		1,400		23,044
Rovi Corp. *		15,412		343,533
Salesforce.com, Inc. *		94,700		4,891,255
Sapient Corp. *		16,100		261,947
Science Applications International Corp.		6,285		245,115
Seachange International, Inc. *		9,250		86,672

See financial notes 57

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
ServiceNow, Inc. *		16,700		830,324
ServiceSource International, Inc. *		14,400		89,856
Shutterstock, Inc. *		4,000		290,040
SolarWinds, Inc. *		12,000		483,840
Solera Holdings, Inc.		11,400		738,492
Splunk, Inc. *		15,200		829,464
SS&C Technologies Holdings, Inc. *		11,700		455,364
StarTek, Inc. *		3,900		27,105
support.com, Inc. *		18,400		45,448
Sykes Enterprises, Inc. *		11,026		218,205
Symantec Corp.		114,873		2,329,624
Synchronoss Technologies, Inc. *		8,100		246,564
Synopsys, Inc. *		24,384		917,326
Syntel, Inc. *		2,500		200,800
Tableau Software, Inc., Class A *		2,600		143,702
Take-Two Interactive Software, Inc. *		12,900		262,902
Tangoe, Inc. *		8,200		123,328
TeleCommunication Systems, Inc., Class A *		10,800		27,540
TeleTech Holdings, Inc. *		9,100		219,583
Teradata Corp. *		27,000		1,227,420
The Hackett Group, Inc.		7,200		43,200
The Ultimate Software Group, Inc. *		4,600		550,298
The Western Union Co.		90,332		1,433,569
TIBCO Software, Inc. *		23,200		455,416
TiVo, Inc. *		17,800		211,108
Total System Services, Inc.		27,404		870,625
Trulia, Inc. *(c)		5,400		183,600
Twitter, Inc. *(c)		11,500		448,155
Tyler Technologies, Inc. *		4,700		383,755
Unisys Corp. *		6,200		151,094
United Online, Inc.		2,478		29,364
Unwired Planet, Inc. *		7,771		17,718
Vantiv, Inc., Class A *		24,900		765,675
VeriFone Systems, Inc. *		18,000		601,920
Verint Systems, Inc. *		9,510		416,253
VeriSign, Inc. *		22,275		1,050,934
VirnetX Holding Corp. *(c)		10,600		166,950
Virtusa Corp. *		4,700		154,959
Visa, Inc., Class A		85,600		17,343,416
VMware, Inc., Class A *		14,200		1,313,642
Web.com Group, Inc. *		8,923		274,025
WebMD Health Corp. *		7,074		311,893
WEX, Inc. *		6,400		614,208
Workday, Inc., Class A *		4,900		358,043
Xerox Corp.		186,756		2,257,880
Yahoo! Inc. *		159,644		5,739,202
Yelp, Inc. *		9,300		542,376
Zillow, Inc., Class A *(c)		4,500		489,150
Zynga, Inc., Class A *		127,000		514,350
				342,012,042
Technology Hardware & Equipment 5.8%
3D Systems Corp. *(c)		15,900		752,706
ADTRAN, Inc.		9,100		204,113
Agilysys, Inc. *		8,460		106,088
Amphenol Corp., Class A		27,400		2,612,590
Anixter International, Inc.		4,000		391,920
Apple, Inc.		150,600		88,867,554
ARRIS Group, Inc. *		18,975		495,058
Arrow Electronics, Inc. *		15,700		890,975
Aruba Networks, Inc. *		15,700		310,389
Aviat Networks, Inc. *		18,877		28,504
Avnet, Inc.		22,588		974,220
AVX Corp.		14,000		186,900
Badger Meter, Inc.		4,000		198,200
Belden, Inc.		6,900		509,289
Benchmark Electronics, Inc. *		7,830		181,499
Black Box Corp.		4,100		87,166
Brocade Communications Systems, Inc. *		73,835		687,404
CalAmp Corp. *		4,000		71,000
CDW Corp.		9,700		273,443
Checkpoint Systems, Inc. *		7,100		90,667
Ciena Corp. *		17,970		355,267
Cisco Systems, Inc.		869,509		20,094,353
Cognex Corp. *		14,800		509,564
Coherent, Inc. *		4,100		244,811
Comtech Telecommunications Corp.		4,175		132,556
Corning, Inc.		239,007		4,997,636
Cray, Inc. *		7,600		218,196
CTS Corp.		8,800		156,552
Daktronics, Inc.		8,700		113,274
Diebold, Inc.		9,000		338,490
Digi International, Inc. *		9,100		80,626
Dolby Laboratories, Inc., Class A *		8,800		350,680
DTS, Inc. *		4,300		80,023
Echelon Corp. *		7,200		18,648
EchoStar Corp., Class A *		6,740		303,030
Electro Rent Corp.		7,100		114,665
Electro Scientific Industries, Inc.		9,900		83,952
Electronics for Imaging, Inc. *		6,400		241,856
EMC Corp.		339,786		8,766,479
Emulex Corp. *		14,100		100,815
Extreme Networks, Inc. *		27,500		157,300
F5 Networks, Inc. *		13,100		1,377,727
FARO Technologies, Inc. *		3,000		119,700
FEI Co.		6,600		524,832
Finisar Corp. *		15,800		413,170
FLIR Systems, Inc.		21,900		745,476
Frequency Electronics, Inc. *		500		5,328
Fusion-io, Inc. *		28,600		246,818
Harmonic, Inc. *		20,042		140,895
Harris Corp.		17,000		1,249,840
Hewlett-Packard Co.		322,336		10,656,428
Hutchinson Technology, Inc. *		6,000		16,680
I.D. Systems, Inc. *		5,500		30,965
Identive Group, Inc. *		1,200		1,020
II-VI, Inc. *		13,000		187,200
Imation Corp. *		5,500		23,760
Immersion Corp. *		4,300		48,762
Infinera Corp. *		27,300		244,608
Ingram Micro, Inc., Class A *		25,500		687,480
Insight Enterprises, Inc. *		8,950		233,774
Intellicheck Mobilisa, Inc. *		500		340
InterDigital, Inc.		6,700		232,624
InvenSense, Inc. *(c)		8,900		191,617
IPG Photonics Corp. *(c)		5,700		368,391
Itron, Inc. *		5,700		216,600

58 See financial notes

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Ixia *		14,900		185,058
Jabil Circuit, Inc.		27,700		478,102
JDS Uniphase Corp. *		44,553		564,487
Juniper Networks, Inc. *		84,165		2,078,034
Knowles Corp. *		13,900		388,227
Lexmark International, Inc., Class A		10,900		468,700
LightPath Technologies, Inc., Class A *		75		110
Littelfuse, Inc.		3,700		335,035
Maxwell Technologies, Inc. *		7,700		115,962
Measurement Specialties, Inc. *		3,200		205,920
Mercury Systems, Inc. *		7,800		108,888
Methode Electronics, Inc.		9,500		263,530
MOCON, Inc.		600		9,588
Motorola Solutions, Inc.		37,279		2,370,199
MTS Systems Corp.		3,781		243,761
Multi-Fineline Electronix, Inc. *		5,700		70,566
National Instruments Corp.		16,112		440,019
NCR Corp. *		27,500		839,025
NetApp, Inc.		55,900		1,990,599
NETGEAR, Inc. *		6,000		193,800
Newport Corp. *		8,500		158,780
Oplink Communications, Inc. *		5,957		102,103
OSI Systems, Inc. *		3,700		206,497
Palo Alto Networks, Inc. *		7,100		451,418
Park Electrochemical Corp.		3,600		95,976
PC Connection, Inc.		7,000		140,070
PC-Tel, Inc.		8,900		73,425
Plantronics, Inc.		6,000		261,420
Plexus Corp. *		6,500		272,480
Polycom, Inc. *		22,400		275,520
Pulse Electronics Corp. *		1,150		3,795
QLogic Corp. *		17,044		197,370
QUALCOMM, Inc.		285,400		22,463,834
Radisys Corp. *		7,200		23,040
Research Frontiers, Inc. *(c)		2,800		12,740
Richardson Electronics Ltd.		7,300		73,146
Riverbed Technology, Inc. *		26,700		519,315
Rofin-Sinar Technologies, Inc. *		3,800		84,360
Rogers Corp. *		4,200		252,084
SanDisk Corp.		39,500		3,356,315
Sanmina Corp. *		20,900		423,225
ScanSource, Inc. *		6,300		241,983
Seagate Technology plc		55,866		2,937,434
Sonus Networks, Inc. *		79,300		259,311
Super Micro Computer, Inc. *		8,200		166,952
SYNNEX Corp. *		3,600		242,568
TE Connectivity Ltd.		70,400		4,152,192
Tech Data Corp. *		5,300		331,197
Tessco Technologies, Inc.		4,025		132,382
Transact Technologies, Inc.		1,500		16,035
Trimble Navigation Ltd. *		42,584		1,636,503
TTM Technologies, Inc. *		11,000		86,790
Ubiquiti Networks, Inc. *		3,200		123,936
Universal Display Corp. *		5,800		151,090
ViaSat, Inc. *		6,500		417,365
Vishay Intertechnology, Inc.		18,588		264,321
Vishay Precision Group, Inc. *		5,620		91,213
Western Digital Corp.		34,700		3,058,111
Xybernaut Corp. *(b)(g)		1,400		—
Zebra Technologies Corp., Class A *		9,575		664,888
Zygo Corp. *		7,000		134,680
				209,247,967
Telecommunication Services 2.2%
Alaska Communications Systems Group, Inc. *		5,000		9,450
Alteva		1,100		6,655
AT&T, Inc.		878,856		31,375,159
Atlantic Tele-Network, Inc.		3,250		192,303
CenturyLink, Inc.		97,578		3,406,448
Cincinnati Bell, Inc. *		61,468		205,918
Cogent Communications Group, Inc.		9,900		341,253
Consolidated Communications Holdings, Inc.		13,353		265,992
Frontier Communications Corp.		165,068		982,155
General Communication, Inc., Class A *		10,500		109,620
HickoryTech Corp.		4,600		54,602
Iridium Communications, Inc. *		11,800		78,706
Level 3 Communications, Inc. *		26,306		1,131,947
Lumos Networks Corp.		1,500		19,815
NII Holdings, Inc. *		27,900		23,991
NTELOS Holdings Corp. (c)		4,500		62,055
Premiere Global Services, Inc. *		11,400		145,008
SBA Communications Corp., Class A *		21,700		1,947,792
Shenandoah Telecommunications Co.		7,100		199,013
Sprint Corp. *		142,805		1,213,842
T-Mobile US, Inc. *		41,550		1,216,999
Telephone & Data Systems, Inc.		14,222		386,696
tw telecom, Inc. *		21,600		662,904
United States Cellular Corp.		5,400		224,316
USA Mobility, Inc.		5,500		94,215
Verizon Communications, Inc.		698,972		32,662,962
Vonage Holdings Corp. *		36,400		139,776
Windstream Holdings, Inc. (c)		109,269		991,070
				78,150,662
Transportation 2.0%
Alaska Air Group, Inc.		10,900		1,025,472
Allegiant Travel Co.		2,000		234,900
AMERCO		1,000		250,110
American Airlines Group, Inc. *		30,800		1,080,156
ArcBest Corp.		4,800		189,216
Atlas Air Worldwide Holdings, Inc. *		6,500		227,435
Avis Budget Group, Inc. *		17,500		920,325
C.H. Robinson Worldwide, Inc.		26,000		1,531,400
Con-way, Inc.		11,200		475,776
Covenant Transport Group, Inc., Class A *		3,000		30,750
CSX Corp.		172,700		4,873,594
Delta Air Lines, Inc.		141,300		5,204,079
Expeditors International of Washington, Inc.		33,700		1,389,788
FedEx Corp.		49,163		6,698,459

See financial notes 59

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Forward Air Corp.		4,600		203,458
Genesee & Wyoming, Inc., Class A *		9,000		891,090
Heartland Express, Inc.		16,241		353,404
Hertz Global Holdings, Inc. *		78,300		2,229,201
Hub Group, Inc., Class A *		7,100		317,015
J.B. Hunt Transport Services, Inc.		15,600		1,187,160
JetBlue Airways Corp. *		30,962		244,755
Kansas City Southern		17,950		1,810,796
Kirby Corp. *		9,400		945,828
Knight Transportation, Inc.		14,650		347,644
Landstar System, Inc.		6,600		415,734
Matson, Inc.		10,500		248,745
Norfolk Southern Corp.		52,600		4,972,278
Old Dominion Freight Line, Inc. *		12,412		752,540
Park-Ohio Holdings Corp. *		3,600		210,204
Republic Airways Holdings, Inc. *		12,500		103,875
Roadrunner Transportation Systems, Inc. *		4,900		120,687
Ryder System, Inc.		9,500		780,710
Saia, Inc. *		4,450		183,206
SkyWest, Inc.		7,000		81,200
Southwest Airlines Co.		118,615		2,866,925
Spirit Airlines, Inc. *		11,500		653,660
Swift Transportation Co. *		19,000		456,950
Union Pacific Corp.		76,900		14,644,067
United Continental Holdings, Inc. *		62,700		2,562,549
United Parcel Service, Inc., Class B		119,980		11,818,030
Universal Truckload Services, Inc.		3,300		81,378
UTI Worldwide, Inc.		14,600		142,934
Werner Enterprises, Inc.		10,032		256,819
Wesco Aircraft Holdings, Inc. *		13,500		273,510
XPO Logistics, Inc. *		6,810		184,823
				74,472,635
Utilities 3.1%
AES Corp.		108,396		1,566,322
AGL Resources, Inc.		18,629		1,005,966
ALLETE, Inc.		5,233		270,860
Alliant Energy Corp.		18,300		1,070,184
Ameren Corp.		39,300		1,623,483
American DG Energy, Inc. *(c)		11,400		27,930
American Electric Power Co., Inc.		83,420		4,488,830
American States Water Co.		9,600		291,456
American Water Works Co., Inc.		29,100		1,324,923
Aqua America, Inc.		29,167		731,800
Artesian Resources Corp., Class A		4,000		88,080
Atmos Energy Corp.		17,400		888,096
Avista Corp.		7,800		250,770
Black Hills Corp.		7,700		444,675
Cadiz, Inc. *(c)		6,356		40,869
California Water Service Group		11,300		254,250
Calpine Corp. *		57,800		1,325,354
CenterPoint Energy, Inc.		70,800		1,753,008
Chesapeake Utilities Corp.		1,847		116,841
Cleco Corp.		11,700		614,835
CMS Energy Corp.		43,500		1,318,485
Connecticut Water Service, Inc.		5,100		165,750
Consolidated Edison, Inc.		50,400		2,924,712
Delta Natural Gas Co., Inc.		1,291		24,619
Dominion Resources, Inc.		98,180		7,121,977
DTE Energy Co.		28,901		2,258,324
Duke Energy Corp.		119,273		8,884,646
Dynegy, Inc. *		17,000		483,650
Edison International		56,210		3,179,238
El Paso Electric Co.		5,300		200,446
Entergy Corp.		29,400		2,131,500
Exelon Corp.		146,369		5,127,306
FirstEnergy Corp.		72,856		2,458,890
Genie Energy Ltd., Class B *		12,800		103,680
Great Plains Energy, Inc.		25,341		679,899
Hawaiian Electric Industries, Inc.		19,300		463,007
IDACORP, Inc.		9,800		550,172
Integrys Energy Group, Inc.		12,540		768,451
ITC Holdings Corp.		25,800		953,826
MDU Resources Group, Inc.		29,825		1,056,402
MGE Energy, Inc.		4,950		189,189
Middlesex Water Co.		9,400		191,102
National Fuel Gas Co.		13,800		1,016,232
New Jersey Resources Corp.		6,225		309,569
NextEra Energy, Inc.		73,500		7,338,975
NiSource, Inc.		51,764		1,880,069
Northeast Utilities		51,943		2,454,826
Northwest Natural Gas Co.		6,300		278,901
NorthWestern Corp.		7,100		343,498
NRG Energy, Inc.		57,356		1,876,688
OGE Energy Corp.		32,800		1,224,424
ONE Gas, Inc.		8,525		311,845
Ormat Technologies, Inc.		8,600		229,448
Otter Tail Corp.		7,800		228,540
Pepco Holdings, Inc.		41,200		1,102,512
PG&E Corp.		77,600		3,537,008
Piedmont Natural Gas Co., Inc.		12,300		440,217
Pinnacle West Capital Corp.		18,200		1,018,290
PNM Resources, Inc.		11,200		310,016
Portland General Electric Co.		10,900		364,823
PPL Corp.		106,800		3,560,712
Public Service Enterprise Group, Inc.		86,300		3,535,711
Pure Cycle Corp. *		8,000		44,880
Questar Corp.		28,900		701,692
SCANA Corp.		23,205		1,245,644
Sempra Energy		37,575		3,705,271
SJW Corp.		4,470		121,718
South Jersey Industries, Inc.		4,200		241,290
Southwest Gas Corp.		6,500		357,565
TECO Energy, Inc.		32,100		576,516
The Empire District Electric Co.		11,200		272,384
The Laclede Group, Inc.		5,800		274,978
The Southern Co.		149,900		6,869,917
UGI Corp.		18,600		868,434
UIL Holdings Corp.		11,166		410,127
Unitil Corp.		7,200		239,040
UNS Energy Corp.		8,200		492,492
Vectren Corp.		15,266		619,342
Westar Energy, Inc.		21,000		753,480
WGL Holdings, Inc.		7,300		290,467
Wisconsin Energy Corp.		38,200		1,851,936
Xcel Energy, Inc.		82,195		2,619,555

60 See financial notes

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
York Water Co.		6,100		122,061
				113,454,896
Total Common Stock
(Cost $2,186,360,928)				3,522,081,897
Rights 0.0% of net assets
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
FRD Acquisition Co. CVR *(b)(g)		8,700		—
Technology Hardware & Equipment 0.0%
Gerber Scientific, Inc. CVR *(b)(g)		8,900		—
Telecommunication Services 0.0%
Contra Leap Wireless CVR *(b)(g)		13,000		32,760
Total Rights
(Cost $32,982)				32,760
Warrants 0.0% of net assets
Energy 0.0%
Magnum Hunter Resources Corp. *(b)(g)		2,293		—
Total Warrants
(Cost $—)				—
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 2.8% of net assets
Time Deposit 2.6%
Australia & New Zealand Banking Group Ltd.
0.03%, 05/01/14		95,893,627		95,893,627
U.S. Treasury Obligation 0.2%
U.S. Treasury Bill
0.05%, 06/19/14 (d)(e)		6,000,000		5,999,592
Total Short-Term Investments
(Cost $101,893,219)				101,893,219
End of Investments.
	Number		Value
Security	of Shares		($)
Collateral Invested for Securities on Loan 0.7% of net assets
Wells Fargo Advantage Government Money Market Fund, Institutional Class 0.01% (f)		26,681,531		26,681,531
Total Collateral Invested for Securities on Loan
(Cost $26,681,531)				26,681,531
End of collateral invested for securities on loan.

At 04/30/14 tax basis cost of the fund’s investments was $2,302,453,550 and the unrealized appreciation and depreciation were $1,391,997,727 and ($70,443,401), respectively, with a net unrealized appreciation of $1,321,554,326.

*	Non-income producing security.
(a)	Issuer is affiliated with the fund’s adviser.
(b)	Illiquid security. At the period end, the value of these amounted to $32,760 or 0.0% of net assets.
(c)	All or a portion of this security is on loan. Securities on loan were valued at $26,212,591.
(d)	All or a portion of this security is held as collateral for open futures contracts.
(e)	The rate shown is the purchase yield.
(f)	The rate shown is the 7-day yield.
(g)	Fair-valued by management in accordance with procedures approved by the Board of Trustees.

CVR —	Contingent Value Rights
REIT —	Real Estate Investment Trust

In addition to the above, the fund held the following at 04/30/14:

					Unrealized
			Contract		Appreciation
	Number of		Value		(Depreciation)
	Contracts		($)		($)
Futures Contracts
Russell 2000 Index, mini, Long, expires 06/20/14		140		15,730,400		(387,687	)
S&P 500 Index, e-mini, Long, expires 06/20/14		960		90,139,200		1,414,538
Net Unrealized Appreciation						1,026,851

See financial notes 61

 Schwab International Index Fund

Portfolio Holdings as of April 30, 2014 (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%	Common Stock		1,795,245,659		2,420,335,392
	0	.6%	Preferred Stock		9,585,888		15,506,942
	0	.0%	Rights		429,850		617,551
	0	.0%	Warrants		—		15,968
	0	.4%	Other Investment Company		8,089,400		9,564,800
	1	.8%	Short-Term Investments		43,356,422		43,356,422
	99	.6%	Total Investments		1,856,707,219		2,489,397,075
	1	.6%	Collateral Invested for Securities on Loan		39,582,384		39,582,384
	(1	.2%)	Other Assets and Liabilities, Net				(29,524,528	)
	100	.0%	Net Assets				2,499,454,931

		Number		Value
Security		of Shares		($)
Common Stock 96.8% of net assets
Australia 7.8%
Banks 2.9%
Australia & New Zealand Banking Group Ltd.			499,603		16,066,120
Bank of Queensland Ltd.			64,129		733,156
Bendigo & Adelaide Bank Ltd.			75,987		814,400
Commonwealth Bank of Australia			293,519		21,591,519
National Australia Bank Ltd.			427,816		14,086,858
Westpac Banking Corp.			566,132		18,543,378
					71,835,431
Capital Goods 0.0%
Leighton Holdings Ltd. (a)			33,382		593,605
Commercial & Professional Supplies 0.2%
ALS Ltd.			65,668		459,282
Brambles Ltd.			285,047		2,506,495
Seek Ltd.			62,241		974,807
					3,940,584
Consumer Services 0.1%
Crown Resorts Ltd.			71,852		1,075,174
Echo Entertainment Group Ltd.			135,161		355,499
Flight Centre Travel Group Ltd.			11,202		561,827
Tabcorp Holdings Ltd.			122,573		424,796
Tatts Group Ltd.			265,227		745,971
					3,163,267
Diversified Financials 0.2%
ASX Ltd.			36,129		1,195,580
Macquarie Group Ltd.			52,593		2,833,495
					4,029,075
Energy 0.4%
Caltex Australia Ltd.			27,417		569,132
Origin Energy Ltd.			204,972		2,847,449
Santos Ltd.			177,202		2,271,971
Woodside Petroleum Ltd.			121,458		4,616,755
WorleyParsons Ltd.			35,418		555,409
					10,860,716
Food & Staples Retailing 0.7%
Metcash Ltd.			151,758		391,933
Wesfarmers Ltd.			208,181		8,285,415
Woolworths Ltd.			228,425		7,938,219
					16,615,567
Food, Beverage & Tobacco 0.1%
Coca-Cola Amatil Ltd.			107,769		930,342
Treasury Wine Estates Ltd.			125,835		448,140
					1,378,482
Health Care Equipment & Services 0.1%
Cochlear Ltd.			11,235		614,139
Ramsay Health Care Ltd.			24,832		1,037,580
Sonic Healthcare Ltd.			69,642		1,148,756
	��				2,800,475
Insurance 0.4%
AMP Ltd.			528,240		2,485,981
Insurance Australia Group Ltd.			410,236		2,192,612
QBE Insurance Group Ltd.			225,667		2,435,541
Suncorp Group Ltd.			239,120		2,903,917
					10,018,051
Materials 1.4%
Alumina Ltd. *			414,010		520,056
Amcor Ltd.			224,446		2,154,000
BHP Billiton Ltd.			584,822		20,595,440
Boral Ltd.			130,425		692,188
Fortescue Metals Group Ltd.			275,330		1,302,293
Iluka Resources Ltd.			73,547		611,014
Incitec Pivot Ltd.			301,643		809,691
James Hardie Industries plc CDI			81,856		1,050,884
Newcrest Mining Ltd. *			142,749		1,392,256
Orica Ltd.			68,969		1,407,554
Rio Tinto Ltd.			79,348		4,575,935
					35,111,311
Media 0.0%
REA Group Ltd.			8,785		383,136
Pharmaceuticals, Biotechnology & Life Sciences 0.2%
CSL Ltd.			89,069		5,678,177
Real Estate 0.6%
CFS Retail Property Trust Group			363,022		679,653
Dexus Property Group			975,748		1,032,267
Federation Centres Ltd.			246,002		571,040
Goodman Group			300,988		1,398,074

62 See financial notes

 Schwab International Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
GPT Group		287,272		1,048,350
Lend Lease Group		100,371		1,213,083
Mirvac Group		667,190		1,088,754
Stockland		397,313		1,440,312
Westfield Group		357,905		3,652,156
Westfield Retail Trust		516,243		1,533,746
				13,657,435
Retailing 0.0%
Harvey Norman Holdings Ltd.		91,526		280,111
Software & Services 0.0%
Computershare Ltd.		81,530		939,773
Telecommunication Services 0.2%
Telstra Corp., Ltd.		793,023		3,855,762
Transportation 0.2%
Asciano Ltd.		172,860		872,317
Aurizon Holdings Ltd.		392,053		1,892,919
Qantas Airways Ltd. *		268,959		305,950
Sydney Airport		192,713		757,261
Toll Holdings Ltd.		111,390		549,442
Transurban Group (b)		258,976		1,749,080
				6,126,969
Utilities 0.1%
AGL Energy Ltd.		106,046		1,556,752
APA Group		152,130		942,952
SP AusNet		290,894		379,080
				2,878,784
				194,146,711
Austria 0.3%
Banks 0.1%
Erste Group Bank AG		48,012		1,614,372
Raiffeisen Bank International AG		20,004		632,338
				2,246,710
Capital Goods 0.0%
Andritz AG		12,691		788,354
Energy 0.1%
OMV AG		26,782		1,252,177
Insurance 0.0%
Vienna Insurance Group AG Wiener Versicherung Gruppe		6,791		363,197
Materials 0.1%
Voestalpine AG		21,074		962,647
Real Estate 0.0%
IMMOFINANZ AG *		165,354		612,967
Telecommunication Services 0.0%
Telekom Austria AG		37,970		376,817
				6,602,869
Belgium 1.2%
Banks 0.1%
KBC Groep N.V.		45,992		2,806,564
Diversified Financials 0.1%
Groupe Bruxelles Lambert S.A.		14,375		1,453,455
Food & Staples Retailing 0.1%
Colruyt S.A.		13,008		735,545
Delhaize Group S.A.		18,914		1,408,398
				2,143,943
Food, Beverage & Tobacco 0.6%
Anheuser-Busch InBev N.V.		146,333		15,949,688
Insurance 0.1%
Ageas		39,029		1,679,641
Materials 0.1%
Solvay S.A.		11,005		1,783,416
Umicore S.A.		19,644		962,923
				2,746,339
Media 0.0%
Telenet Group Holding N.V.		9,411		551,565
Pharmaceuticals, Biotechnology & Life Sciences 0.1%
UCB S.A.		20,357		1,669,815
Telecommunication Services 0.0%
Belgacom S.A. (a)		28,150		861,602
				29,862,612
Denmark 1.3%
Banks 0.1%
Danske Bank A/S		116,888		3,307,138
Food, Beverage & Tobacco 0.1%
Carlsberg A/S, Class B		19,802		1,980,840
Health Care Equipment & Services 0.1%
Coloplast A/S, Class B		19,741		1,658,105
William Demant Holding A/S *		4,937		442,415
				2,100,520
Insurance 0.0%
Tryg A/S		4,412		419,024
Materials 0.1%
Novozymes A/S, B Shares		41,556		1,992,406
Pharmaceuticals, Biotechnology & Life Sciences 0.6%
Novo Nordisk A/S, Class B		362,601		16,457,003
Telecommunication Services 0.1%
TDC A/S		146,148		1,371,835
Transportation 0.2%
AP Moeller - Maersk A/S, Series A		530		1,204,089
AP Moeller - Maersk A/S, Series B		1,201		2,867,097
DSV A/S		31,001		1,035,408
				5,106,594
				32,735,360
Finland 0.9%
Automobiles & Components 0.1%
Nokian Renkaat Oyj (a)		20,943		833,403
Capital Goods 0.2%
Kone Oyj, Class B		56,345		2,415,253
Metso Oyj		24,814		998,757
Wartsila Oyj Abp		31,620		1,765,186
				5,179,196

See financial notes 63

 Schwab International Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Energy 0.0%
Neste Oil Oyj		21,550		442,481
Insurance 0.2%
Sampo Oyj, A Shares		81,402		4,045,643
Materials 0.1%
Stora Enso Oyj, R Shares		100,350		1,024,735
UPM-Kymmene Oyj		98,045		1,717,140
				2,741,875
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
Orion Oyj, Class B		18,887		576,482
Technology Hardware & Equipment 0.2%
Nokia Oyj *		674,647		5,051,467
Telecommunication Services 0.0%
Elisa Oyj		24,569		733,867
Utilities 0.1%
Fortum Oyj		82,282		1,858,922
				21,463,336
France 10.2%
Automobiles & Components 0.4%
Compagnie Generale des Etablissements Michelin		34,085		4,179,869
Renault S.A.		35,091		3,430,842
Valeo S.A.		13,888		1,907,228
				9,517,939
Banks 1.0%
BNP Paribas S.A.		181,285		13,622,564
Credit Agricole S.A. *		179,062		2,825,320
Natixis		159,730		1,133,868
Societe Generale S.A.		130,886		8,151,212
				25,732,964
Capital Goods 1.7%
Airbus Group N.V.		106,877		7,346,737
Alstom S.A.		40,852		1,688,168
Bouygues S.A. (a)		34,535		1,555,488
Compagnie de Saint-Gobain		75,095		4,600,728
Legrand S.A.		47,500		3,069,263
Rexel S.A.		42,488		1,072,812
Safran S.A.		49,782		3,350,435
Schneider Electric S.A.		99,991		9,386,247
Thales S.A.		16,565		1,054,780
Vallourec S.A.		18,721		1,106,327
Vinci S.A. (a)		87,599		6,614,278
Zodiac Aerospace		32,627		1,084,771
				41,930,034
Commercial & Professional Supplies 0.1%
Bureau Veritas S.A.		40,137		1,229,986
Edenred		35,989		1,216,385
Societe BIC S.A.		4,998		663,099
				3,109,470
Consumer Durables & Apparel 0.6%
Christian Dior S.A.		10,081		2,074,224
Kering		13,966		3,088,879
LVMH Moet Hennessy Louis Vuitton S.A.		46,223		9,105,664
				14,268,767
Consumer Services 0.1%
Accor S.A.		29,671		1,452,679
Sodexo		17,503		1,887,083
				3,339,762
Diversified Financials 0.1%
Eurazeo S.A.		6,442		543,054
Wendel S.A.		5,814		876,434
				1,419,488
Energy 1.2%
CGG S.A. *		26,877		465,020
Technip S.A.		18,622		2,096,066
Total S.A.		389,505		27,866,807
				30,427,893
Food & Staples Retailing 0.2%
Carrefour S.A.		112,057		4,368,099
Casino Guichard Perrachon S.A.		10,349		1,318,703
				5,686,802
Food, Beverage & Tobacco 0.5%
Danone S.A.		103,414		7,635,990
Pernod-Ricard S.A.		38,665		4,640,126
Remy Cointreau S.A.		5,148		452,736
				12,728,852
Health Care Equipment & Services 0.2%
Essilor International S.A.		37,275		3,991,680
Household & Personal Products 0.3%
L’Oreal S.A.		44,034		7,589,044
Insurance 0.4%
AXA S.A. (a)		326,847		8,529,402
CNP Assurances		33,282		767,800
SCOR SE		29,475		1,078,572
				10,375,774
Materials 0.6%
Air Liquide S.A.		56,967		8,150,125
ArcelorMittal		183,724		2,987,579
Arkema S.A.		11,207		1,251,734
Imerys S.A.		5,580		490,019
Lafarge S.A.		34,087		3,118,921
				15,998,378
Media 0.3%
Eutelsat Communications S.A.		25,025		860,824
JC Decaux S.A.		12,016		493,258
Lagardere S.C.A. (a)		20,262		849,191
Publicis Groupe S.A.		33,334		2,851,699
SES S.A.		55,021		2,072,069
				7,127,041
Pharmaceuticals, Biotechnology & Life Sciences 0.9%
Sanofi		217,578		23,480,983
Real Estate 0.3%
Fonciere des Regions		5,116		519,656
Gecina S.A.		4,219		567,886
ICADE		6,374		650,328
Klepierre		17,099		784,518
Unibail-Rodamco SE		17,707		4,785,216
				7,307,604

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.		109,832		1,047,379
Software & Services 0.2%
AtoS		12,529		1,082,405
Cap Gemini S.A.		26,705		1,886,807
Dassault Systemes S.A.		11,105		1,366,558
				4,335,770
Technology Hardware & Equipment 0.1%
Alcatel-Lucent *		501,265		1,987,877
Telecommunication Services 0.5%
Iliad S.A.		4,915		1,326,261
Orange S.A.		339,659		5,502,907
Vivendi S.A. *		219,442		5,895,694
				12,724,862
Transportation 0.1%
Aeroports de Paris		5,551		690,299
Groupe Eurotunnel S.A. - Reg’d		95,309		1,279,506
				1,969,805
Utilities 0.4%
Electricite de France		44,723		1,717,404
GDF Suez (a)		245,218		6,180,333
Suez Environnement Co.		48,547		953,925
Veolia Environnement S.A. (a)		63,025		1,175,788
				10,027,450
				256,125,618
Germany 8.6%
Automobiles & Components 1.2%
Bayerische Motoren Werke AG		60,090		7,553,610
Continental AG		20,031		4,713,386
Daimler AG - Reg’d		175,310		16,321,207
Volkswagen AG		5,226		1,401,344
				29,989,547
Banks 0.1%
Commerzbank AG *		178,431		3,181,632
Capital Goods 1.0%
Brenntag AG		9,077		1,644,302
GEA Group AG		33,966		1,521,281
Hochtief AG		5,074		473,077
MAN SE		7,010		898,897
OSRAM Licht AG *		16,162		848,494
Siemens AG - Reg’d		144,381		19,046,775
				24,432,826
Consumer Durables & Apparel 0.2%
adidas AG		38,097		4,072,633
Hugo Boss AG		5,413		752,016
				4,824,649
Diversified Financials 0.4%
Deutsche Bank AG - Reg’d		185,642		8,176,689
Deutsche Boerse AG		35,862		2,629,864
				10,806,553
Food & Staples Retailing 0.0%
Metro AG *		23,809		953,878
Food, Beverage & Tobacco 0.0%
Suedzucker AG (a)		16,268		347,631
Health Care Equipment & Services 0.3%
Celesio AG		15,063		523,505
Fresenius Medical Care AG & Co. KGaA		39,746		2,738,402
Fresenius SE & Co. KGaA		22,759		3,462,843
				6,724,750
Household & Personal Products 0.2%
Beiersdorf AG		18,229		1,829,911
Henkel AG & Co. KGaA		23,300		2,395,666
				4,225,577
Insurance 0.9%
Allianz SE - Reg’d		83,125		14,466,231
Hannover Rueck SE		11,074		1,031,896
Muenchener Rueckversicherungs AG - Reg’d (a)		32,657		7,548,957
				23,047,084
Materials 1.3%
BASF SE		167,247		19,401,607
HeidelbergCement AG		25,664		2,229,896
K&S AG - Reg’d		29,563		1,035,891
LANXESS AG		15,844		1,206,543
Linde AG		33,805		7,020,784
ThyssenKrupp AG *		81,414		2,323,732
				33,218,453
Media 0.2%
Axel Springer SE		6,956		424,746
Kabel Deutschland Holding AG		3,895		527,512
ProSiebenSat.1 Media AG - Reg’d		38,605		1,689,657
RTL Group S.A. *		7,403		824,325
Sky Deutschland AG *		73,136		627,658
				4,093,898
Pharmaceuticals, Biotechnology & Life Sciences 1.0%
Bayer AG - Reg’d		150,580		20,936,895
Merck KGaA		11,876		2,007,564
QIAGEN N.V. *		39,873		875,359
				23,819,818
Real Estate 0.0%
Deutsche Wohnen AG		50,000		1,073,370
Semiconductors & Semiconductor Equipment 0.1%
Infineon Technologies AG		193,715		2,252,379
Software & Services 0.6%
SAP AG		167,775		13,560,752
United Internet AG - Reg’d		19,167		823,398
				14,384,150
Telecommunication Services 0.4%
Deutsche Telekom AG - Reg’d		526,839		8,851,452
Telefonica Deutschland Holding AG		48,116		400,298
				9,251,750
Transportation 0.3%
Deutsche Lufthansa AG - Reg’d		40,146		1,008,180
Deutsche Post AG - Reg’d		165,910		6,260,273

See financial notes 65

 Schwab International Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Fraport AG Frankfurt Airport Services Worldwide		6,036		446,405
				7,714,858
Utilities 0.4%
E.ON SE		327,929		6,281,430
RWE AG		89,113		3,400,648
				9,682,078
				214,024,881
Hong Kong 2.7%
Banks 0.2%
Bank of East Asia Ltd.		237,200		979,844
BOC Hong Kong (Holdings) Ltd.		658,500		1,932,152
Hang Seng Bank Ltd.		141,636		2,312,355
				5,224,351
Capital Goods 0.2%
Hopewell Holdings Ltd.		119,500		412,120
Hutchison Whampoa Ltd.		388,370		5,328,240
NWS Holdings Ltd.		253,000		433,885
				6,174,245
Consumer Durables & Apparel 0.1%
Li & Fung Ltd.		1,008,000		1,467,221
Yue Yuen Industrial Holdings Ltd.		128,000		396,548
				1,863,769
Consumer Services 0.4%
Galaxy Entertainment Group Ltd. *		382,000		3,015,573
MGM China Holdings Ltd.		183,200		640,134
Sands China Ltd.		440,800		3,236,248
Shangri-La Asia Ltd.		270,000		445,824
SJM Holdings Ltd.		346,000		962,548
Wynn Macau Ltd.		286,000		1,131,865
				9,432,192
Diversified Financials 0.2%
First Pacific Co., Ltd.		383,250		426,181
Hong Kong Exchanges & Clearing Ltd.		200,918		3,613,173
				4,039,354
Insurance 0.4%
AIA Group Ltd.		2,193,200		10,666,833
Real Estate 0.8%
Cheung Kong (Holdings) Ltd.		254,656		4,348,854
Hang Lung Properties Ltd.		390,000		1,163,232
Henderson Land Development Co., Ltd.		195,900		1,170,984
Hysan Development Co., Ltd.		125,000		536,108
Kerry Properties Ltd.		121,000		398,454
New World Development Co., Ltd.		870,666		900,793
Sino Land Co., Ltd.		542,000		812,723
Sun Hung Kai Properties Ltd.		292,604		3,692,089
Swire Pacific Ltd., Class A		130,090		1,502,474
Swire Properties Ltd.		216,600		652,304
The Link REIT		411,000		2,046,260
Wharf Holdings Ltd.		282,100		1,980,374
Wheelock & Co., Ltd.		162,000		668,676
				19,873,325
Semiconductors & Semiconductor Equipment 0.0%
ASM Pacific Technology Ltd.		53,000		589,273
Telecommunication Services 0.0%
HKT Trust & HKT Ltd.		425,000		445,580
PCCW Ltd.		759,000		405,299
				850,879
Transportation 0.1%
Cathay Pacific Airways Ltd.		201,000		379,868
MTR Corp., Ltd.		250,000		944,718
				1,324,586
Utilities 0.3%
Cheung Kong Infrastructure Holdings Ltd.		114,000		744,996
CLP Holdings Ltd.		322,080		2,574,848
Hong Kong & China Gas Co., Ltd.		1,014,634		2,341,173
Power Assets Holdings Ltd.		259,000		2,238,890
				7,899,907
				67,938,714
Ireland 0.3%
Banks 0.1%
Bank of Ireland *		4,050,099		1,581,367
Food, Beverage & Tobacco 0.1%
Kerry Group plc, Class A		27,277		2,153,251
Materials 0.1%
CRH plc		133,518		3,887,184
Transportation 0.0%
Ryanair Holdings plc *		35,363		335,333
				7,957,135
Israel 0.5%
Banks 0.1%
Bank Hapoalim B.M.		182,922		1,033,325
Bank Leumi Le-Israel B.M. *		213,157		834,035
Mizrahi Tefahot Bank Ltd.		20,764		277,570
				2,144,930
Energy 0.0%
Delek Group Ltd.		790		320,179
Materials 0.1%
Israel Chemicals Ltd.		85,438		758,284
The Israel Corp., Ltd. *		609		343,896
				1,102,180
Pharmaceuticals, Biotechnology & Life Sciences 0.3%
Teva Pharmaceutical Industries Ltd.		155,143		7,605,104
Software & Services 0.0%
NICE Systems Ltd.		11,048		478,140

66 See financial notes

 Schwab International Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Telecommunication Services 0.0%
Bezeq The Israeli Telecommunication Corp., Ltd.		328,894		596,030
				12,246,563
Italy 2.6%
Automobiles & Components 0.1%
Fiat S.p.A. *		161,562		1,950,494
Pirelli & C. S.p.A		45,863		772,156
				2,722,650
Banks 0.7%
Banca Monte dei Paschi di Siena S.p.A. *		1,107,091		370,013
Banco Popolare SC *		48,000		991,988
Intesa Sanpaolo S.p.A.		2,117,023		7,244,514
UniCredit S.p.A.		790,625		7,083,718
Unione di Banche Italiane S.C.P.A.		158,997		1,517,704
				17,207,937
Capital Goods 0.1%
CNH Industrial N.V.		174,194		2,034,789
Finmeccanica S.p.A. *		70,375		651,281
Prysmian S.p.A.		39,039		1,016,759
				3,702,829
Consumer Durables & Apparel 0.1%
Luxottica Group S.p.A.		31,091		1,783,271
Diversified Financials 0.1%
Exor S.p.A.		18,034		824,262
Mediobanca S.p.A. *		97,780		1,085,267
				1,909,529
Energy 0.6%
Eni S.p.A.		463,229		11,997,314
Saipem S.p.A.		47,315		1,269,126
Tenaris S.A.		89,011		1,967,662
				15,234,102
Insurance 0.2%
Assicurazioni Generali S.p.A.		212,620		4,971,329
UnipolSai S.p.A. *		150,000		551,934
				5,523,263
Telecommunication Services 0.1%
Telecom Italia S.p.A. *		1,794,154		2,305,539
Telecom Italia S.p.A. - RSP		1,038,385		1,032,127
				3,337,666
Transportation 0.1%
Atlantia S.p.A.		67,136		1,748,821
Utilities 0.5%
Enel Green Power S.p.A.		301,549		863,034
Enel S.p.A.		1,213,056		6,870,664
Snam S.p.A.		363,943		2,189,097
Terna - Rete Elettrica Nationale S.p.A.		263,586		1,428,026
				11,350,821
				64,520,889
Japan 18.5%
Automobiles & Components 2.6%
Aisin Seiki Co., Ltd.		36,200		1,279,285
Bridgestone Corp.		118,457		4,241,411
Daihatsu Motor Co., Ltd.		33,000		546,609
Denso Corp.		90,000		4,099,751
Fuji Heavy Industries Ltd.		108,400		2,850,342
Honda Motor Co., Ltd.		296,839		9,850,503
Isuzu Motors Ltd.		207,000		1,202,163
Koito Manufacturing Co., Ltd.		18,000		391,492
Mazda Motor Corp.		480,000		2,146,196
Mitsubishi Motors Corp.		117,900		1,277,836
NGK Spark Plug Co., Ltd.		31,000		709,733
NHK Spring Co., Ltd.		23,800		215,435
Nissan Motors Co., Ltd.		448,496		3,869,891
NOK Corp.		20,800		340,055
Stanley Electric Co., Ltd.		27,000		598,427
Sumitomo Rubber Industries Ltd.		27,100		376,632
Suzuki Motor Corp.		67,300		1,736,344
The Yokohama Rubber Co., Ltd.		36,000		321,552
Toyoda Gosei Co., Ltd.		11,300		208,212
Toyota Boshoku Corp. (a)		24,000		248,096
Toyota Industries Corp.		31,200		1,438,257
Toyota Motor Corp.		502,303		27,138,502
Yamaha Motor Co., Ltd.		51,400		793,451
				65,880,175
Banks 1.8%
Aozora Bank Ltd.		185,000		550,338
Fukuoka Financial Group, Inc.		147,000		600,349
Hokuhoku Financial Group, Inc.		223,000		430,332
Mitsubishi UFJ Financial Group, Inc.		2,321,209		12,347,657
Mizuho Financial Group, Inc.		4,186,534		8,199,775
Resona Holdings, Inc.		389,600		1,992,025
Seven Bank Ltd.		116,700		442,435
Shinsei Bank Ltd.		291,000		567,340
Sumitomo Mitsui Financial Group, Inc.		231,746		9,160,990
Sumitomo Mitsui Trust Holdings, Inc.		591,000		2,435,332
Suruga Bank Ltd.		34,000		583,235
The Bank of Kyoto Ltd.		53,000		431,846
The Bank of Yokohama Ltd.		203,000		1,020,297
The Chiba Bank Ltd.		129,000		819,977
The Chugoku Bank Ltd.		32,500		430,832
The Gunma Bank Ltd.		72,000		382,700
The Hachijuni Bank Ltd.		77,000		420,954
The Hiroshima Bank Ltd.		92,000		378,510
The Iyo Bank Ltd.		46,000		413,587
The Joyo Bank Ltd.		108,000		525,646
The Nishi-Nippon City Bank Ltd.		117,000		266,128
The Shizuoka Bank Ltd.		98,000		936,391
Yamaguchi Financial Group, Inc.		38,000		350,429
				43,687,105
Capital Goods 2.7%
Amada Co., Ltd.		60,000		433,932
Asahi Glass Co., Ltd.		174,000		986,472

See financial notes 67

 Schwab International Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Chiyoda Corp.		29,000		388,882
Daikin Industries Ltd.		42,800		2,475,728
Fanuc Corp.		34,900		6,297,213
Fuji Electric Co., Ltd.		104,000		471,981
Hino Motors Ltd.		44,000		579,662
Hitachi Construction Machinery Co., Ltd.		17,500		324,740
IHI Corp.		228,000		909,090
ITOCHU Corp.		274,500		3,077,087
JGC Corp.		37,000		1,198,112
JTEKT Corp.		36,900		538,389
Kajima Corp.		170,000		647,276
Kawasaki Heavy Industries Ltd.		245,000		909,331
Kinden Corp.		30,000		276,189
Komatsu Ltd.		169,309		3,727,553
Kubota Corp.		197,000		2,539,039
Kurita Water Industries Ltd.		18,200		383,294
LIXIL Group Corp.		48,100		1,274,646
Mabuchi Motor Co., Ltd.		4,400		301,297
Makita Corp.		21,400		1,138,231
Marubeni Corp.		294,000		1,964,629
Mitsubishi Corp.		255,900		4,582,478
Mitsubishi Electric Corp.		348,000		3,962,618
Mitsubishi Heavy Industries Ltd.		555,000		2,922,044
Mitsui & Co., Ltd.		314,100		4,454,682
Nabtesco Corp.		18,500		399,384
NGK Insulators Ltd.		46,000		869,904
Nidec Corp.		38,100		2,154,002
NSK Ltd.		86,000		904,096
Obayashi Corp.		108,000		697,344
Shimizu Corp.		98,000		555,527
SMC Corp.		9,200		2,190,113
Sojitz Corp.		215,700		340,120
Sumitomo Corp.		204,400		2,653,211
Sumitomo Electric Industries Ltd.		138,200		1,912,850
Sumitomo Heavy Industries Ltd.		102,000		434,000
Taisei Corp.		178,000		825,202
The Japan Steel Works Ltd.		54,000		228,157
THK Co., Ltd.		20,700		437,525
Toshiba Corp.		716,178		2,805,171
TOTO Ltd.		53,000		749,704
Toyota Tsusho Corp.		41,300		1,087,809
				66,008,714
Commercial & Professional Supplies 0.2%
Dai Nippon Printing Co., Ltd.		101,000		909,743
Park24 Co., Ltd.		18,000		329,024
Secom Co., Ltd.		38,800		2,227,628
Toppan Printing Co., Ltd.		97,000		666,181
				4,132,576
Consumer Durables & Apparel 0.7%
Asics Corp.		27,600		537,188
Casio Computer Co., Ltd.		41,300		471,284
Iida Group Holdings Co., Ltd.		25,100		374,576
Namco Bandai Holdings, Inc.		31,100		671,919
Nikon Corp.		61,900		970,497
Panasonic Corp.		404,812		4,412,474
Rinnai Corp.		6,700		558,369
Sankyo Co., Ltd.		11,600		463,896
Sega Sammy Holdings, Inc.		33,800		681,314
Sekisui Chemical Co., Ltd.		76,000		770,199
Sekisui House Ltd.		102,300		1,227,968
Sharp Corp. *(a)		269,785		676,288
Shimano, Inc.		14,200		1,419,456
Sony Corp.		189,900		3,333,806
Yamaha Corp.		28,500		381,862
				16,951,096
Consumer Services 0.1%
Benesse Holdings, Inc.		14,200		540,285
McDonald’s Holdings Co., Ltd. (a)		11,000		304,351
Oriental Land Co., Ltd.		9,300		1,393,264
				2,237,900
Diversified Financials 0.5%
Acom Co., Ltd. *(a)		88,800		302,645
AEON Financial Service Co., Ltd.		19,900		501,146
Credit Saison Co., Ltd.		27,800		592,230
Daiwa Securities Group, Inc.		297,000		2,227,036
Japan Exchange Group, Inc.		45,300		896,301
Mitsubishi UFJ Lease & Finance Co., Ltd.		97,400		480,555
Nomura Holdings, Inc.		661,300		3,829,502
ORIX Corp.		237,000		3,434,092
SBI Holdings, Inc.		38,090		435,595
				12,699,102
Energy 0.2%
Idemitsu Kosan Co., Ltd.		15,200		336,126
Inpex Corp.		155,800		2,272,094
Japan Petroleum Exploration Co.		8,600		320,143
JX Holdings, Inc.		401,000		2,083,515
Showa Shell Sekiyu K.K.		33,500		339,838
TonenGeneral Sekiyu K.K.		49,000		462,846
				5,814,562
Food & Staples Retailing 0.3%
Aeon Co., Ltd.		113,400		1,309,727
FamilyMart Co., Ltd.		11,200		465,082
Lawson, Inc.		11,300		784,801
Seven & i Holdings Co., Ltd.		137,203		5,413,516
				7,973,126
Food, Beverage & Tobacco 0.7%
Ajinomoto Co., Inc.		108,000		1,589,526
Asahi Group Holdings Ltd.		69,100		1,909,425
Calbee, Inc.		12,000		294,286
Coca-Cola West Co., Ltd.		13,303		231,527
Japan Tobacco, Inc.		201,400		6,619,725
Kikkoman Corp.		30,000		609,548
Kirin Holdings Co., Ltd.		159,000		2,202,153
MEIJI Holdings Co., Ltd.		11,300		693,445
Nippon Meat Packers, Inc.		33,000		571,935
Nisshin Seifun Group, Inc.		36,800		428,153
Nissin Foods Holdings Co., Ltd.		11,900		569,614
Suntory Beverage & Food Ltd.		24,500		855,597
Toyo Suisan Kaisha Ltd.		16,000		512,500
Yakult Honsha Co., Ltd.		16,800		908,041
Yamazaki Baking Co., Ltd.		26,000		317,676
				18,313,151

68 See financial notes

 Schwab International Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Health Care Equipment & Services 0.2%
Alfresa Holdings Corp.		8,200		510,506
M3, Inc.		27,200		373,145
Medipal Holdings Corp.		26,100		367,108
Miraca Holdings, Inc.		9,400		407,465
Olympus Corp. *		45,000		1,374,502
Suzuken Co., Ltd.		14,500		522,654
Sysmex Corp.		27,700		878,143
Terumo Corp.		57,700		1,145,092
				5,578,615
Household & Personal Products 0.2%
Kao Corp.		94,719		3,565,923
Shiseido Co., Ltd.		65,000		1,161,283
Unicharm Corp.		20,700		1,122,520
				5,849,726
Insurance 0.5%
MS&AD Insurance Group Holdings		92,162		2,067,391
NKSJ Holdings, Inc.		62,900		1,569,282
Sony Financial Holdings, Inc.		33,000		529,159
T&D Holdings, Inc.		109,400		1,305,830
The Dai-ichi Life Insurance Co., Ltd.		156,800		2,172,738
Tokio Marine Holdings, Inc.		126,099		3,715,623
				11,360,023
Materials 1.1%
Air Water, Inc.		26,000		364,815
Asahi Kasei Corp.		235,000		1,597,717
Daicel Corp.		51,000		427,114
Daido Steel Co., Ltd.		59,000		288,473
Hitachi Chemical Co., Ltd.		22,600		332,483
Hitachi Metals Ltd.		37,000		502,433
JFE Holdings, Inc.		87,700		1,620,806
JSR Corp.		31,300		512,908
Kaneka Corp.		58,000		340,188
Kansai Paint Co., Ltd.		40,000		559,234
Kobe Steel Ltd.		529,000		694,397
Kuraray Co., Ltd.		66,700		749,959
Maruichi Steel Tube Ltd.		8,800		223,223
Mitsubishi Chemical Holdings Corp.		233,500		934,473
Mitsubishi Gas Chemical Co., Inc.		64,000		369,503
Mitsubishi Materials Corp.		193,000		559,803
Mitsui Chemicals, Inc.		141,000		343,585
Nippon Paint Co., Ltd.		29,000		448,669
Nippon Steel & Sumitomo Metal Corp.		1,372,410		3,600,706
Nitto Denko Corp.		30,600		1,324,860
Oji Holdings Corp.		141,000		592,410
Shin-Etsu Chemical Co., Ltd.		75,960		4,455,971
Showa Denko K.K.		250,000		333,114
Sumitomo Chemical Co., Ltd.		257,000		964,172
Sumitomo Metal Mining Co., Ltd.		92,000		1,389,615
Taiheiyo Cement Corp.		204,000		715,609
Taiyo Nippon Sanso Corp.		36,000		286,948
Teijin Ltd.		161,000		395,746
Toray Industries, Inc.		269,000		1,755,701
Toyo Seikan Group Holdings Ltd.		33,400		496,721
Ube Industries Ltd.		183,000		310,042
Yamato Kogyo Co., Ltd.		7,700		222,054
				27,713,452
Media 0.1%
Dentsu, Inc.		39,200		1,607,697
Hakuhodo DY Holdings, Inc.		40,300		312,613
Toho Co., Ltd.		20,000		385,045
				2,305,355
Pharmaceuticals, Biotechnology & Life Sciences 0.9%
Astellas Pharma, Inc.		391,850		4,368,925
Chugai Pharmaceutical Co., Ltd.		40,500		1,022,174
Daiichi Sankyo Co., Ltd.		123,000		2,063,239
Dainippon Sumitomo Pharma Co., Ltd.		28,500		432,227
Eisai Co., Ltd.		47,800		1,845,992
Hisamitsu Pharmaceutical Co., Inc.		10,700		447,817
Kyowa Hakko Kirin Co., Ltd.		37,000		421,346
Mitsubishi Tanabe Pharma Corp.		37,900		519,695
Ono Pharmaceutical Co., Ltd.		14,700		1,165,911
Otsuka Holdings Co., Ltd.		68,300		1,967,571
Santen Pharmaceutical Co., Ltd.		12,800		570,492
Shionogi & Co., Ltd.		55,800		978,085
Taisho Pharmaceutical Holdings Co., Ltd.		6,500		479,099
Takeda Pharmaceutical Co., Ltd.		144,200		6,486,134
Tsumura & Co.		10,100		240,067
				23,008,774
Real Estate 0.9%
Aeon Mall Co., Ltd.		20,200		481,605
Daito Trust Construction Co., Ltd.		13,500		1,373,771
Daiwa House Industry Co., Ltd.		104,000		1,757,154
Hulic Co., Ltd.		45,700		551,216
Japan Prime Realty Investment Corp.		149		524,324
Japan Real Estate Investment Corp.		217		1,150,433
Japan Retail Fund Investment Corp.		422		848,773
Mitsubishi Estate Co., Ltd.		227,502		5,162,110
Mitsui Fudosan Co., Ltd.		151,777		4,492,861
Nippon Building Fund, Inc.		264		1,463,738
Nippon Prologis REIT, Inc.		268		567,564
Nomura Real Estate Holdings, Inc.		20,200		377,422
NTT Urban Development Corp.		22,700		199,657
Sumitomo Realty & Development Co., Ltd.		66,000		2,560,758
Tokyo Tatemono Co., Ltd.		70,000		558,236
Tokyu Fudosan Holdings Corp.		91,200		663,020
United Urban Investment Corp.		476		718,401
				23,451,043

See financial notes 69

 Schwab International Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Retailing 0.4%
ABC-Mart, Inc.		5,980		268,540
Don Quijote Holdings Co., Ltd.		10,400		548,517
Fast Retailing Co., Ltd.		9,400		2,920,948
Isetan Mitsukoshi Holdings Ltd.		61,800		769,043
J. Front Retailing Co., Ltd.		83,000		527,593
Marui Group Co., Ltd.		39,900		354,417
Nitori Holdings Co., Ltd.		12,700		582,532
Rakuten, Inc.		131,220		1,702,660
Sanrio Co., Ltd. (a)		10,800		342,401
Shimamura Co., Ltd.		4,200		391,265
Takashimaya Co., Ltd.		46,000		435,813
USS Co., Ltd.		36,500		532,029
Yamada Denki Co., Ltd.		174,000		642,838
				10,018,596
Semiconductors & Semiconductor Equipment 0.1%
Advantest Corp.		23,900		263,467
Rohm Co., Ltd.		18,900		903,833
Sumco Corp.		27,600		211,816
Tokyo Electron Ltd.		31,400		1,785,901
				3,165,017
Software & Services 0.4%
Dena Co., Ltd.		18,200		307,591
Fujitsu Ltd.		333,000		1,958,116
Gree, Inc. (a)		24,703		241,565
GungHo Online Entertainment, Inc. (a)		59,100		336,192
Itochu Techno-Solutions Corp.		8,506		355,458
Kakaku.com, Inc.		24,600		350,959
Konami Corp.		19,400		442,407
Nexon Co., Ltd.		28,900		225,092
Nintendo Co., Ltd.		19,439		2,040,325
Nomura Research Institute Ltd.		20,300		588,645
NTT Data Corp.		23,100		892,481
Oracle Corp., Japan		6,600		304,165
Otsuka Corp.		2,700		319,625
Trend Micro, Inc.		20,500		663,114
Yahoo Japan Corp.		255,000		1,113,963
				10,139,698
Technology Hardware & Equipment 1.5%
Brother Industries Ltd.		40,400		565,094
Canon, Inc.		207,395		6,498,712
Citizen Holdings Co., Ltd.		49,100		360,586
FUJIFILM Holdings Corp.		83,011		2,144,347
Hamamatsu Photonics K.K.		13,500		608,281
Hirose Electric Co., Ltd.		5,200		734,000
Hitachi High-Technologies Corp.		10,900		249,349
Hitachi Ltd.		884,079		6,302,544
Hoya Corp.		81,407		2,407,801
Ibiden Co., Ltd.		22,300		402,518
Keyence Corp.		8,400		3,240,397
Konica Minolta, Inc.		83,000		773,404
Kyocera Corp.		60,400		2,840,605
Murata Manufacturing Co., Ltd.		36,974		3,082,295
NEC Corp.		458,000		1,288,352
Nippon Electric Glass Co., Ltd.		65,000		317,975
Omron Corp.		36,800		1,303,249
Ricoh Co., Ltd.		118,000		1,359,722
Seiko Epson Corp.		22,900		624,941
Shimadzu Corp.		42,000		358,785
TDK Corp.		23,500		1,002,075
Yaskawa Electric Corp.		37,000		417,199
Yokogawa Electric Corp.		36,600		500,386
				37,382,617
Telecommunication Services 1.1%
KDDI Corp.		98,800		5,269,167
Nippon Telegraph & Telephone Corp.		68,478		3,800,033
NTT DOCOMO, Inc.		278,200		4,437,441
SoftBank Corp.		174,900		13,026,201
				26,532,842
Transportation 0.9%
ANA Holdings, Inc. (a)		193,000		421,464
Central Japan Railway Co.		27,400		3,365,426
East Japan Railway Co.		60,760		4,433,369
Hankyu Hanshin Holdings, Inc.		207,000		1,134,479
Japan Airlines Co., Ltd.		10,800		559,110
Kamigumi Co., Ltd.		40,000		381,292
Keikyu Corp.		78,000		647,441
Keio Corp.		97,000		686,527
Keisei Electric Railway Co., Ltd.		47,000		409,042
Kintetsu Corp.		341,000		1,198,366
Mitsubishi Logistics Corp.		25,000		358,674
Mitsui O.S.K. Lines Ltd.		192,000		640,525
Nippon Express Co., Ltd.		137,000		647,642
Nippon Yusen K.K.		279,000		756,236
Odakyu Electric Railway Co., Ltd.		108,000		948,162
Tobu Railway Co., Ltd.		176,000		860,813
Tokyu Corp.		196,000		1,234,453
West Japan Railway Co.		31,000		1,257,140
Yamato Holdings Co., Ltd.		70,100		1,442,530
				21,382,691
Utilities 0.4%
Chubu Electric Power Co., Inc. *		113,300		1,290,552
Electric Power Development Co., Ltd.		22,200		588,704
Hokkaido Electric Power Co., Inc. *		32,100		196,371
Hokuriku Electric Power Co.		29,200		362,629
Kyushu Electric Power Co., Inc. *		77,200		778,915
Osaka Gas Co., Ltd.		323,000		1,217,485
Shikoku Electric Power Co., Inc. *		33,700		394,460
The Chugoku Electric Power Co., Inc.		49,500		648,594
The Kansai Electric Power Co., Inc. *		121,300		1,017,118
Toho Gas Co., Ltd.		71,000		348,365
Tohoku Electric Power Co., Inc.		78,700		748,970
Tokyo Electric Power Co., Inc. *		253,490		958,762
Tokyo Gas Co., Ltd.		437,201		2,290,675
				10,841,600
				462,427,556

70 See financial notes

 Schwab International Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Netherlands 2.6%
Capital Goods 0.3%
Koninklijke Boskalis Westminster N.V.		15,021		851,340
Koninklijke Philips N.V.		171,229		5,481,580
OCI *		16,510		706,051
				7,038,971
Commercial & Professional Supplies 0.1%
Randstad Holding N.V.		21,628		1,263,933
Diversified Financials 0.4%
ING Groep N.V. CVA *		699,136		9,994,047
Energy 0.1%
Fugro N.V. CVA		13,619		902,458
Koninklijke Vopak N.V.		13,531		674,670
				1,577,128
Food & Staples Retailing 0.1%
Koninklijke Ahold N.V.		169,694		3,280,506
Food, Beverage & Tobacco 0.7%
Heineken Holding N.V.		17,645		1,127,721
Heineken N.V.		42,637		2,961,457
Unilever N.V. CVA		296,626		12,719,650
				16,808,828
Insurance 0.1%
Aegon N.V.		331,943		3,042,726
Delta Lloyd N.V.		33,185		873,361
				3,916,087
Materials 0.2%
Akzo Nobel N.V.		43,667		3,365,069
Koninklijke DSM N.V.		28,471		2,044,439
				5,409,508
Media 0.2%
Reed Elsevier N.V.		123,918		2,529,271
Wolters Kluwer N.V.		56,151		1,565,260
				4,094,531
Real Estate 0.0%
Corio N.V.		13,143		615,851
Semiconductors & Semiconductor Equipment 0.2%
ASML Holding N.V.		65,090		5,312,263
Software & Services 0.1%
Gemalto N.V.		14,299		1,598,707
Telecommunication Services 0.1%
Koninklijke (Royal) KPN N.V. *		571,283		2,029,692
Ziggo N.V.		27,244		1,183,012
				3,212,704
Transportation 0.0%
TNT Express N.V.		76,923		693,195
				64,816,259
New Zealand 0.1%
Health Care Equipment & Services 0.0%
Ryman Healthcare Ltd.		62,228		464,852
Materials 0.1%
Fletcher Building Ltd.		122,603		1,042,534
Telecommunication Services 0.0%
Telecom Corp. of New Zealand Ltd.		356,009		850,491
Transportation 0.0%
Auckland International Airport Ltd.		163,022		558,337
Utilities 0.0%
Contact Energy Ltd.		75,447		370,592
				3,286,806
Norway 0.8%
Banks 0.1%
DNB A.S.A.		179,466		3,181,128
Energy 0.4%
Aker Solutions A.S.A.		31,911		511,294
Seadrill Ltd.		68,660		2,402,462
Statoil A.S.A. (a)		203,216		6,195,120
Subsea 7 S.A.		48,790		976,984
				10,085,860
Food, Beverage & Tobacco 0.1%
Orkla A.S.A.		138,506		1,145,526
Insurance 0.0%
Gjensidige Forsikring A.S.A. (a)		35,100		647,168
Materials 0.1%
Norsk Hydro A.S.A.		243,121		1,303,905
Yara International A.S.A.		31,361		1,482,479
				2,786,384
Telecommunication Services 0.1%
Telenor A.S.A.		123,490		2,901,645
				20,747,711
Portugal 0.2%
Banks 0.0%
Banco Espirito Santo, S.A. - Reg’d *		311,555		552,242
Energy 0.1%
Galp Energia, SGPS, S.A.		65,228		1,130,533
Food & Staples Retailing 0.0%
Jeronimo Martins, SGPS, S.A.		49,264		861,596
Telecommunication Services 0.0%
Portugal Telecom, SGPS, S.A. - Reg’d (a)		109,146		453,466
Utilities 0.1%
EDP - Energias de Portugal S.A.		353,045		1,714,972
				4,712,809
Singapore 1.4%
Banks 0.5%
DBS Group Holdings Ltd.		312,246		4,230,047
Oversea-Chinese Banking Corp., Ltd.		469,552		3,621,269
United Overseas Bank Ltd.		235,233		4,094,259
				11,945,575

See financial notes 71

 Schwab International Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Capital Goods 0.2%
Keppel Corp., Ltd.		263,800		2,219,621
Noble Group Ltd.		740,000		761,963
Sembcorp Industries Ltd.		173,000		742,713
Sembcorp Marine Ltd.		152,000		494,338
Singapore Technologies Engineering Ltd.		278,000		849,109
Yangzijiang Shipbuilding Holdings Ltd.		319,000		280,547
				5,348,291
Consumer Services 0.0%
Genting Singapore plc		1,053,000		1,115,763
Diversified Financials 0.0%
Singapore Exchange Ltd.		163,000		901,434
Food & Staples Retailing 0.0%
Olam International Ltd. (a)		268,000		478,224
Food, Beverage & Tobacco 0.1%
Golden Agri-Resources Ltd.		1,217,000		593,695
Wilmar International Ltd.		348,000		945,799
				1,539,494
Media 0.0%
Singapore Press Holdings Ltd. (a)		302,000		1,009,882
Real Estate 0.3%
Ascendas REIT		383,000		701,029
CapitaCommercial Trust		359,000		459,429
CapitaLand Ltd.		481,000		1,231,011
CapitaMall Trust		391,000		623,269
CapitaMalls Asia Ltd.		261,000		459,902
City Developments Ltd.		74,000		641,137
Global Logistic Properties Ltd.		542,000		1,235,266
Keppel Land Ltd.		102,000		282,177
UOL Group Ltd.		95,000		487,753
				6,120,973
Retailing 0.0%
Jardine Cycle & Carriage Ltd.		22,000		824,910
Telecommunication Services 0.2%
Singapore Telecommunications Ltd.		1,432,237		4,387,108
StarHub Ltd.		141,000		467,736
				4,854,844
Transportation 0.1%
ComfortDelGro Corp., Ltd.		344,000		583,362
Hutchison Port Holdings Trust, Class U		901,000		613,182
Singapore Airlines Ltd.		98,000		812,462
				2,009,006
				36,148,396
Spain 3.5%
Banks 1.7%
Banco Bilbao Vizcaya Argentaria S.A.		1,074,233		13,232,117
Banco de Sabadell S.A.		610,222		2,076,147
Banco Popular Espanol S.A.		290,698		2,142,131
Banco Santander S.A.		2,156,646		21,449,283
Bankia S.A. *		697,188		1,424,090
CaixaBank S.A.		318,622		1,941,914
				42,265,682
Capital Goods 0.1%
ACS, Actividades de Construccion y Servicios S.A.		31,029		1,331,900
Ferrovial S.A.		69,156		1,537,222
Zardoya Otis S.A.		27,869		488,906
				3,358,028
Energy 0.2%
Repsol S.A.		158,426		4,265,533
Food & Staples Retailing 0.0%
Distribuidora Internacional de Alimentacion S.A.		106,667		954,187
Insurance 0.0%
Mapfre S.A.		202,213		852,834
Pharmaceuticals, Biotechnology & Life Sciences 0.1%
Grifols S.A.		26,346		1,408,390
Retailing 0.3%
Inditex S.A.		39,726		5,968,710
Software & Services 0.1%
Amadeus IT Holding S.A., A Shares		67,746		2,817,590
Telecommunication Services 0.5%
Telefonica S.A.		745,834		12,516,669
Transportation 0.1%
Abertis Infraestructuras S.A.		67,905		1,528,512
International Consolidated Airlines Group S.A. *		175,975		1,204,202
				2,732,714
Utilities 0.4%
Enagas S.A.		33,328		1,026,794
Gas Natural SDG S.A.		60,724		1,741,262
Iberdrola S.A.		868,680		6,068,194
Red Electrica Corp. S.A.		19,645		1,617,100
				10,453,350
				87,593,687
Sweden 3.2%
Banks 0.9%
Nordea Bank AB		556,276		8,060,771
Skandinaviska Enskilda Banken AB, A Shares		278,103		3,841,414
Svenska Handelsbanken AB, A Shares		90,885		4,571,510
Swedbank AB, A Shares		164,118		4,392,112
				20,865,807
Capital Goods 0.9%
Alfa Laval AB (a)		58,742		1,565,085
Assa Abloy AB, B Shares		61,342		3,255,700
Atlas Copco AB, A Shares		122,277		3,556,159
Atlas Copco AB, B Shares		71,715		1,956,047
Sandvik AB		191,343		2,719,352
Scania AB, B Shares		59,551		1,814,301
Skanska AB, B Shares		70,514		1,618,951
SKF AB, B Shares		71,618		1,859,783

72 See financial notes

 Schwab International Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Volvo AB, B Shares		276,989		4,385,882
				22,731,260
Commercial & Professional Supplies 0.0%
Securitas AB, B Shares		54,176		654,914
Consumer Durables & Apparel 0.1%
Electrolux AB, B Shares		46,562		1,294,226
Husqvarna AB, B Shares		66,683		556,776
				1,851,002
Diversified Financials 0.2%
Industrivarden AB, C Shares		25,073		526,828
Investment AB Kinnevik, B Shares		41,907		1,478,783
Investor AB, B Shares		81,460		3,155,419
				5,161,030
Energy 0.0%
Lundin Petroleum AB *		39,631		850,728
Food, Beverage & Tobacco 0.1%
Swedish Match AB		36,845		1,264,035
Health Care Equipment & Services 0.1%
Elekta AB, B Shares		62,504		872,286
Getinge AB, B Shares		34,780		1,019,358
				1,891,644
Household & Personal Products 0.1%
Svenska Cellulosa AB, S.C.A., B Shares		107,313		3,016,893
Materials 0.0%
Boliden AB		47,175		720,470
Retailing 0.3%
Hennes & Mauritz AB, B Shares		173,319		7,094,450
Technology Hardware & Equipment 0.3%
Hexagon AB, B Shares		43,336		1,387,429
Telefonaktiebolaget LM Ericsson, B Shares		554,159		6,682,303
				8,069,732
Telecommunication Services 0.2%
Millicom International Cellular S.A. SDR		11,852		1,174,709
Tele2 AB, B Shares		53,012		677,446
TeliaSonera AB		435,207		3,167,896
				5,020,051
				79,192,016
Switzerland 9.0%
Capital Goods 0.6%
ABB Ltd. - Reg’d *		400,421		9,640,569
Geberit AG - Reg’d		6,957		2,323,569
Schindler Holding AG		8,056		1,248,116
Schindler Holding AG - Reg’d		3,737		570,416
Sulzer AG - Reg’d		4,467		689,269
				14,471,939
Commercial & Professional Supplies 0.2%
Adecco S.A. - Reg’d *		24,149		2,027,358
SGS S.A. - Reg’d		994		2,483,109
				4,510,467
Consumer Durables & Apparel 0.5%
Cie Financiere Richemont S.A.		95,052		9,670,591
The Swatch Group AG - Bearer Shares		5,616		3,611,312
The Swatch Group AG - Reg’d		8,016		967,209
				14,249,112
Diversified Financials 1.0%
Credit Suisse Group AG - Reg’d *		275,990		8,749,610
Julius Baer Group Ltd. *		41,230		1,931,230
Pargesa Holding S.A.		4,900		444,760
Partners Group Holding AG		3,301		903,871
UBS AG - Reg’d *		664,575		13,898,831
				25,928,302
Energy 0.1%
Transocean Ltd.		64,015		2,734,649
Food, Beverage & Tobacco 2.0%
Aryzta AG *		15,818		1,462,144
Barry Callebaut AG - Reg’d *		419		569,441
Coca-Cola HBC AG ADR		28,832		726,278
Lindt & Spruengli AG		146		710,010
Lindt & Spruengli AG - Reg’d		19		1,108,136
Nestle S.A. - Reg’d		587,209		45,382,016
				49,958,025
Health Care Equipment & Services 0.1%
Sonova Holding AG - Reg’d *		9,131		1,319,107
Insurance 0.6%
Baloise Holding AG - Reg’d		8,221		1,001,101
Swiss Life Holding AG - Reg’d *		5,791		1,426,761
Swiss Re AG *		64,374		5,628,932
Zurich Insurance Group AG *		27,112		7,774,601
				15,831,395
Materials 0.6%
EMS-Chemie Holding AG - Reg’d		1,449		565,396
Givaudan S.A. - Reg’d *		1,697		2,678,162
Holcim Ltd. - Reg’d *		41,692		3,823,840
Sika AG		380		1,537,555
Syngenta AG - Reg’d		17,025		6,741,756
				15,346,709
Pharmaceuticals, Biotechnology & Life Sciences 3.1%
Actelion Ltd. - Reg’d *		18,954		1,866,090
Lonza Group AG - Reg’d *		10,065		1,053,408
Novartis AG - Reg’d		418,859		36,412,459
Roche Holding AG		127,931		37,528,058
				76,860,015
Real Estate 0.0%
Swiss Prime Site AG - Reg’d *		10,375		872,136
Telecommunication Services 0.1%
Swisscom AG - Reg’d		4,178		2,541,808
Transportation 0.1%
Kuehne & Nagel International AG - Reg’d		9,754		1,333,770
				225,957,434

See financial notes 73

 Schwab International Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
United Kingdom 21.1%
Automobiles & Components 0.1%
GKN plc		294,455		1,914,251
Banks 2.8%
Barclays plc		2,785,700		11,895,058
HSBC Holdings plc		3,413,951		34,882,423
Lloyds Banking Group plc *		9,096,859		11,600,428
Royal Bank of Scotland Group plc *		389,581		1,973,791
Standard Chartered plc		441,862		9,569,511
				69,921,211
Capital Goods 0.9%
Wolseley plc		47,520		2,753,515
BAE Systems plc		588,056		3,978,475
Bunzl plc		62,819		1,789,823
Cobham plc		186,038		970,534
IMI plc		52,003		1,318,929
Meggitt plc		150,186		1,211,417
Melrose Industries plc		185,522		895,899
Rolls-Royce Holdings plc *		343,380		6,099,279
Smiths Group plc		70,698		1,595,915
The Weir Group plc		38,375		1,745,566
Travis Perkins plc		46,219		1,334,358
				23,693,710
Commercial & Professional Supplies 0.5%
Aggreko plc		51,326		1,369,856
Babcock International Group plc		65,181		1,315,611
Capita plc		118,741		2,177,405
Experian plc		183,456		3,527,304
G4S plc		267,361		1,067,431
Intertek Group plc		30,549		1,504,815
Serco Group plc		86,020		493,948
				11,456,370
Consumer Durables & Apparel 0.1%
Burberry Group plc		81,675		2,051,206
Persimmon plc *		57,253		1,270,557
				3,321,763
Consumer Services 0.5%
Carnival plc		32,775		1,310,305
Compass Group plc		327,267		5,213,017
InterContinental Hotels Group plc		47,228		1,614,088
TUI Travel plc		79,902		577,951
Whitbread plc		33,683		2,323,317
William Hill plc		151,700		908,992
				11,947,670
Diversified Financials 0.3%
3i Group plc		167,421		1,075,419
Aberdeen Asset Management plc		167,236		1,236,950
Hargreaves Lansdown plc		42,297		837,298
ICAP plc		99,435		696,530
Investec plc		101,621		896,680
London Stock Exchange Group plc		33,988		1,041,611
Schroders plc		17,787		769,216
				6,553,704
Energy 3.7%
AMEC plc		57,377		1,198,329
BG Group plc		620,762		12,557,585
BP plc		3,395,901		28,671,972
Petrofac Ltd.		49,680		1,218,772
Royal Dutch Shell plc, A Shares		702,997		27,792,423
Royal Dutch Shell plc, B Shares		451,454		19,169,183
Tullow Oil plc		165,688		2,464,658
				93,072,922
Food & Staples Retailing 0.4%
J. Sainsbury plc		214,494		1,216,782
Tesco plc		1,472,100		7,292,674
WM Morrison Supermarkets plc		410,451		1,393,344
				9,902,800
Food, Beverage & Tobacco 2.6%
Associated British Foods plc		65,720		3,299,830
British American Tobacco plc		343,981		19,863,158
Coca-Cola HBC AG CDI *		7,420		188,041
Diageo plc		457,073		14,004,623
Imperial Tobacco Group plc		176,007		7,606,032
SABMiller plc		175,294		9,544,928
Tate & Lyle plc		88,993		1,054,979
Unilever plc		233,707		10,454,428
				66,016,019
Health Care Equipment & Services 0.1%
Smith & Nephew plc		162,741		2,537,643
Household & Personal Products 0.4%
Reckitt Benckiser Group plc		117,959		9,522,352
Insurance 1.2%
Admiral Group plc		35,329		834,313
Aviva plc		529,657		4,720,192
Direct Line Insurance Group plc		209,135		884,761
Legal & General Group plc		1,066,958		3,819,433
Old Mutual plc		873,969		2,954,089
Prudential plc		466,031		10,713,636
Resolution Ltd.		244,640		1,234,171
RSA Insurance Group plc		866,325		1,435,642
Standard Life plc		423,687		2,739,133
				29,335,370
Materials 2.0%
Anglo American plc		253,863		6,786,544
Antofagasta plc		75,900		1,011,535
BHP Billiton plc		384,591		12,485,505
Croda International plc		25,002		1,088,949
Fresnillo plc		34,820		502,103
Glencore Xstrata plc		1,932,125		10,425,291
Johnson Matthey plc		36,948		2,043,961
Randgold Resources Ltd.		15,897		1,277,850
Rexam plc		143,971		1,207,042
Rio Tinto plc		231,511		12,586,716
				49,415,496

74 See financial notes

 Schwab International Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Media 0.6%
British Sky Broadcasting Group plc		188,892		2,806,541
ITV plc		698,980		2,150,132
Pearson plc		150,931		2,830,253
Reed Elsevier plc		212,756		3,137,644
WPP plc		244,923		5,280,930
				16,205,500
Pharmaceuticals, Biotechnology & Life Sciences 1.9%
AstraZeneca plc		228,601		18,044,527
GlaxoSmithKline plc		885,286		24,460,922
Shire plc		108,129		6,184,107
				48,689,556
Real Estate 0.3%
British Land Co., plc		171,413		2,002,607
Hammerson plc		126,093		1,216,935
Intu Properties plc		159,596		788,436
Land Securities Group plc		146,224		2,626,792
Segro plc		131,113		775,994
				7,410,764
Retailing 0.4%
ASOS plc *		9,568		693,366
Kingfisher plc		424,778		3,005,890
Marks & Spencer Group plc		288,154		2,154,329
Next plc		28,747		3,171,422
				9,025,007
Semiconductors & Semiconductor Equipment 0.1%
ARM Holdings plc		254,969		3,859,006
Software & Services 0.1%
The Sage Group plc		193,854		1,398,362
Telecommunication Services 1.1%
BT Group plc		1,439,930		8,988,969
Inmarsat plc		84,463		1,039,269
Vodafone Group plc		4,813,579		18,275,268
				28,303,506
Transportation 0.1%
easyJet plc		31,365		867,858
Royal Mail plc *		114,688		1,027,563
				1,895,421
Utilities 0.9%
Centrica plc		928,298		5,177,153
National Grid plc		679,252		9,654,376
Severn Trent plc		44,786		1,395,127
SSE plc		174,833		4,508,332
United Utilities Group plc		125,986		1,694,639
				22,429,627
				527,828,030
Total Common Stock
(Cost $1,795,245,659)				2,420,335,392
Preferred Stock 0.6% of net assets
Germany 0.6%
Automobiles & Components 0.5%
Bayerische Motoren Werke AG		10,237		1,009,113
Porsche Automobil Holding SE		27,421		3,032,625
Volkswagen AG		26,334		7,118,739
				11,160,477
Household & Personal Products 0.1%
Henkel AG & Co. KGaA		32,582		3,634,528
Materials 0.0%
Fuchs Petrolub SE		6,305		634,249
				15,429,254
United Kingdom 0.0%
Capital Goods 0.0%
Rolls-Royce Holdings plc *(b)(c)		46,012,920		77,688
Total Preferred Stock
(Cost $9,585,888)				15,506,942
Rights 0.0% of net assets
Australia 0.0%
Banks 0.0%
Bank of Queensland Ltd. *(b)(c)		6,153		8,631
Spain 0.0%
Banks 0.0%
Banco Santander S.A. *(a)(b)(c)		2,078,006		439,614
United Kingdom 0.0%
Commercial & Professional Supplies 0.0%
Babcock International Group plc *		25,069		169,306
Total Rights
(Cost $429,850)				617,551
Warrants 0.0% of net assets
Hong Kong 0.0%
Real Estate 0.0%
Sun Hung Kai Properties Ltd. *(c)		23,717		15,968
Total Warrants
(Cost $—)				15,968
Other Investment Company 0.4% of net assets
United States 0.4%
iShares MSCI EAFE ETF		140,000		9,564,800
Total Other Investment Company
(Cost $8,089,400)				9,564,800

See financial notes 75

 Schwab International Index Fund

Portfolio Holdings (Unaudited) continued

Security	Face Amount		Value
Rate, Maturity Date	Local Currency		($)
Short-Term Investments 1.8% of net assets
Time Deposits 1.6%
Bank of Tokyo Mitsubishi
Japanese Yen
0.01%, 05/01/14		2,487,646		24,333
Brown Brothers Harriman
Hong Kong Dollar
0.01%, 05/01/14		1,349,530		174,067
Singapore Dollar
0.01%, 05/01/14		7,050		5,623
Swiss Franc
0.01%, 05/01/14		80,149		91,068
DNB
US Dollar
0.03%, 05/01/14		37,460,427		37,460,427
Wells Fargo
Australian Dollar
1.50%, 05/01/14		414,223		384,813
Euro Currency
0.05%, 05/01/14		402,141		557,909
Pound Sterling
0.07%, 05/01/14		330,761		558,456
				39,256,696
U.S. Treasury Obligations 0.2%
U.S. Treasury Bill
0.05%, 06/19/14 (d)(e)		4,000,000		3,999,728
U.S. Treasury Bills
0.02%, 06/19/14 (d)(e)		100,000		99,998
				4,099,726
Total Short-Term Investments
(Cost $43,356,422)				43,356,422
End of Investments.
	Number		Value
Security	of Shares		($)
Collateral Invested for Securities on Loan 1.6% of net assets
Wells Fargo Advantage Government Money Market Fund, Institutional Class 0.01% (f)		39,582,384		39,582,384
Total Collateral Invested for Securities on Loan
(Cost $39,582,384)				39,582,384
End of collateral invested for securities on loan.

At 04/30/14, the tax basis cost of the fund’s investments was $1,865,329,188 and the unrealized appreciation and depreciation were $724,768,165 and ($100,700,278), respectively, with a net unrealized appreciation of $624,067,887.

At 04/30/14, the values of certain foreign securities held by the fund aggregating $2,410,064,032 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(a) for additional information).

*	Non-income producing security.
(a)	All or a portion of this security is on loan. Securities on loan were valued at $37,263,952.
(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 $541,901 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.
(f)	The rate shown is the 7-day yield.

ADR —	American Depositary Receipt
CDI —	CHESS Depositary Interest
CVA —	Dutch Certificate
ETF —	Exchange traded fund
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 04/30/14:

			Contract		Unrealized
	Number of		Value		Appreciation
	Contracts		($)		($)
Futures Contracts
MSCI EAFE, e-mini, Long, expires 06/20/14		410		39,448,150		1,294,344

76 See financial notes

 Schwab Fundamental US Large Company Index Fund

Portfolio Holdings as of April 30, 2014 (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	.8%	Common Stock		2,448,657,217		3,425,643,615
	0	.7%	Other Investment Company		25,474,573		25,474,573
	0	.1%	Short-Term Investments		1,504,963		1,504,963
	99	.6%	Total Investments		2,475,636,753		3,452,623,151
	0	.3%	Collateral Invested for Securities on Loan		11,391,401		11,391,401
	0	.1%	Other Assets and Liabilities, Net				3,924,123
	100	.0%	Net Assets				3,467,938,675

	Number		Value
Security	of Shares		($)
Common Stock 98.8% of net assets
Automobiles & Components 1.0%
BorgWarner, Inc.		28,400		1,764,776
Delphi Automotive plc		40,500		2,707,020
Ford Motor Co.		539,174		8,707,660
General Motors Co.		187,200		6,454,656
Harley-Davidson, Inc.		35,760		2,644,094
Johnson Controls, Inc.		142,710		6,441,929
Lear Corp.		23,100		1,918,686
The Goodyear Tire & Rubber Co.		61,590		1,552,068
TRW Automotive Holdings Corp. *		24,650		1,980,628
Visteon Corp. *		13,700		1,189,297
				35,360,814
Banks 5.5%
Bank of America Corp.		2,835,960		42,936,434
BB&T Corp.		130,175		4,859,433
CIT Group, Inc.		22,000		947,100
Citigroup, Inc.		530,533		25,417,836
Comerica, Inc.		29,900		1,442,376
Fifth Third Bancorp		150,690		3,105,721
Hudson City Bancorp, Inc.		163,190		1,625,372
Huntington Bancshares, Inc.		145,427		1,332,111
JPMorgan Chase & Co.		742,342		41,556,305
KeyCorp		168,990		2,305,024
M&T Bank Corp.		17,486		2,133,467
New York Community Bancorp, Inc.		91,530		1,410,477
Popular, Inc. *		34,268		1,058,881
Regions Financial Corp.		299,825		3,040,226
SunTrust Banks, Inc.		105,560		4,038,726
The PNC Financial Services Group, Inc.		79,445		6,676,558
U.S. Bancorp		265,500		10,827,090
Wells Fargo & Co.		678,625		33,686,945
Zions Bancorp		39,835		1,152,028
				189,552,110
Capital Goods 7.9%
3M Co.		107,975		15,018,243
AECOM Technology Corp. *		30,600		992,052
AGCO Corp.		24,840		1,383,588
Alliant Techsystems, Inc.		7,920		1,142,222
AMETEK, Inc.		17,800		938,416
Caterpillar, Inc.		113,945		12,009,803
Cummins, Inc.		28,884		4,357,151
Danaher Corp.		49,400		3,624,972
Deere & Co.		75,286		7,027,195
Dover Corp.		33,675		2,909,520
Eaton Corp. plc		53,099		3,857,111
EMCOR Group, Inc.		23,840		1,096,402
Emerson Electric Co.		151,450		10,325,861
Exelis, Inc.		86,455		1,602,876
Fastenal Co.		25,940		1,299,075
Flowserve Corp.		20,375		1,488,394
Fluor Corp.		55,640		4,211,948
General Cable Corp.		27,900		714,798
General Dynamics Corp.		88,825		9,721,896
General Electric Co.		1,850,325		49,755,239
Harsco Corp.		43,035		1,029,828
Honeywell International, Inc.		101,540		9,433,066
Hubbell, Inc., Class B		9,130		1,074,784
Illinois Tool Works, Inc.		66,870		5,699,330
Ingersoll-Rand plc		68,442		4,092,832
ITT Corp.		50,527		2,179,735
Jacobs Engineering Group, Inc. *		34,940		2,016,038
Joy Global, Inc.		24,500		1,479,310
KBR, Inc.		66,600		1,689,642
L-3 Communications Holdings, Inc.		49,335		5,691,779
Lennox International, Inc.		11,435		958,596
Lockheed Martin Corp.		69,035		11,331,405
Masco Corp.		78,950		1,586,106
Northrop Grumman Corp.		100,795		12,247,600
Oshkosh Corp.		26,920		1,494,329
Owens Corning		34,950		1,427,708
PACCAR, Inc.		59,642		3,815,895
Pall Corp.		12,440		1,046,826
Parker Hannifin Corp.		33,717		4,278,013
Pentair Ltd.		13,637		1,013,093
Precision Castparts Corp.		11,716		2,965,202
Quanta Services, Inc. *		36,900		1,301,832
Raytheon Co.		103,910		9,921,327
Rockwell Automation, Inc.		14,250		1,698,315
Rockwell Collins, Inc.		24,730		1,920,285
Roper Industries, Inc.		7,400		1,028,230
Snap-on, Inc.		7,700		893,200
SPX Corp.		15,335		1,561,716
Stanley Black & Decker, Inc.		22,203		1,907,016
Terex Corp.		28,725		1,243,505

See financial notes 1

 Schwab Fundamental US Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Textron, Inc.		64,120		2,622,508
The Boeing Co.		77,140		9,952,603
The Timken Co.		20,065		1,265,700
United Rentals, Inc. *		14,900		1,398,067
United Technologies Corp.		178,115		21,076,348
URS Corp.		39,893		1,879,758
W.W. Grainger, Inc.		9,235		2,349,384
WESCO International, Inc. *		14,600		1,281,588
Xylem, Inc.		31,855		1,197,429
				274,526,690
Commercial & Professional Supplies 0.7%
Cintas Corp.		25,550		1,505,661
Equifax, Inc.		15,530		1,099,679
Iron Mountain, Inc.		43,280		1,230,883
Manpowergroup, Inc.		40,190		3,269,055
Pitney Bowes, Inc.		96,705		2,591,694
R.R. Donnelley & Sons Co.		157,940		2,779,744
Republic Services, Inc.		54,624		1,916,756
Robert Half International, Inc.		39,110		1,752,128
The ADT Corp. (b)		42,200		1,276,128
The Dun & Bradstreet Corp.		9,400		1,041,144
United Stationers, Inc.		20,950		786,254
Waste Management, Inc.		137,555		6,114,320
				25,363,446
Consumer Durables & Apparel 0.9%
Coach, Inc.		55,975		2,499,284
D.R. Horton, Inc.		49,890		1,111,549
Garmin Ltd.		28,670		1,637,057
Harman International Industries, Inc.		11,820		1,295,590
Hasbro, Inc.		34,665		1,915,588
Jarden Corp. *		18,615		1,063,847
Leggett & Platt, Inc.		45,020		1,479,357
Mattel, Inc.		61,835		2,424,860
Mohawk Industries, Inc. *		10,135		1,341,975
Newell Rubbermaid, Inc.		50,850		1,531,094
NIKE, Inc., Class B		100,556		7,335,560
NVR, Inc. *		1,403		1,511,031
Ralph Lauren Corp.		10,420		1,577,276
VF Corp.		42,580		2,601,212
Whirlpool Corp.		21,155		3,244,754
				32,570,034
Consumer Services 1.5%
Apollo Education Group, Inc. *		77,650		2,240,979
Brinker International, Inc.		26,755		1,314,741
Carnival Corp.		67,545		2,655,194
Darden Restaurants, Inc.		39,645		1,970,753
Graham Holdings Co., Class B		1,580		1,060,543
H&R Block, Inc.		42,865		1,218,223
International Game Technology		66,155		830,245
Marriott International, Inc., Class A		36,689		2,125,394
McDonald’s Corp.		201,780		20,456,456
MGM Resorts International *		51,715		1,304,769
Royal Caribbean Cruises Ltd.		33,805		1,796,060
Service Corp. International		50,800		953,516
Starbucks Corp.		51,380		3,628,456
Starwood Hotels & Resorts Worldwide, Inc.		29,370		2,251,210
Wyndham Worldwide Corp.		27,340		1,950,436
Wynn Resorts Ltd.		9,800		1,998,122
Yum! Brands, Inc.		63,130		4,860,379
				52,615,476
Diversified Financials 2.9%
American Express Co.		123,725		10,817,277
Ameriprise Financial, Inc.		24,000		2,679,120
Berkshire Hathaway, Inc., Class B *		187,411		24,147,907
BlackRock, Inc.		8,400		2,528,400
Capital One Financial Corp.		98,320		7,265,848
CME Group, Inc.		28,300		1,992,037
Discover Financial Services		56,922		3,181,940
Eaton Vance Corp.		21,400		771,898
Franklin Resources, Inc.		67,920		3,555,612
Invesco Ltd.		51,900		1,827,399
Legg Mason, Inc.		38,620		1,810,892
McGraw Hill Financial, Inc.		60,580		4,478,680
Moody’s Corp.		22,870		1,795,295
Morgan Stanley		163,235		5,048,859
Northern Trust Corp.		29,160		1,756,890
PHH Corp. *		44,290		1,052,773
SLM Corp.		56,635		1,458,351
State Street Corp.		47,836		3,088,292
T. Rowe Price Group, Inc.		32,145		2,640,069
The Bank of New York Mellon Corp.		139,052		4,709,691
The Charles Schwab Corp. (a)		118,815		3,154,538
The Goldman Sachs Group, Inc.		77,111		12,323,880
				102,085,648
Energy 16.1%
Alpha Natural Resources, Inc. *(b)		154,800		665,640
Anadarko Petroleum Corp.		69,215		6,853,669
Apache Corp.		80,820		7,015,176
Arch Coal, Inc. (b)		209,400		959,052
Baker Hughes, Inc.		99,349		6,944,495
Cameron International Corp. *		29,980		1,947,501
Chesapeake Energy Corp.		175,120		5,034,700
Chevron Corp.		680,805		85,454,644
Cimarex Energy Co.		10,845		1,291,856
ConocoPhillips		930,410		69,138,767
CONSOL Energy, Inc.		39,235		1,746,350
Devon Energy Corp.		110,240		7,716,800
Diamond Offshore Drilling, Inc. (b)		28,420		1,552,016
Energen Corp.		11,310		881,162
EOG Resources, Inc.		43,300		4,243,400
EQT Corp.		10,000		1,089,900
Exxon Mobil Corp.		1,679,384		171,985,715
FMC Technologies, Inc. *		24,280		1,376,676
Halliburton Co.		143,165		9,029,417
Helmerich & Payne, Inc.		12,295		1,335,852
Hess Corp.		109,550		9,767,478
HollyFrontier Corp.		34,402		1,809,201

2 See financial notes

 Schwab Fundamental US Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Kinder Morgan, Inc.		65,200		2,129,432
Marathon Oil Corp.		372,890		13,479,974
Marathon Petroleum Corp.		102,295		9,508,320
McDermott International, Inc. *		127,010		918,282
Murphy Oil Corp.		101,475		6,436,559
Nabors Industries Ltd.		109,500		2,794,440
National Oilwell Varco, Inc.		67,723		5,318,287
Newfield Exploration Co. *		45,100		1,526,635
Noble Energy, Inc.		29,070		2,086,645
Occidental Petroleum Corp.		158,070		15,135,203
ONEOK, Inc.		36,320		2,296,150
Patterson-UTI Energy, Inc.		40,000		1,301,200
Peabody Energy Corp.		109,845		2,088,154
Phillips 66		379,955		31,619,855
Pioneer Natural Resources Co.		6,300		1,217,601
QEP Resources, Inc.		43,950		1,348,826
Rowan Cos. plc, Class A *		26,300		813,196
Schlumberger Ltd.		170,100		17,273,655
SEACOR Holdings, Inc. *		12,000		1,000,680
Seadrill Ltd.		54,100		1,905,402
Southwestern Energy Co. *		30,940		1,481,407
Spectra Energy Corp.		100,360		3,985,296
Tesoro Corp.		62,260		3,504,615
The Williams Cos., Inc.		108,475		4,574,391
Valero Energy Corp.		398,625		22,789,391
World Fuel Services Corp.		58,300		2,654,982
WPX Energy, Inc. *		89,858		1,912,178
				558,940,223
Food & Staples Retailing 4.2%
Casey’s General Stores, Inc.		13,312		914,002
Costco Wholesale Corp.		119,915		13,871,767
CVS Caremark Corp.		417,835		30,384,961
Safeway, Inc.		235,440		8,019,086
SUPERVALU, Inc. *		312,020		2,181,020
Sysco Corp.		215,640		7,855,765
The Kroger Co.		237,620		10,940,025
Wal-Mart Stores, Inc.		608,125		48,473,644
Walgreen Co.		287,170		19,498,843
Whole Foods Market, Inc.		38,300		1,903,510
				144,042,623
Food, Beverage & Tobacco 5.2%
Altria Group, Inc.		410,580		16,468,364
Archer-Daniels-Midland Co.		308,005		13,469,059
Brown-Forman Corp., Class B		18,050		1,619,446
Bunge Ltd.		100,775		8,026,729
Campbell Soup Co.		44,430		2,021,121
Coca-Cola Enterprises, Inc.		74,395		3,380,509
ConAgra Foods, Inc.		127,905		3,902,381
Constellation Brands, Inc., Class A *		16,205		1,293,807
Dean Foods Co.		94,395		1,495,217
Dr Pepper Snapple Group, Inc.		46,100		2,554,862
General Mills, Inc.		103,410		5,482,798
Hormel Foods Corp.		25,420		1,212,280
Ingredion, Inc.		14,200		1,000,390
Kellogg Co.		51,180		3,420,359
Kraft Foods Group, Inc.		114,300		6,499,098
Lorillard, Inc.		75,754		4,501,303
McCormick & Co., Inc. - Non Voting Shares		15,940		1,134,928
Mead Johnson Nutrition Co.		10,000		882,600
Molson Coors Brewing Co., Class B		24,980		1,498,051
Mondelez International, Inc., Class A		455,392		16,234,725
PepsiCo, Inc.		267,708		22,993,440
Philip Morris International, Inc.		288,420		24,639,720
Reynolds American, Inc.		61,050		3,445,051
The Coca-Cola Co.		480,830		19,613,056
The Hershey Co.		13,150		1,265,556
The Hillshire Brands Co.		99,300		3,540,045
The JM Smucker Co.		20,725		2,003,693
Tyson Foods, Inc., Class A		128,380		5,388,108
				178,986,696
Health Care Equipment & Services 5.6%
Abbott Laboratories		411,390		15,937,249
Aetna, Inc.		119,932		8,569,141
AmerisourceBergen Corp.		105,540		6,879,097
Baxter International, Inc.		105,160		7,654,596
Becton, Dickinson & Co.		43,055		4,866,507
Boston Scientific Corp. *		237,865		2,999,478
C.R. Bard, Inc.		15,300		2,101,149
Cardinal Health, Inc.		157,620		10,956,166
CareFusion Corp. *		29,810		1,164,379
Cigna Corp.		32,109		2,570,004
Community Health Systems, Inc. *		41,462		1,570,995
Covidien plc		67,070		4,778,737
DaVita HealthCare Partners, Inc. *		23,120		1,602,216
DENTSPLY International, Inc.		20,135		898,625
Express Scripts Holding Co. *		74,640		4,969,531
HCA Holdings, Inc. *		118,500		6,162,000
Health Net, Inc. *		75,870		2,604,617
Henry Schein, Inc. *		15,030		1,716,877
Humana, Inc.		58,740		6,446,715
Laboratory Corp. of America Holdings *		14,030		1,384,761
LifePoint Hospitals, Inc. *		17,730		991,462
Magellan Health Services, Inc. *		16,600		958,152
McKesson Corp.		79,000		13,366,010
Medtronic, Inc.		183,065		10,767,883
Omnicare, Inc.		29,110		1,725,350
Owens & Minor, Inc.		36,902		1,237,693
Patterson Cos., Inc.		28,175		1,146,723
Quest Diagnostics, Inc.		50,655		2,833,134
St. Jude Medical, Inc.		53,660		3,405,800
Stryker Corp.		48,045		3,735,499
Tenet Healthcare Corp. *		26,393		1,189,796
UnitedHealth Group, Inc.		325,575		24,431,148
Universal Health Services, Inc., Class B		15,450		1,263,656
Varian Medical Systems, Inc. *		16,820		1,338,031
WellCare Health Plans, Inc. *		13,200		890,604
WellPoint, Inc.		234,770		23,636,644
Zimmer Holdings, Inc.		39,940		3,866,192
				192,616,617

See financial notes 3

 Schwab Fundamental US Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Household & Personal Products 2.1%
Avon Products, Inc.		137,525		2,101,382
Church & Dwight Co., Inc.		14,600		1,007,546
Colgate-Palmolive Co.		124,060		8,349,238
Energizer Holdings, Inc.		9,220		1,029,782
Herbalife Ltd. (b)		17,400		1,043,652
Kimberly-Clark Corp.		65,720		7,377,070
The Clorox Co.		15,420		1,398,594
The Estee Lauder Cos., Inc., Class A		19,820		1,438,337
The Procter & Gamble Co.		597,595		49,331,467
				73,077,068
Insurance 3.4%
ACE Ltd.		44,500		4,553,240
Aflac, Inc.		75,240		4,719,053
Allied World Assurance Co. Holdings AG		8,400		904,596
American Financial Group, Inc.		21,440		1,252,739
American International Group, Inc.		189,980		10,093,637
Aon plc		33,636		2,855,024
Arch Capital Group Ltd. *		31,975		1,832,807
Assurant, Inc.		33,055		2,228,238
Axis Capital Holdings Ltd.		34,250		1,566,938
Cincinnati Financial Corp.		33,580		1,636,689
Endurance Specialty Holdings Ltd.		18,830		956,941
Everest Re Group Ltd.		10,525		1,663,266
Fidelity National Financial, Inc., Class A		54,125		1,741,742
Genworth Financial, Inc., Class A *		112,400		2,006,340
Hartford Financial Services Group, Inc.		138,410		4,964,767
HCC Insurance Holdings, Inc.		21,800		1,001,492
Lincoln National Corp.		40,780		1,978,238
Loews Corp.		69,482		3,055,124
Marsh & McLennan Cos., Inc.		73,750		3,636,612
MetLife, Inc.		113,305		5,931,517
PartnerRe Ltd.		16,930		1,784,422
Platinum Underwriters Holdings Ltd.		13,000		815,230
Principal Financial Group, Inc.		40,085		1,877,581
Prudential Financial, Inc.		76,740		6,191,383
Reinsurance Group of America, Inc.		14,000		1,073,940
RenaissanceRe Holdings Ltd.		15,325		1,551,043
The Allstate Corp.		123,355		7,025,067
The Chubb Corp.		86,775		7,990,242
The Progressive Corp.		184,045		4,463,091
The Travelers Cos., Inc.		192,695		17,454,313
Torchmark Corp.		18,310		1,459,307
Unum Group		63,925		2,123,588
W. R. Berkley Corp.		36,360		1,608,566
White Mountains Insurance Group Ltd.		1,429		852,056
XL Group plc		49,685		1,557,625
				116,406,454
Materials 3.9%
Air Products & Chemicals, Inc.		37,675		4,427,566
Airgas, Inc.		11,600		1,232,616
Albemarle Corp.		14,400		965,376
Alcoa, Inc.		607,305		8,180,398
Allegheny Technologies, Inc.		41,511		1,710,253
AptarGroup, Inc.		13,100		883,202
Ashland, Inc.		14,135		1,365,441
Avery Dennison Corp.		30,250		1,471,965
Ball Corp.		38,080		2,139,715
Bemis Co., Inc.		31,755		1,277,821
Celanese Corp., Series A		25,200		1,548,036
CF Industries Holdings, Inc.		8,571		2,101,352
Cliffs Natural Resources, Inc. (b)		80,700		1,430,004
Commercial Metals Co.		71,845		1,379,424
Cytec Industries, Inc.		8,700		829,284
Domtar Corp.		21,591		2,015,736
E.I. du Pont de Nemours & Co.		130,545		8,788,290
Eastman Chemical Co.		27,020		2,355,333
Ecolab, Inc.		16,091		1,683,762
FMC Corp.		14,680		1,130,360
Freeport-McMoRan Copper & Gold, Inc.		310,170		10,660,543
Huntsman Corp.		50,115		1,255,381
International Flavors & Fragrances, Inc.		12,035		1,185,688
International Paper Co.		108,895		5,079,952
LyondellBasell Industries N.V., Class A		80,700		7,464,750
Martin Marietta Materials, Inc.		8,210		1,020,749
MeadWestvaco Corp.		46,740		1,826,132
Monsanto Co.		52,395		5,800,127
Newmont Mining Corp.		157,110		3,901,041
Nucor Corp.		107,180		5,546,565
Owens-Illinois, Inc. *		45,645		1,450,598
Packaging Corp. of America		12,845		855,862
PPG Industries, Inc.		20,300		3,930,486
Praxair, Inc.		43,670		5,701,119
Reliance Steel & Aluminum Co.		26,520		1,878,146
RPM International, Inc.		25,265		1,077,805
Sealed Air Corp.		38,175		1,309,784
Sigma-Aldrich Corp.		15,030		1,446,036
Sonoco Products Co.		28,955		1,218,426
Southern Copper Corp.		39,422		1,188,179
Steel Dynamics, Inc.		86,050		1,572,134
The Dow Chemical Co.		256,400		12,794,360
The Mosaic Co.		72,210		3,613,389
The Sherwin-Williams Co.		7,645		1,527,777
The Valspar Corp.		13,650		996,996
United States Steel Corp.		96,095		2,500,392
Vulcan Materials Co.		19,823		1,279,178
				134,997,529
Media 3.7%
Cablevision Systems Corp., Class A		95,865		1,600,946
CBS Corp., Class B - Non Voting Shares		104,290		6,023,790
Charter Communications, Inc., Class A *		12,000		1,626,360

4 See financial notes

 Schwab Fundamental US Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Comcast Corp., Class A		352,140		18,226,767
DIRECTV *		158,740		12,318,224
Discovery Communications, Inc., Class A *		24,167		1,834,275
DISH Network Corp., Class A *		27,970		1,590,374
Gannett Co., Inc.		79,630		2,163,547
Liberty Global plc, Class A *		90,148		3,589,693
Liberty Global plc, Series C *		91,148		3,502,818
Omnicom Group, Inc.		55,704		3,770,047
Starz, Class A *		42,200		1,361,794
The Interpublic Group of Cos., Inc.		66,005		1,149,807
The Walt Disney Co.		281,350		22,322,309
Thomson Reuters Corp. (b)		81,500		2,948,670
Time Warner Cable, Inc.		64,009		9,054,713
Time Warner, Inc.		287,988		19,139,683
Twenty-First Century Fox, Inc., Class A		264,520		8,469,930
Viacom, Inc., Class B		95,500		8,115,590
				128,809,337
Pharmaceuticals, Biotechnology & Life Sciences 5.6%
AbbVie, Inc.		155,200		8,082,816
Actavis plc *		11,773		2,405,577
Agilent Technologies, Inc.		47,005		2,540,150
Allergan, Inc.		19,030		3,155,935
Amgen, Inc.		141,655		15,829,946
Biogen Idec, Inc. *		8,250		2,368,740
Bristol-Myers Squibb Co.		241,650		12,104,248
Celgene Corp. *		13,700		2,014,037
Eli Lilly & Co.		201,555		11,911,900
Forest Laboratories, Inc. *		50,055		4,600,555
Gilead Sciences, Inc. *		101,420		7,960,456
Hospira, Inc. *		28,050		1,284,690
Johnson & Johnson		441,395		44,708,900
Merck & Co., Inc.		422,557		24,744,938
Mettler-Toledo International, Inc. *		3,600		839,232
Mylan, Inc. *		31,175		1,583,067
Pfizer, Inc.		1,349,299		42,206,073
Thermo Fisher Scientific, Inc.		37,845		4,314,330
Waters Corp. *		9,100		896,714
				193,552,304
Real Estate 1.0%
American Tower Corp.		12,365		1,032,725
Annaly Capital Management, Inc.		275,885		3,186,472
Apartment Investment & Management Co., Class A		36,054		1,111,545
AvalonBay Communities, Inc.		7,599		1,037,643
Boston Properties, Inc.		14,690		1,720,787
Crown Castle International Corp.		15,980		1,162,225
Equity Residential		33,745		2,005,803
HCP, Inc.		33,465		1,400,845
Health Care REIT, Inc.		14,200		895,878
Hospitality Properties Trust		36,455		1,095,473
Host Hotels & Resorts, Inc.		84,878		1,820,633
Kimco Realty Corp.		41,860		959,431
Plum Creek Timber Co., Inc.		30,095		1,312,142
Prologis, Inc.		23,900		971,057
Public Storage		9,930		1,742,814
Rayonier, Inc.		17,902		807,380
Simon Property Group, Inc.		18,576		3,217,363
Ventas, Inc.		20,078		1,326,754
Vornado Realty Trust REIT		21,328		2,188,253
Weyerhaeuser Co.		220,357		6,577,657
				35,572,880
Retailing 4.2%
Aaron’s, Inc.		33,400		984,298
Abercrombie & Fitch Co., Class A		36,510		1,342,108
Advance Auto Parts, Inc.		15,045		1,824,808
Amazon.com, Inc. *		9,250		2,813,203
American Eagle Outfitters, Inc.		103,935		1,201,489
AutoNation, Inc. *		16,900		895,531
AutoZone, Inc. *		2,823		1,507,172
Bed Bath & Beyond, Inc. *		48,965		3,042,195
Best Buy Co., Inc.		234,500		6,080,585
Big Lots, Inc. *		44,765		1,768,218
CarMax, Inc. *		25,280		1,106,758
Core-Mark Holding Co., Inc.		15,300		1,232,262
Dick’s Sporting Goods, Inc.		15,900		837,294
Dillard’s, Inc., Class A		11,975		1,172,712
Dollar General Corp. *		47,900		2,703,476
Dollar Tree, Inc. *		38,134		1,985,637
Expedia, Inc.		24,765		1,758,067
Family Dollar Stores, Inc.		24,775		1,455,531
Foot Locker, Inc.		41,395		1,926,109
GameStop Corp., Class A		55,390		2,197,875
Genuine Parts Co.		37,300		3,249,576
J.C. Penney Co., Inc. *(b)		286,400		2,440,128
Kohl’s Corp.		116,895		6,404,677
L Brands, Inc.		39,620		2,147,404
Liberty Interactive Corp., Class A *		115,220		3,348,293
Lowe’s Cos., Inc.		337,055		15,474,195
Macy’s, Inc.		91,320		5,244,508
Nordstrom, Inc.		39,755		2,436,186
O’Reilly Automotive, Inc. *		11,830		1,760,186
PetSmart, Inc.		22,740		1,539,043
RadioShack Corp. *(b)		275,780		394,365
Rent-A-Center, Inc.		36,670		1,071,131
Ross Stores, Inc.		25,590		1,742,167
Sears Holdings Corp. *(b)		53,721		2,353,517
Signet Jewelers Ltd.		14,000		1,418,480
Staples, Inc.		429,750		5,371,875
Target Corp.		266,995		16,486,941
The Gap, Inc.		100,775		3,960,458
The Home Depot, Inc.		235,796		18,748,140
The Priceline Group, Inc. *		1,084		1,255,001
The TJX Cos., Inc.		110,760		6,444,017
Tiffany & Co.		15,835		1,385,404
Tractor Supply Co.		16,400		1,102,736
Williams-Sonoma, Inc.		19,745		1,240,381
				144,854,137
Semiconductors & Semiconductor Equipment 2.4%
Altera Corp.		39,850		1,295,922
Analog Devices, Inc.		49,565		2,542,189
Applied Materials, Inc.		270,625		5,158,113

See financial notes 5

 Schwab Fundamental US Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Broadcom Corp., Class A		85,145		2,623,317
Intel Corp.		1,501,810		40,083,309
KLA-Tencor Corp.		31,780		2,033,602
Lam Research Corp. *		25,700		1,480,577
Linear Technology Corp.		30,355		1,350,798
LSI Corp.		150,640		1,678,130
Marvell Technology Group Ltd.		100,230		1,589,648
Maxim Integrated Products, Inc.		51,400		1,667,416
Microchip Technology, Inc.		30,180		1,434,757
Micron Technology, Inc. *		149,775		3,912,123
NVIDIA Corp.		75,437		1,393,321
Texas Instruments, Inc.		256,670		11,665,651
Xilinx, Inc.		34,720		1,638,437
				81,547,310
Software & Services 6.3%
Accenture plc, Class A		75,495		6,056,209
Adobe Systems, Inc. *		52,940		3,265,868
Alliance Data Systems Corp. *		5,880		1,422,372
Amdocs Ltd.		36,300		1,689,039
AOL, Inc. *		43,480		1,861,379
Autodesk, Inc. *		21,900		1,051,638
Automatic Data Processing, Inc.		64,580		5,034,657
Broadridge Financial Solutions, Inc.		24,000		920,160
CA, Inc.		57,305		1,727,173
Citrix Systems, Inc. *		14,200		842,202
Cognizant Technology Solutions Corp., Class A *		34,800		1,667,094
Computer Sciences Corp.		66,545		3,938,133
CoreLogic, Inc. *		69,000		1,934,070
DST Systems, Inc.		11,400		1,050,966
eBay, Inc. *		102,475		5,311,279
Fidelity National Information Services, Inc.		51,423		2,747,531
Fiserv, Inc. *		39,700		2,412,966
Google, Inc., Class A *		10,957		5,860,680
Google, Inc., Class C *		10,872		5,725,847
IAC/InterActiveCorp		19,762		1,309,825
International Business Machines Corp.		243,495		47,839,463
Intuit, Inc.		32,855		2,488,766
Leidos Holdings, Inc.		45,600		1,698,144
MasterCard, Inc., Class A		52,562		3,865,935
Microsoft Corp.		1,696,315		68,531,126
Oracle Corp.		412,460		16,861,365
Paychex, Inc.		48,560		2,030,294
Symantec Corp.		156,345		3,170,677
Teradata Corp. *		17,800		809,188
The Western Union Co.		147,910		2,347,332
Total System Services, Inc.		37,270		1,184,068
Visa, Inc., Class A		15,600		3,160,716
Xerox Corp.		417,126		5,043,053
Yahoo! Inc. *		69,005		2,480,730
				217,339,945
Technology Hardware & Equipment 4.5%
Amphenol Corp., Class A		17,500		1,668,625
Anixter International, Inc.		10,520		1,030,750
Apple, Inc.		45,617		26,918,136
Arrow Electronics, Inc. *		52,295		2,967,741
Avnet, Inc.		70,380		3,035,489
Cisco Systems, Inc.		1,012,565		23,400,377
Corning, Inc.		245,260		5,128,387
EMC Corp.		228,910		5,905,878
Harris Corp.		31,825		2,339,774
Hewlett-Packard Co.		1,513,675		50,042,095
Ingram Micro, Inc., Class A *		170,555		4,598,163
Jabil Circuit, Inc.		76,395		1,318,578
Juniper Networks, Inc. *		106,370		2,626,275
Lexmark International, Inc., Class A		30,145		1,296,235
Motorola Solutions, Inc.		69,445		4,415,313
NetApp, Inc.		30,130		1,072,929
QUALCOMM, Inc.		111,885		8,806,468
SanDisk Corp.		21,765		1,849,372
Tech Data Corp. *		54,540		3,408,205
Vishay Intertechnology, Inc.		65,040		924,869
Western Digital Corp.		31,500		2,776,095
				155,529,754
Telecommunication Services 4.2%
AT&T, Inc.		2,048,385		73,127,344
CenturyLink, Inc.		138,655		4,840,446
Frontier Communications Corp. (b)		533,298		3,173,123
NII Holdings, Inc. *(b)		743,470		639,310
Sprint Corp. *		706,057		6,001,485
Telephone & Data Systems, Inc.		67,227		1,827,902
Verizon Communications, Inc.		1,175,230		54,918,498
Windstream Holdings, Inc. (b)		307,100		2,785,397
				147,313,505
Transportation 1.6%
Avis Budget Group, Inc. *		45,590		2,397,578
C.H. Robinson Worldwide, Inc.		46,680		2,749,452
CSX Corp.		263,110		7,424,964
Expeditors International of Washington, Inc.		42,425		1,749,607
FedEx Corp.		79,262		10,799,447
Hertz Global Holdings, Inc. *		83,600		2,380,092
J.B. Hunt Transport Services, Inc.		13,445		1,023,165
Norfolk Southern Corp.		55,650		5,260,594
Ryder System, Inc.		24,420		2,006,836
Union Pacific Corp.		58,656		11,169,862
United Parcel Service, Inc., Class B		96,260		9,481,610
				56,443,207
Utilities 4.4%
AES Corp.		243,140		3,513,373
AGL Resources, Inc.		20,514		1,107,756
Alliant Energy Corp.		26,175		1,530,714
Ameren Corp.		90,590		3,742,273
American Electric Power Co., Inc.		128,045		6,890,101
American Water Works Co., Inc.		27,600		1,256,628
Atmos Energy Corp.		27,760		1,416,870
Calpine Corp. *		79,250		1,817,203
CenterPoint Energy, Inc.		108,570		2,688,193

6 See financial notes

 Schwab Fundamental US Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
CMS Energy Corp.		63,410		1,921,957
Consolidated Edison, Inc.		82,525		4,788,926
Dominion Resources, Inc.		144,110		10,453,739
DTE Energy Co.		49,265		3,849,567
Duke Energy Corp.		109,948		8,190,027
Edison International		92,490		5,231,234
Entergy Corp.		91,417		6,627,732
Exelon Corp.		337,037		11,806,406
FirstEnergy Corp.		177,534		5,991,772
Great Plains Energy, Inc.		40,170		1,077,761
Integrys Energy Group, Inc.		30,635		1,877,313
MDU Resources Group, Inc.		48,080		1,702,994
National Fuel Gas Co.		12,745		938,542
NextEra Energy, Inc.		76,080		7,596,588
NiSource, Inc.		71,835		2,609,047
Northeast Utilities		38,315		1,810,767
NRG Energy, Inc.		104,226		3,410,275
OGE Energy Corp.		34,030		1,270,340
Pepco Holdings, Inc.		100,165		2,680,415
PG&E Corp.		127,315		5,803,018
Pinnacle West Capital Corp.		29,685		1,660,876
PPL Corp.		128,355		4,279,356
Public Service Enterprise Group, Inc.		161,780		6,628,127
Questar Corp.		41,650		1,011,262
SCANA Corp.		33,385		1,792,107
Sempra Energy		46,215		4,557,261
TECO Energy, Inc.		78,925		1,417,493
The Southern Co.		199,370		9,137,127
UGI Corp.		32,120		1,499,683
Vectren Corp.		23,100		937,167
Westar Energy, Inc.		30,870		1,107,616
Wisconsin Energy Corp.		37,640		1,824,787
Xcel Energy, Inc.		128,190		4,085,415
				153,539,808
Total Common Stock
(Cost $2,448,657,217)				3,425,643,615
Other Investment Company 0.7% of net assets
Money Market Fund 0.7%
State Street Institutional U.S. Government Money Market Fund, Institutional Class 0.00% (e)		25,474,573		25,474,573
Total Other Investment Company
(Cost $25,474,573)				25,474,573
Security	Face Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 0.1% of net assets
U.S. Treasury Obligations 0.1%
U.S. Treasury Bills
0.01%, 06/19/14 (c)(d)		455,000		454,994
0.02%, 06/19/14 (c)(d)		850,000		849,983
0.05%, 06/19/14 (c)(d)		200,000		199,986
Total Short-Term Investments
(Cost $1,504,963)				1,504,963
End of Investments.
	Number		Value
Security	of Shares		($)
Collateral Invested for Securities on Loan 0.3% of net assets
State Street Institutional U.S. Government Money Market Fund, Institutional Class 0.00% (e)		11,391,401		11,391,401
Total Collateral Invested for Securities on Loan
(Cost $11,391,401)				11,391,401
End of Collateral Invested for Securities on Loan.

At 04/30/14 tax basis cost of the fund’s investments was $2,491,750,930 and the unrealized appreciation and depreciation were $978,046,927 and ($17,174,706), respectively, with a net unrealized appreciation of $960,872,221.

*	Non-income producing security.
(a)	Issuer is affiliated with the fund’s adviser.
(b)	All or a portion of this security is on loan. Securities on loan were valued at $13,153,104.
(c)	All or a portion of this security is held as collateral for open futures contracts.
(d)	The rate shown is the purchase yield.
(e)	The rate shown is the 7-day yield.

REIT — Real Estate Investment Trust

In addition to the above, the fund held the following at 04/30/14:

			Contract		Unrealized
	Number of		Value		Appreciation
	Contracts		($)		($)
Futures Contracts
S&P 500 Index, e-mini, Long, expires 06/20/14		370		34,741,150		542,850

See financial notes 7

 Schwab Fundamental US Small Company Index Fund

Portfolio Holdings as of April 30, 2014 (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	.3%	Common Stock		849,941,868		1,115,345,025
	0	.0%	Rights		266,856		266,364
	1	.3%	Other Investment Company		14,922,078		14,922,078
	0	.3%	Short-Term Investment		3,049,793		3,049,793
	99	.9%	Total Investments		868,180,595		1,133,583,260
	2	.7%	Collateral Invested for Securities on Loan		30,398,073		30,398,073
	(2	.6%)	Other Assets and Liabilities, Net				(29,549,057	)
	100	.0%	Net Assets				1,134,432,276

	Number		Value
Security	of Shares		($)
Common Stock 98.3% of net assets
Automobiles & Components 0.9%
Cooper Tire & Rubber Co.		55,700		1,400,855
Dana Holding Corp.		116,100		2,457,837
Drew Industries, Inc.		11,995		603,588
Gentex Corp.		57,700		1,654,259
Superior Industries International, Inc.		34,060		720,029
Tenneco, Inc. *		20,700		1,239,309
Thor Industries, Inc.		40,800		2,483,496
				10,559,373
Banks 4.1%
Associated Banc-Corp.		105,700		1,855,035
Astoria Financial Corp.		79,000		1,047,540
BancorpSouth, Inc.		52,200		1,219,392
Bank of Hawaii Corp.		31,600		1,743,372
BankUnited, Inc.		21,000		692,790
BOK Financial Corp.		11,000		719,620
Capitol Federal Financial, Inc.		61,586		741,495
Cathay General Bancorp		28,400		670,240
City Holding Co.		12,090		519,749
City National Corp.		16,900		1,226,433
Commerce Bancshares, Inc.		35,904		1,561,106
Community Bank System, Inc.		13,600		505,784
Cullen/Frost Bankers, Inc.		20,700		1,581,687
CVB Financial Corp.		38,480		556,421
East West Bancorp, Inc.		36,400		1,256,164
F.N.B. Corp.		68,900		857,116
First Financial Bancorp		31,400		508,366
First Horizon National Corp.		147,400		1,693,626
First Midwest Bancorp, Inc.		34,895		571,231
First Niagara Financial Group, Inc.		153,900		1,372,788
First Republic Bank		21,100		1,071,036
FirstMerit Corp.		57,101		1,107,188
Fulton Financial Corp.		105,100		1,281,169
Glacier Bancorp, Inc.		24,980		640,987
Hancock Holding Co.		22,300		752,179
International Bancshares Corp.		33,600		771,456
MB Financial, Inc.		22,945		615,844
NBT Bancorp, Inc.		23,455		531,256
Northwest Bancshares, Inc.		55,792		741,476
Old National Bancorp		43,325		611,749
People’s United Financial, Inc.		168,600		2,407,608
Prosperity Bancshares, Inc.		12,800		755,200
Provident Financial Services, Inc.		35,190		611,602
Signature Bank *		5,100		605,982
Susquehanna Bancshares, Inc.		71,400		739,704
SVB Financial Group *		7,800		832,182
Synovus Financial Corp.		643,300		2,064,993
TCF Financial Corp.		120,400		1,890,280
Trustmark Corp.		39,000		891,930
UMB Financial Corp.		12,401		728,063
Umpqua Holdings Corp.		44,000		731,720
United Bankshares, Inc.		26,395		772,054
Valley National Bancorp		145,300		1,455,906
Washington Federal, Inc.		53,600		1,156,688
Webster Financial Corp.		37,500		1,130,250
Westamerica Bancorp		15,170		770,939
Wintrust Financial Corp.		12,340		553,079
				47,122,475
Capital Goods 11.1%
A.O. Smith Corp.		25,300		1,183,028
AAR Corp.		41,680		1,079,512
Actuant Corp., Class A		31,500		1,066,590
Acuity Brands, Inc.		18,200		2,267,174
Aegion Corp. *		26,315		670,769
Aircastle Ltd.		68,900		1,210,573
Albany International Corp., Class A		18,200		654,836
Apogee Enterprises, Inc.		23,395		743,259
Applied Industrial Technologies, Inc.		39,720		1,903,382
Armstrong World Industries, Inc. *		27,700		1,455,912
Astec Industries, Inc.		19,350		773,033
B/E Aerospace, Inc. *		23,100		2,027,487
Barnes Group, Inc.		34,365		1,323,740
Beacon Roofing Supply, Inc. *		27,280		970,622
Briggs & Stratton Corp.		67,600		1,444,612
Carlisle Cos., Inc.		33,600		2,763,600
Chart Industries, Inc. *		6,010		410,002
Chicago Bridge & Iron Co., N.V.		32,098		2,570,087
CIRCOR International, Inc.		9,490		770,683
CLARCOR, Inc.		24,825		1,433,892
Crane Co.		27,700		2,014,621
Cubic Corp.		12,690		601,887
Curtiss-Wright Corp.		33,800		2,161,172
DigitalGlobe, Inc. *		14,600		434,788
Donaldson Co., Inc.		59,500		2,504,355
Dycom Industries, Inc. *		34,270		1,076,078

8 See financial notes

 Schwab Fundamental US Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Encore Wire Corp.		23,040		1,122,739
EnerSys, Inc.		25,000		1,689,500
EnPro Industries, Inc. *		10,270		731,327
ESCO Technologies, Inc.		17,700		591,534
Esterline Technologies Corp. *		14,300		1,558,986
Fortune Brands Home & Security, Inc.		36,300		1,446,555
Franklin Electric Co., Inc.		17,860		690,646
GATX Corp.		47,800		3,137,114
Generac Holdings, Inc.		15,600		918,528
Gibraltar Industries, Inc. *		41,155		702,927
Graco, Inc.		22,040		1,597,900
GrafTech International Ltd. *		110,900		1,243,189
Granite Construction, Inc.		57,900		2,164,302
H&E Equipment Services, Inc. *		23,720		914,406
HEICO Corp.		12,612		697,696
Hexcel Corp. *		28,285		1,179,202
Huntington Ingalls Industries, Inc.		32,000		3,296,000
IDEX Corp.		28,900		2,155,073
Kaman Corp.		20,380		855,349
Kennametal, Inc.		50,900		2,378,557
Layne Christensen Co. *		43,000		749,060
Lincoln Electric Holdings, Inc.		37,300		2,492,013
MasTec, Inc. *		25,410		1,005,728
Meritor, Inc. *		76,200		904,494
Moog, Inc., Class A *		23,600		1,544,620
MRC Global, Inc. *		74,500		2,174,655
MSC Industrial Direct Co., Inc., Class A		23,000		2,094,380
Mueller Industries, Inc.		66,700		1,930,298
Mueller Water Products, Inc., Class A		108,600		990,432
National Presto Industries, Inc. (a)		7,745		559,654
Navistar International Corp. *		45,100		1,710,643
Nordson Corp.		19,450		1,446,108
Orbital Sciences Corp. *		43,055		1,265,817
Polypore International, Inc. *(a)		16,100		558,348
Quanex Building Products Corp.		44,150		831,786
Raven Industries, Inc.		15,330		473,697
Regal-Beloit Corp.		28,600		2,137,278
Rush Enterprises, Inc., Class A *		27,960		897,516
Simpson Manufacturing Co., Inc.		25,685		842,211
Spirit AeroSystems Holdings, Inc., Class A *		85,900		2,579,577
TAL International Group, Inc. *		17,990		758,818
Teledyne Technologies, Inc. *		16,500		1,532,190
Tennant Co.		10,780		687,656
The Babcock & Wilcox Co.		49,800		1,732,542
The Greenbrier Cos., Inc. *		16,920		887,285
The Manitowoc Co., Inc.		71,700		2,278,626
The Middleby Corp. *		3,208		809,956
The Toro Co.		35,920		2,282,357
Titan International, Inc.		30,675		537,119
TransDigm Group, Inc.		13,800		2,454,606
TriMas Corp. *		13,600		487,696
Trinity Industries, Inc.		49,100		3,685,446
Triumph Group, Inc.		21,500		1,393,415
Tutor Perini Corp. *		84,900		2,513,040
Universal Forest Products, Inc.		36,770		1,856,517
Valmont Industries, Inc.		11,050		1,645,455
WABCO Holdings, Inc. *		21,400		2,290,014
Wabtec Corp.		22,520		1,678,866
Watsco, Inc.		16,845		1,733,519
Watts Water Technologies, Inc., Class A		19,555		1,040,326
Woodward, Inc.		33,700		1,510,771
				125,571,759
Commercial & Professional Supplies 4.3%
ABM Industries, Inc.		78,300		2,121,147
Brady Corp., Class A		47,900		1,235,341
Clean Harbors, Inc. *		20,230		1,213,800
Copart, Inc. *		68,200		2,473,614
Covanta Holding Corp.		79,200		1,461,240
Deluxe Corp.		34,100		1,873,795
FTI Consulting, Inc. *		38,200		1,310,260
G&K Services, Inc., Class A		17,990		952,391
Healthcare Services Group, Inc.		32,455		944,440
Herman Miller, Inc.		46,110		1,421,571
HNI Corp.		49,000		1,726,270
Huron Consulting Group, Inc. *		9,300		662,160
ICF International, Inc. *		18,100		705,357
IHS, Inc., Class A *		9,610		1,159,254
Insperity, Inc.		26,060		835,484
Interface, Inc.		31,785		571,812
KAR Auction Services, Inc.		26,800		798,104
Kelly Services, Inc., Class A		85,100		1,792,206
Kforce, Inc.		37,400		864,688
Knoll, Inc.		41,300		751,247
Korn/Ferry International *		31,030		901,422
McGrath RentCorp		17,025		537,650
MSA Safety, Inc.		14,625		771,469
Navigant Consulting, Inc. *		55,325		929,460
Nielsen Holdings N.V.		63,600		2,986,020
Quad Graphics, Inc.		51,500		1,114,975
Resources Connection, Inc.		66,460		904,521
Rollins, Inc.		20,022		602,262
Steelcase, Inc., Class A		120,800		1,990,784
Stericycle, Inc. *		16,300		1,897,972
Tetra Tech, Inc. *		38,495		1,103,652
The Brink’s Co.		56,400		1,434,816
The Corporate Executive Board Co.		16,570		1,143,661
Towers Watson & Co., Class A		17,015		1,909,423
TrueBlue, Inc. *		46,030		1,231,302
UniFirst Corp.		7,905		760,777
Verisk Analytics, Inc., Class A *		26,900		1,616,421
Viad Corp.		28,865		665,338
Waste Connections, Inc.		34,300		1,531,838
				48,907,944
Consumer Durables & Apparel 3.5%
Arctic Cat, Inc.		10,800		441,612
Blyth, Inc. (a)		47,844		448,298
Brunswick Corp.		17,700		711,363
Callaway Golf Co.		102,255		890,641
Carter’s, Inc.		21,500		1,583,690
Columbia Sportswear Co.		10,980		944,060
Crocs, Inc. *		51,960		786,155
Deckers Outdoor Corp. *		17,650		1,393,467
Ethan Allen Interiors, Inc.		23,765		577,014
Fossil Group, Inc. *		20,600		2,196,990

See financial notes 9

 Schwab Fundamental US Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
G-III Apparel Group Ltd. *		10,600		760,762
Hanesbrands, Inc.		31,600		2,594,044
Helen of Troy Ltd. *		14,630		917,301
JAKKS Pacific, Inc. (a)		92,825		813,147
KB Home		45,400		749,554
La-Z-Boy, Inc.		37,320		904,264
Lennar Corp., Class A		43,000		1,659,370
M.D.C. Holdings, Inc. (a)		25,200		695,520
Meritage Homes Corp. *		13,000		501,540
Michael Kors Holdings Ltd. *		8,200		747,840
NACCO Industries, Inc., Class A		14,840		795,276
Polaris Industries, Inc.		15,900		2,135,847
PulteGroup, Inc.		89,500		1,645,905
PVH Corp.		18,889		2,371,892
Quiksilver, Inc. *		120,500		773,610
Skechers U.S.A., Inc., Class A *		32,245		1,321,723
Steven Madden Ltd. *		19,722		702,300
Tempur Sealy International, Inc. *		40,915		2,053,115
The Ryland Group, Inc.		14,900		572,011
Toll Brothers, Inc. *		48,100		1,646,944
Tupperware Brands Corp.		29,900		2,538,809
Under Armour, Inc., Class A *		19,460		951,399
Wolverine World Wide, Inc. (a)		60,880		1,710,728
				39,536,191
Consumer Services 4.8%
Bally Technologies, Inc. *		22,475		1,463,347
Bob Evans Farms, Inc.		38,755		1,816,447
Boyd Gaming Corp. *		75,400		891,228
Buffalo Wild Wings, Inc. *		4,400		642,928
Burger King Worldwide, Inc.		36,300		948,519
Caesars Entertainment Corp. *(a)		94,100		1,738,027
Capella Education Co.		10,400		606,944
Career Education Corp. *		380,900		2,750,098
Chipotle Mexican Grill, Inc. *		4,576		2,281,136
Choice Hotels International, Inc.		12,240		540,763
Cracker Barrel Old Country Store, Inc.		14,320		1,356,677
DeVry Education Group, Inc.		64,700		2,913,441
DineEquity, Inc.		9,130		692,145
Domino’s Pizza, Inc.		29,700		2,209,086
Dunkin’ Brands Group, Inc.		14,200		646,242
Hillenbrand, Inc.		32,100		975,840
Hyatt Hotels Corp., Class A *		21,100		1,187,508
International Speedway Corp., Class A		24,350		765,564
ITT Educational Services, Inc. *(a)		67,635		1,826,145
Jack in the Box, Inc. *		43,700		2,339,698
Las Vegas Sands Corp.		36,500		2,888,245
Life Time Fitness, Inc. *		19,885		954,480
Marriott Vacations Worldwide Corp. *		18,300		996,984
Matthews International Corp., Class A		23,915		964,970
Panera Bread Co., Class A *		8,375		1,281,124
Papa John’s International, Inc.		20,620		904,393
Penn National Gaming, Inc. *		101,500		1,132,740
Pinnacle Entertainment, Inc. *		28,275		657,959
Red Robin Gourmet Burgers, Inc. *		11,080		753,218
Regis Corp.		105,500		1,386,270
Ruby Tuesday, Inc. *		134,850		1,039,694
SeaWorld Entertainment, Inc.		16,200		486,972
Six Flags Entertainment Corp.		20,600		826,884
Sonic Corp. *		68,480		1,303,859
Sotheby’s		21,220		892,513
Steiner Leisure Ltd. *		12,360		533,581
Strayer Education, Inc. *		36,600		1,560,258
Texas Roadhouse, Inc.		35,810		885,940
The Cheesecake Factory, Inc.		47,835		2,147,313
The Wendy’s Co.		223,900		1,860,609
Vail Resorts, Inc.		16,260		1,125,680
Weight Watchers International, Inc. (a)		48,392		958,162
				54,133,631
Diversified Financials 3.6%
Affiliated Managers Group, Inc. *		7,300		1,446,860
American Capital Ltd. *		46,500		697,035
Ares Capital Corp.		83,900		1,440,563
Cash America International, Inc.		29,105		1,267,523
CBOE Holdings, Inc.		22,400		1,195,264
DFC Global Corp. *		47,200		439,904
E*TRADE Financial Corp. *		92,500		2,076,625
Ezcorp, Inc., Class A *		54,300		566,349
Federated Investors, Inc., Class B (a)		88,500		2,525,790
First Cash Financial Services, Inc. *		10,690		521,351
Greenhill & Co., Inc.		19,435		974,665
IntercontinentalExchange Group, Inc.		27,600		5,642,544
Investment Technology Group, Inc. *		45,955		948,511
Janus Capital Group, Inc.		190,300		2,308,339
Lazard Ltd., Class A		28,600		1,345,630
Leucadia National Corp.		48,927		1,248,617
LPL Financial Holdings, Inc.		22,100		1,046,435
MSCI, Inc. *		49,000		1,986,460
Nelnet, Inc., Class A		16,740		707,433
Raymond James Financial, Inc.		37,300		1,853,810
SEI Investments Co.		75,200		2,434,976
Stifel Financial Corp. *		13,260		620,170
TD Ameritrade Holding Corp.		73,300		2,338,270
The NASDAQ OMX Group, Inc.		68,300		2,520,270
Waddell & Reed Financial, Inc., Class A		28,000		1,888,600
World Acceptance Corp. *(a)		9,460		686,796
				40,728,790
Energy 6.8%
Atwood Oceanics, Inc. *		18,100		897,036
Basic Energy Services, Inc. *		33,885		895,242
Bill Barrett Corp. *		42,100		996,928
Bristow Group, Inc.		16,900		1,297,920
Cabot Oil & Gas Corp.		43,500		1,708,680
CARBO Ceramics, Inc.		7,780		1,088,500
Cloud Peak Energy, Inc. *		62,200		1,224,718
Comstock Resources, Inc.		39,355		1,094,069
Concho Resources, Inc. *		13,100		1,708,895
Delek US Holdings, Inc.		39,100		1,250,809
Denbury Resources, Inc.		155,500		2,615,510

10 See financial notes

 Schwab Fundamental US Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number			Value
Security	of Shares			($)
Dresser-Rand Group, Inc. *		43,800			2,647,272
Dril-Quip, Inc. *		8,885			1,005,071
Energy XXI (Bermuda) Ltd.		32,900			787,297
EXCO Resources, Inc. (a)		182,400			1,158,240
Exterran Holdings, Inc.		64,500			2,774,790
Forest Oil Corp. *		507,200			943,392
Green Plains Renewable Energy, Inc.		29,100			870,090
Gulfmark Offshore, Inc., Class A		13,805			621,363
Helix Energy Solutions Group, Inc. *		90,200			2,168,408
Hercules Offshore, Inc. *		151,200			675,864
Hornbeck Offshore Services, Inc. *		12,980			537,761
ION Geophysical Corp. *		121,005			532,422
Key Energy Services, Inc. *		221,400			2,222,856
Matrix Service Co. *		25,000			774,250
Newpark Resources, Inc. *		56,740			683,150
Nordic American Tankers Ltd. (a)		72,685			627,272
Oceaneering International, Inc.		32,800			2,403,584
Oil States International, Inc. *		25,300			2,457,642
Parker Drilling Co. *		136,910			907,713
PDC Energy, Inc. *		10,055			640,202
Penn Virginia Corp. *		104,100			1,732,224
Pioneer Energy Services Corp. *		75,300			1,127,241
Quicksilver Resources, Inc. *(a)		375,200			1,223,152
Range Resources Corp.		23,700			2,143,665
Rosetta Resources, Inc. *		13,710			649,031
SandRidge Energy, Inc. *(a)		264,000			1,811,040
SemGroup Corp., Class A		29,200	��		1,865,296
Ship Finance International Ltd.		46,500			819,795
SM Energy Co.		25,100			1,860,663
Stone Energy Corp. *		37,800			1,854,090
Superior Energy Services, Inc.		79,800			2,627,016
Swift Energy Co. *(a)		81,805			1,008,656
Targa Resources Corp.		14,500			1,565,855
Teekay Corp.		33,100			1,857,241
TETRA Technologies, Inc. *		72,860			910,750
Tidewater, Inc.		47,500			2,419,175
Ultra Petroleum Corp. *(a)		70,700			2,106,860
Unit Corp. *		39,100			2,578,645
W&T Offshore, Inc.		45,900			881,280
Western Refining, Inc. (a)		65,100			2,831,850
Whiting Petroleum Corp. *		38,700			2,852,964
Willbros Group, Inc. *		66,800			742,148
					77,685,583
Food & Staples Retailing 0.9%
PriceSmart, Inc.		6,040			580,081
Rite Aid Corp. *		240,700			1,757,110
Roundy’s, Inc.		66,000			446,820
Susser Holdings Corp. *(a)		18,700			1,447,006
The Andersons, Inc.		26,437			1,646,761
The Fresh Market, Inc. *		12,600			467,460
The Pantry, Inc. *		134,800			2,027,392
United Natural Foods, Inc. *		35,400			2,443,662
					10,816,292
Food, Beverage & Tobacco 2.2%
B&G Foods, Inc.		18,600			610,080
Cal-Maine Foods, Inc.		14,000			834,820
Chiquita Brands International, Inc. *		149,000			1,710,520
Darling International, Inc. *		41,320			826,813
Flowers Foods, Inc.		95,250			1,954,530
Fresh Del Monte Produce, Inc.		67,600			1,952,964
J&J Snack Foods Corp.		7,135			667,836
Keurig Green Mountain, Inc.		12,280			1,150,390
Lancaster Colony Corp.		13,965			1,324,999
Monster Beverage Corp. *		27,210			1,821,982
Pilgrim’s Pride Corp. *		36,700			802,262
Post Holdings, Inc. *		24,600			1,285,596
Sanderson Farms, Inc.		21,100			1,735,897
Seaboard Corp. *		322			785,036
Snyder’s-Lance, Inc.		27,060			718,714
The Hain Celestial Group, Inc. *		8,770			754,395
The WhiteWave Foods Co., Class A *		44,100			1,221,129
TreeHouse Foods, Inc. *		15,985			1,196,318
Universal Corp.		42,400			2,313,768
Vector Group Ltd. (a)		44,707			952,259
					24,620,308
Health Care Equipment & Services 4.6%
Alere, Inc. *		42,100			1,406,140
Allscripts Healthcare Solutions, Inc. *		37,100			564,662
Amedisys, Inc. *		85,570			1,166,319
Amsurg Corp. *		21,325			923,586
Analogic Corp.		6,965			522,932
Brookdale Senior Living, Inc. *		46,700			1,486,928
Catamaran Corp. *		29,100			1,098,525
Centene Corp. *		36,500			2,423,600
Cerner Corp. *		42,300			2,169,990
Chemed Corp. (a)		22,395			1,864,832
CONMED Corp.		18,295			847,607
Edwards Lifesciences Corp. *		24,900			2,028,603
Gentiva Health Services, Inc. *		56,525			425,633
Greatbatch, Inc. *		12,700			584,581
Haemonetics Corp. *		24,400			740,784
Hanger, Inc. *		15,800			547,786
HealthSouth Corp.		27,400			949,136
Healthways, Inc. *		50,060			901,080
Hill-Rom Holdings, Inc.		50,100			1,871,736
Hologic, Inc. *		93,900			1,970,491
IDEXX Laboratories, Inc. *		19,600			2,478,224
Integra LifeSciences Holdings Corp. *		12,620			575,220
Intuitive Surgical, Inc. *		5,143			1,860,223
Invacare Corp.		65,165			1,029,607
Kindred Healthcare, Inc.		135,000			3,388,500
Masimo Corp. *		22,000			588,720
MEDNAX, Inc. *		34,800			2,061,900
Molina Healthcare, Inc. *		33,857			1,266,252
MWI Veterinary Supply, Inc. *		4,500			704,880
PharMerica Corp. *		61,740			1,678,711
ResMed, Inc. (a)		32,640			1,627,104
Select Medical Holdings Corp.		53,400			745,464
Sirona Dental Systems, Inc. *		12,190			916,932
STERIS Corp.		43,100			2,070,955
Teleflex, Inc.		23,300			2,378,697
The Cooper Cos., Inc.		10,700			1,411,437

See financial notes 11

 Schwab Fundamental US Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
VCA Antech, Inc. *		46,900		1,436,547
West Pharmaceutical Services, Inc.		26,280		1,140,026
				51,854,350
Household & Personal Products 0.4%
Central Garden & Pet Co., Class A *		151,330		1,251,499
Elizabeth Arden, Inc. *		16,770		616,130
Nu Skin Enterprises, Inc., Class A		20,120		1,750,440
Spectrum Brands Holdings, Inc.		9,500		729,885
WD-40 Co.		8,115		591,097
				4,939,051
Insurance 4.0%
Alleghany Corp. *		3,700		1,509,526
American Equity Investment Life Holding Co.		38,415		895,838
Argo Group International Holdings Ltd.		20,704		919,672
Arthur J. Gallagher & Co.		51,900		2,336,538
Aspen Insurance Holdings Ltd.		68,400		3,131,352
Assured Guaranty Ltd.		45,300		1,083,123
Brown & Brown, Inc.		44,400		1,322,232
CNO Financial Group, Inc.		163,300		2,816,925
First American Financial Corp.		85,100		2,263,660
Horace Mann Educators Corp.		20,990		631,169
Infinity Property & Casualty Corp.		17,865		1,146,397
Kemper Corp.		64,600		2,545,886
Markel Corp. *		3,082		1,929,085
Mercury General Corp.		27,300		1,306,578
Montpelier Re Holdings Ltd.		35,000		1,070,300
Old Republic International Corp.		163,000		2,699,280
Primerica, Inc.		58,200		2,670,798
ProAssurance Corp.		29,100		1,321,722
Protective Life Corp.		53,500		2,736,525
RLI Corp.		33,000		1,420,980
Safety Insurance Group, Inc.		12,105		650,160
Selective Insurance Group, Inc.		43,400		995,596
StanCorp Financial Group, Inc.		39,300		2,401,230
Stewart Information Services Corp.		20,600		628,300
Symetra Financial Corp.		39,000		805,740
The Hanover Insurance Group, Inc.		35,100		2,051,595
Tower Group International Ltd.		167,129		411,137
Validus Holdings Ltd.		58,727		2,177,010
				45,878,354
Materials 6.1%
A. Schulman, Inc.		37,533		1,348,185
A.M. Castle & Co. *		33,378		409,882
AK Steel Holding Corp. *(a)		410,800		2,875,600
AMCOL International Corp.		20,320		931,672
Axiall Corp.		29,224		1,361,838
Cabot Corp.		51,000		2,947,800
Carpenter Technology Corp.		30,600		1,921,680
Century Aluminum Co. *		78,900		1,084,875
Chemtura Corp. *		82,100		1,830,830
Clearwater Paper Corp. *		14,760		906,116
Coeur Mining, Inc. *		57,000		493,620
Compass Minerals International, Inc.		16,730		1,532,468
Crown Holdings, Inc. *		60,200		2,839,634
Eagle Materials, Inc.		11,770		980,794
Ferro Corp. *		107,630		1,397,037
Graphic Packaging Holding Co. *		132,700		1,361,502
Greif, Inc., Class A		34,100		1,847,879
H.B. Fuller Co.		37,680		1,745,714
Hecla Mining Co.		164,900		506,243
Innophos Holdings, Inc.		18,850		1,063,894
Innospec, Inc.		13,880		597,673
Kaiser Aluminum Corp.		18,180		1,279,872
KapStone Paper & Packaging Corp. *		25,000		659,500
Koppers Holdings, Inc.		15,260		651,602
Kraton Performance Polymers, Inc. *		35,700		929,985
Louisiana-Pacific Corp. *		47,300		775,247
Materion Corp.		24,060		809,619
Minerals Technologies, Inc.		23,520		1,399,205
Myers Industries, Inc.		30,005		561,094
NewMarket Corp.		4,395		1,636,346
Olin Corp. (a)		67,100		1,885,510
OM Group, Inc.		33,700		987,073
P.H. Glatfelter Co.		39,545		1,009,188
PolyOne Corp.		35,800		1,341,426
Resolute Forest Products, Inc. *		159,200		2,840,128
Rock-Tenn Co., Class A		23,700		2,265,957
Rockwood Holdings, Inc.		33,900		2,408,595
RTI International Metals, Inc. *		16,680		469,709
Schnitzer Steel Industries, Inc., Class A		91,810		2,577,107
Schweitzer-Mauduit International, Inc.		16,272		710,110
Sensient Technologies Corp.		33,100		1,789,055
Silgan Holdings, Inc.		35,000		1,741,250
Stepan Co.		14,030		811,355
Stillwater Mining Co. *		53,370		842,179
SunCoke Energy, Inc. *		39,800		830,626
The Scotts Miracle-Gro Co., Class A		41,400		2,534,094
Tredegar Corp.		22,575		469,786
W.R. Grace & Co. *		11,100		1,022,310
Walter Energy, Inc. (a)		141,000		1,015,200
Wausau Paper Corp.		55,010		657,920
Westlake Chemical Corp.		14,400		1,025,280
Worthington Industries, Inc.		40,300		1,483,040
				69,404,304
Media 2.1%
AMC Networks, Inc., Class A *		9,500		623,865
Cinemark Holdings, Inc.		68,300		2,023,046
Dex Media, Inc. *(a)		275,200		2,017,216
DreamWorks Animation SKG, Inc., Class A *		62,900		1,511,487
John Wiley & Sons, Inc., Class A		29,000		1,666,340
Lamar Advertising Co., Class A *		48,400		2,416,128
Lions Gate Entertainment Corp.		17,400		461,622
Live Nation Entertainment, Inc. *		68,800		1,436,544
Meredith Corp.		31,300		1,379,391
National CineMedia, Inc.		38,800		589,372

12 See financial notes

 Schwab Fundamental US Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Regal Entertainment Group, Class A		82,400		1,549,120
Scholastic Corp.		58,900		1,938,399
Scripps Networks Interactive, Inc., Class A		35,000		2,627,450
Sinclair Broadcast Group, Inc., Class A		21,019		561,838
Sirius XM Holdings, Inc. *		138,800		442,772
The E.W. Scripps Co., Class A *		35,200		602,976
The Madison Square Garden Co., Class A *		13,500		737,100
The New York Times Co., Class A		116,400		1,871,712
				24,456,378
Pharmaceuticals, Biotechnology & Life Sciences 2.3%
Alexion Pharmaceuticals, Inc. *		4,500		711,900
Bio-Rad Laboratories, Inc., Class A *		10,400		1,281,384
Bruker Corp. *		28,100		580,546
Cambrex Corp. *		47,300		969,177
Charles River Laboratories International, Inc. *		41,300		2,218,636
Covance, Inc. *		29,100		2,568,948
Cubist Pharmaceuticals, Inc. *		9,040		633,342
Endo International plc *		50,300		3,166,134
Illumina, Inc. *		11,860		1,611,181
Impax Laboratories, Inc. *		35,500		928,325
Myriad Genetics, Inc. *(a)		17,100		721,791
PAREXEL International Corp. *		16,420		744,647
PDL BioPharma, Inc. (a)		122,050		1,036,205
PerkinElmer, Inc.		58,500		2,455,245
Perrigo Co., plc		14,300		2,071,498
QIAGEN N.V. *		60,900		1,333,710
Techne Corp.		11,965		1,068,594
United Therapeutics Corp. *		5,800		580,058
Zoetis, Inc.		32,700		989,502
				25,670,823
Real Estate 8.5%
Alexandria Real Estate Equities, Inc.		21,500		1,587,130
American Campus Communities, Inc.		20,260		773,932
American Capital Agency Corp.		64,300		1,460,253
Anworth Mortgage Asset Corp.		150,555		812,997
Ashford Hospitality Trust, Inc.		54,085		554,912
BioMed Realty Trust, Inc.		58,500		1,222,650
Brandywine Realty Trust		101,200		1,472,460
Camden Property Trust		26,700		1,828,683
Capstead Mortgage Corp.		74,550		952,749
CBL & Associates Properties, Inc.		84,400		1,533,548
CBRE Group, Inc., Class A *		73,700		1,963,368
Chimera Investment Corp.		441,400		1,363,926
CommonWealth REIT		78,900		2,004,849
Corporate Office Properties Trust		48,400		1,294,700
Corrections Corp. of America		69,828		2,290,358
Cousins Properties, Inc.		48,283		561,531
CYS Investments, Inc.		84,800		729,280
DCT Industrial Trust, Inc.		106,200		830,484
DDR Corp.		96,900		1,663,773
DiamondRock Hospitality Co.		91,800		1,126,386
Digital Realty Trust, Inc. (a)		34,900		1,863,660
Douglas Emmett, Inc.		45,600		1,258,560
Duke Realty Corp.		151,400		2,652,528
EastGroup Properties, Inc.		9,950		629,338
EPR Properties		19,500		1,045,395
Equity Lifestyle Properties, Inc.		14,940		625,538
Essex Property Trust, Inc.		14,909		2,583,133
Extra Space Storage, Inc.		15,465		809,283
Federal Realty Investment Trust		17,400		2,045,196
Forest City Enterprises, Inc., Class A *		24,800		468,968
General Growth Properties, Inc.		122,600		2,816,122
Glimcher Realty Trust		51,025		519,945
Hatteras Financial Corp.		51,200		1,001,984
Healthcare Realty Trust, Inc.		32,700		822,405
Highwoods Properties, Inc.		34,800		1,404,180
Home Properties, Inc.		19,100		1,176,560
HomeBanc Corp. *(b)(c)		6,875		—
Inland Real Estate Corp.		45,330		473,699
Invesco Mortgage Capital, Inc.		43,100		718,477
iStar Financial, Inc. *		114,900		1,707,414
Jones Lang LaSalle, Inc.		23,100		2,677,059
Kilroy Realty Corp.		17,200		1,024,604
LaSalle Hotel Properties		31,940		1,056,575
Lexington Realty Trust		85,200		916,752
Liberty Property Trust		58,600		2,197,500
Mack-Cali Realty Corp.		94,400		1,922,928
MFA Financial, Inc.		195,600		1,551,108
Mid-America Apartment Communities, Inc.		25,021		1,742,713
National Retail Properties, Inc.		26,000		887,380
NorthStar Realty Finance Corp.		62,232		996,957
Omega Healthcare Investors, Inc.		25,190		876,108
Pennsylvania Real Estate Investment Trust		39,800		658,690
Piedmont Office Realty Trust, Inc., Class A		128,600		2,264,646
Post Properties, Inc.		13,820		693,902
Potlatch Corp.		22,100		844,883
PS Business Parks, Inc.		6,650		570,371
RAIT Financial Trust		81,820		669,288
Realty Income Corp.		30,700		1,333,915
Redwood Trust, Inc.		50,500		1,100,900
Regency Centers Corp.		33,800		1,772,134
Retail Properties of America, Inc., Class A		60,700		869,224
RLJ Lodging Trust		27,800		741,426
Ryman Hospitality Properties, Inc. (a)		15,300		696,915
Sabra Health Care REIT, Inc.		31,700		950,049
Senior Housing Properties Trust		49,500		1,161,765
SL Green Realty Corp.		19,200		2,010,432
Sovran Self Storage, Inc.		9,170		696,003
Starwood Property Trust, Inc.		23,800		572,390
Sun Communities, Inc.		11,155		508,333
Sunstone Hotel Investors, Inc.		63,200		904,392
Tanger Factory Outlet Centers, Inc.		21,780		777,110
Taubman Centers, Inc.		16,400		1,194,576
The Geo Group, Inc.		26,736		896,458
The Macerich Co.		35,500		2,304,305
UDR, Inc.		80,100		2,071,386

See financial notes 13

 Schwab Fundamental US Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Washington Real Estate Investment Trust		37,600		919,696
Weingarten Realty Investors		58,800		1,834,560
WP Carey, Inc.		12,600		774,648
				96,292,435
Retailing 5.1%
Aeropostale, Inc. *(a)		219,700		1,091,909
ANN, Inc. *		66,000		2,586,540
Asbury Automotive Group, Inc. *		23,500		1,450,890
Ascena Retail Group, Inc. *		76,600		1,317,520
Barnes & Noble, Inc. *		98,800		1,620,320
Brown Shoe Co., Inc.		50,342		1,187,568
Cabela’s, Inc. *		12,100		793,881
Chico’s FAS, Inc.		127,000		2,016,760
DSW, Inc., Class A		24,836		829,274
Express, Inc. *		46,200		673,134
Fred’s, Inc., Class A		84,970		1,548,153
Genesco, Inc. *		19,900		1,519,763
GNC Holdings, Inc., Class A		25,000		1,125,000
Group 1 Automotive, Inc.		30,000		2,163,900
Guess?, Inc.		74,400		2,002,104
hhgregg, Inc. *(a)		35,400		305,148
Hibbett Sports, Inc. *		13,285		715,397
HSN, Inc.		17,800		1,033,112
Jos. A. Bank Clothiers, Inc. *		17,885		1,154,477
Lithia Motors, Inc., Class A		13,035		968,240
LKQ Corp. *		66,700		1,942,304
Lumber Liquidators Holdings, Inc. *		5,100		444,516
Monro Muffler Brake, Inc.		13,340		752,376
Netflix, Inc. *		4,200		1,352,568
Nutrisystem, Inc.		70,530		1,057,950
Office Depot, Inc. *		661,858		2,706,999
Outerwall, Inc. *(a)		16,725		1,159,879
Penske Automotive Group, Inc.		43,800		2,008,668
Pier 1 Imports, Inc.		35,685		651,608
Pool Corp.		19,780		1,167,416
Sally Beauty Holdings, Inc. *		32,365		887,125
Sears Hometown & Outlet Stores, Inc. *		26,000		613,860
Select Comfort Corp. *		25,570		470,488
Sonic Automotive, Inc., Class A		66,000		1,606,440
Stage Stores, Inc.		53,655		1,029,103
The Bon-Ton Stores, Inc. (a)		37,900		416,900
The Buckle, Inc. (a)		21,422		1,006,620
The Cato Corp., Class A		29,695		846,010
The Children’s Place Retail Stores, Inc.		33,960		1,630,080
The Finish Line, Inc., Class A		54,152		1,490,804
The Men’s Wearhouse, Inc.		58,100		2,752,778
The Pep Boys - Manny, Moe & Jack *		75,215		768,697
The Wet Seal, Inc., Class A *(a)		191,860		216,802
TripAdvisor, Inc. *		7,500		605,550
Ulta Salon, Cosmetics & Fragrance, Inc. *		11,000		964,810
Urban Outfitters, Inc. *		66,600		2,374,623
Vitamin Shoppe, Inc. *		13,300		636,804
				57,664,868
Semiconductors & Semiconductor Equipment 4.4%
Advanced Micro Devices, Inc. *(a)		636,000		2,601,240
Amkor Technology, Inc. *		183,400		1,458,030
Atmel Corp. *		301,200		2,340,324
Avago Technologies Ltd.		56,300		3,575,050
Brooks Automation, Inc.		74,190		758,964
Cabot Microelectronics Corp. *		15,930		690,884
Cirrus Logic, Inc. *		31,535		703,231
Cree, Inc. *		17,000		801,890
Cypress Semiconductor Corp. *		141,305		1,338,158
Diodes, Inc. *		19,900		524,763
Entegris, Inc. *		95,845		1,062,921
Fairchild Semiconductor International, Inc. *		123,500		1,572,155
First Solar, Inc. *		37,400		2,524,126
GT Advanced Technologies, Inc. *(a)		143,100		2,376,891
Hittite Microwave Corp.		7,700		457,072
Integrated Device Technology, Inc. *		125,880		1,469,020
International Rectifier Corp. *		42,300		1,101,492
Intersil Corp., Class A		176,000		2,171,840
Micrel, Inc.		51,250		510,450
Microsemi Corp. *		24,945		586,706
MKS Instruments, Inc.		37,850		1,065,477
OmniVision Technologies, Inc. *		45,580		890,177
ON Semiconductor Corp. *		241,600		2,273,456
Photronics, Inc. *		67,525		586,117
PMC-Sierra, Inc. *		99,925		683,487
RF Micro Devices, Inc. *		168,745		1,424,208
Semtech Corp. *		21,005		503,700
Silicon Laboratories, Inc. *		35,290		1,586,285
Skyworks Solutions, Inc. *		45,700		1,875,985
Spansion, Inc., Class A *		50,700		903,981
SunEdison, Inc. *		201,100		3,867,153
Synaptics, Inc. *		14,805		920,131
Teradyne, Inc. *		97,700		1,726,359
Tessera Technologies, Inc.		28,190		618,207
TriQuint Semiconductor, Inc. *		94,560		1,340,861
Veeco Instruments, Inc. *		20,460		756,406
				49,647,197
Software & Services 5.8%
Activision Blizzard, Inc.		130,800		2,617,308
Acxiom Corp. *		44,815		1,265,576
Akamai Technologies, Inc. *		40,700		2,159,949
ANSYS, Inc. *		12,100		923,351
CACI International, Inc., Class A *		30,400		2,117,360
Cadence Design Systems, Inc. *		38,500		599,060
Compuware Corp.		191,400		1,982,904
Convergys Corp.		134,800		2,903,592
Conversant, Inc. *		49,280		1,204,403
CSG Systems International, Inc.		39,445		1,039,770
Digital River, Inc. *		39,700		607,013
EarthLink Holdings Corp.		293,275		1,000,068
Electronic Arts, Inc. *		72,300		2,046,090
Equinix, Inc. *		6,800		1,277,108
Euronet Worldwide, Inc. *		18,195		836,788
Facebook, Inc., Class A *		43,100		2,576,518
FactSet Research Systems, Inc.		17,765		1,891,972

14 See financial notes

 Schwab Fundamental US Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Fair Isaac Corp.		30,705		1,756,326
FleetCor Technologies, Inc. *		5,000		570,650
Gartner, Inc. *		19,900		1,371,906
Genpact Ltd. *		52,750		889,365
Global Cash Access Holdings, Inc. *		75,035		495,231
Global Payments, Inc.		28,700		1,918,021
Heartland Payment Systems, Inc.		23,165		948,375
Informatica Corp. *		16,455		583,330
j2 Global, Inc.		13,985		648,345
Jack Henry & Associates, Inc.		26,480		1,460,637
Manhattan Associates, Inc. *		26,480		834,914
ManTech International Corp., Class A		40,100		1,196,183
MAXIMUS, Inc.		26,380		1,122,997
Mentor Graphics Corp.		30,020		621,414
MICROS Systems, Inc. *		22,040		1,135,060
MicroStrategy, Inc., Class A *		4,528		549,835
Monster Worldwide, Inc. *		271,400		1,869,946
NeuStar, Inc., Class A *		30,075		773,529
Nuance Communications, Inc. *		50,400		810,936
Progress Software Corp. *		34,125		732,323
PTC, Inc. *		33,440		1,182,773
Rackspace Hosting, Inc. *		17,720		514,234
Red Hat, Inc. *		19,200		934,080
Rovi Corp. *		31,169		694,757
Salesforce.com, Inc. *		20,039		1,035,014
Sapient Corp. *		46,380		754,603
Solera Holdings, Inc.		12,860		833,071
Sykes Enterprises, Inc. *		42,655		844,142
Synopsys, Inc. *		43,600		1,640,232
Take-Two Interactive Software, Inc. *		45,855		934,525
TeleTech Holdings, Inc. *		22,810		550,405
TIBCO Software, Inc. *		70,830		1,390,393
Unisys Corp. *		52,200		1,272,114
United Online, Inc.		54,689		648,065
VeriFone Systems, Inc. *		25,600		856,064
VeriSign, Inc. *		45,800		2,160,844
Vistaprint N.V. *		13,020		513,899
VMware, Inc., Class A *		6,200		573,562
WEX, Inc. *		8,000		767,760
				65,438,690
Technology Hardware & Equipment 4.7%
ADTRAN, Inc.		45,845		1,028,303
ARRIS Group, Inc. *		60,905		1,589,011
Belden, Inc.		18,940		1,397,961
Benchmark Electronics, Inc. *		93,700		2,171,966
Brocade Communications Systems, Inc. *		260,900		2,428,979
Cognex Corp. *		16,530		569,128
Coherent, Inc. *		15,240		909,980
Comtech Telecommunications Corp.		28,370		900,748
Diebold, Inc.		66,900		2,516,109
Dolby Laboratories, Inc., Class A *		22,100		880,685
EchoStar Corp., Class A *		18,500		831,760
Electronics for Imaging, Inc. *		25,102		948,605
Emulex Corp. *		100,665		719,755
F5 Networks, Inc. *		18,140		1,907,784
FEI Co.		7,220		574,134
Finisar Corp. *		36,730		960,489
FLIR Systems, Inc.		66,700		2,270,468
Insight Enterprises, Inc. *		91,600		2,392,592
InterDigital, Inc.		21,300		739,536
Itron, Inc. *		38,900		1,478,200
JDS Uniphase Corp. *		85,400		1,082,018
Littelfuse, Inc.		8,545		773,750
MTS Systems Corp.		8,780		566,047
National Instruments Corp.		33,742		921,494
NCR Corp. *		68,900		2,102,139
NETGEAR, Inc. *		22,950		741,285
OSI Systems, Inc. *		7,800		435,318
Plantronics, Inc.		20,410		889,264
Plexus Corp. *		43,880		1,839,450
Polycom, Inc. *		139,840		1,720,032
QLogic Corp. *		190,080		2,201,126
Rofin-Sinar Technologies, Inc. *		28,410		630,702
Sanmina Corp. *		127,100		2,573,775
ScanSource, Inc. *		37,040		1,422,706
SYNNEX Corp. *		47,400		3,193,812
Trimble Navigation Ltd. *		44,600		1,713,978
ViaSat, Inc. *		8,415		540,327
Zebra Technologies Corp., Class A *		36,120		2,508,173
				53,071,589
Telecommunication Services 0.9%
Cincinnati Bell, Inc. *		357,800		1,198,630
Consolidated Communications Holdings, Inc.		40,014		797,079
Intelsat S.A. *		28,800		523,584
Level 3 Communications, Inc. *		59,100		2,543,073
NTELOS Holdings Corp. (a)		35,220		485,684
SBA Communications Corp., Class A *		14,405		1,292,992
T-Mobile US, Inc. *		30,900		905,061
tw telecom, Inc. *		48,000		1,473,120
United States Cellular Corp.		18,000		747,720
				9,966,943
Transportation 3.7%
Alaska Air Group, Inc.		29,700		2,794,176
Allegiant Travel Co.		5,200		610,740
AMERCO		3,300		825,363
ArcBest Corp.		42,040		1,657,217
Atlas Air Worldwide Holdings, Inc. *		27,700		969,223
Con-way, Inc.		57,200		2,429,856
Copa Holdings S.A., Class A		8,500		1,149,880
Delta Air Lines, Inc.		66,300		2,441,829
Forward Air Corp.		16,625		735,324
Genesee & Wyoming, Inc., Class A *		5,965		590,595
Hawaiian Holdings, Inc. *		68,040		983,178
Heartland Express, Inc.		43,465		945,798
Hub Group, Inc., Class A *		34,010		1,518,547
JetBlue Airways Corp. *		227,300		1,796,806
Kansas City Southern		20,700		2,088,216
Kirby Corp. *		17,200		1,730,664

See financial notes 15

 Schwab Fundamental US Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Knight Transportation, Inc.		50,725		1,203,704
Landstar System, Inc.		35,170		2,215,358
Matson, Inc.		63,300		1,499,577
Old Dominion Freight Line, Inc. *		23,675		1,435,415
Republic Airways Holdings, Inc. *		119,500		993,045
Saia, Inc. *		17,250		710,183
SkyWest, Inc.		178,900		2,075,240
Southwest Airlines Co.		114,300		2,762,631
Swift Transportation Co. *		35,200		846,560
United Continental Holdings, Inc. *		51,500		2,104,805
UTi Worldwide, Inc.		135,200		1,323,608
Werner Enterprises, Inc.		65,400		1,674,240
				42,111,778
Utilities 3.5%
ALLETE, Inc.		23,900		1,237,064
American States Water Co.		18,530		562,571
Aqua America, Inc.		63,475		1,592,588
Atlantic Power Corp. (a)		221,600		658,152
Avista Corp.		55,100		1,771,465
Black Hills Corp.		26,900		1,553,475
California Water Service Group		27,680		622,800
Cleco Corp.		33,300		1,749,915
El Paso Electric Co.		34,190		1,293,066
Hawaiian Electric Industries, Inc.		86,200		2,067,938
IDACORP, Inc.		28,600		1,605,604
ITC Holdings Corp.		42,400		1,567,528
MGE Energy, Inc.		20,250		773,955
New Jersey Resources Corp.		36,000		1,790,280
Northwest Natural Gas Co.		26,305		1,164,522
NorthWestern Corp.		29,800		1,441,724
Otter Tail Corp.		33,280		975,104
Piedmont Natural Gas Co., Inc.		58,700		2,100,873
PNM Resources, Inc.		73,500		2,034,480
Portland General Electric Co.		71,500		2,393,105
South Jersey Industries, Inc.		15,740		904,263
Southwest Gas Corp.		37,800		2,079,378
The Empire District Electric Co.		38,110		926,835
The Laclede Group, Inc.		24,940		1,182,405
UIL Holdings Corp.		33,000		1,212,090
UNS Energy Corp.		31,500		1,891,890
WGL Holdings, Inc.		53,100		2,112,849
				39,265,919
Total Common Stock
(Cost $849,941,868)				1,115,345,025
Rights 0.0% of net assets
Technology Hardware & Equipment 0.0%
Gerber Scientific, Inc. CVR *(a)(b)(c)		19,700		—
Telecommunication Services 0.0%
Contra Leap Wireless CVR *(b)(c)		105,700		266,364
Total Rights
(Cost $266,856)				266,364
Other Investment Company 1.3% of net assets
Money Market Fund 1.3%
State Street Institutional U.S. Government Money Market Fund, Institutional Class 0.00% (f)		14,922,078		14,922,078
Total Other Investment Company
(Cost $14,922,078)				14,922,078
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investment 0.3% of net assets
U.S. Treasury Obligation 0.3%
U.S. Treasury Bill
0.05%, 06/19/14 (d)(e)		3,050,000		3,049,793
Total Short-Term Investment
(Cost $3,049,793)				3,049,793
End of Investments.
	Number		Value
Security	of Shares		($)
Collateral Invested for Securities on Loan 2.7% of net assets
State Street Institutional U.S. Government Money Market Fund, Institutional Class 0.00% (f)		30,398,073		30,398,073
Total Collateral Invested for Securities on Loan
(Cost $30,398,073)				30,398,073
End of Collateral Invested for Securities on Loan

At 04/30/14 tax basis cost of the fund’s investments was $871,766,214 and the unrealized appreciation and depreciation were $278,770,901 and ($16,953,855), respectively, with a net unrealized appreciation of $261,817,046.

*	Non-income producing security.
(a)	All or a portion of this security is on loan. Securities on loan were valued at $32,086,117.
(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 $266,364 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.
(f)	The rate shown is the 7-day yield.

CVR —	Contingent Value Rights
REIT —	Real Estate Investment Trust

16 See financial notes

 Schwab Fundamental US Small Company Index Fund

Portfolio Holdings (Unaudited) continued

In addition to the above, the fund held the following at 04/30/14:

			Contract		Unrealized
	Number of		Value		Depreciation
	Contracts		($)		($)
Futures Contracts
Russell 2000 Index, mini, Long, expires 06/20/14		160		17,977,600		(414,961	)

See financial notes 17

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings as of April 30, 2014 (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		654,983,799		826,627,338
	0	.4%	Preferred Stock		2,226,152		3,612,619
	0	.0%	Rights		228,127		233,309
	0	.0%	Warrants		140,410		203,445
	0	.0%	Other Investment Company		4,656		6,832
	1	.5%	Short-Term Investments		12,115,904		12,115,904
	99	.5%	Total Investments		669,699,048		842,799,447
	3	.0%	Collateral Invested for Securities on Loan		25,081,669		25,081,669
	(2	.5%)	Other Assets and Liabilities, Net				(20,828,764	)
	100	.0%	Net Assets				847,052,352

	Number		Value
Security	of Shares		($)
Common Stock 97.6% of net assets
Australia 5.0%
Banks 1.4%
Australia & New Zealand Banking Group Ltd.		87,091		2,800,652
Commonwealth Bank of Australia		42,901		3,155,836
National Australia Bank Ltd.		89,358		2,942,324
Westpac Banking Corp.		88,495		2,898,611
				11,797,423
Capital Goods 0.1%
Leighton Holdings Ltd.		13,052		232,093
UGL Ltd.		28,386		178,520
				410,613
Commercial & Professional Supplies 0.1%
Brambles Ltd.		69,667		612,601
Downer EDI Ltd.		50,205		234,372
				846,973
Consumer Services 0.1%
Crown Resorts Ltd.		14,738		220,535
Tabcorp Holdings Ltd.		135,949		471,153
Tatts Group Ltd.		103,663		291,560
				983,248
Diversified Financials 0.1%
BGP Holdings plc (a)(b)		453,854		—
Macquarie Group Ltd.		12,339		664,774
				664,774
Energy 0.3%
Caltex Australia Ltd.		20,634		428,328
Origin Energy Ltd.		45,479		631,789
Santos Ltd.		29,233		374,807
Woodside Petroleum Ltd.		20,014		760,755
WorleyParsons Ltd.		14,581		228,653
				2,424,332
Food & Staples Retailing 0.6%
Metcash Ltd.		120,536		311,299
Wesfarmers Ltd.		65,258		2,597,209
Woolworths Ltd.		67,532		2,346,870
				5,255,378
Food, Beverage & Tobacco 0.0%
Coca-Cola Amatil Ltd.		24,599		212,357
Health Care Equipment & Services 0.0%
Sonic Healthcare Ltd.		16,086		265,341
Insurance 0.3%
AMP Ltd.		113,607		534,653
Insurance Australia Group Ltd.		68,906		368,286
QBE Insurance Group Ltd.		81,713		881,898
Suncorp Group Ltd.		92,333		1,121,309
				2,906,146
Materials 1.3%
Amcor Ltd.		50,088		480,693
Arrium Ltd.		323,201		360,193
BHP Billiton Ltd.		168,814		5,945,054
BlueScope Steel Ltd. *		101,091		611,175
Boral Ltd.		66,329		352,019
CSR Ltd.		76,534		260,645
Incitec Pivot Ltd.		107,981		289,850
Newcrest Mining Ltd. *		39,720		387,396
Orica Ltd.		24,733		504,764
Rio Tinto Ltd.		27,104		1,563,066
Sims Metal Management Ltd. *		38,441		351,569
				11,106,424
Media 0.0%
Fairfax Media Ltd.		330,784		302,229
Pharmaceuticals, Biotechnology & Life Sciences 0.1%
CSL Ltd.		10,270		654,716
Real Estate 0.2%
Lend Lease Group		35,563		429,814
Mirvac Group		127,157		207,501
Stockland		114,450		414,897
Westfield Group		86,387		881,515
				1,933,727
Telecommunication Services 0.2%
Telstra Corp., Ltd.		285,764		1,389,415
Transportation 0.1%
Asciano Ltd.		49,927		251,951
Qantas Airways Ltd. *		269,760		306,861
Sydney Airport		71,229		279,893
Toll Holdings Ltd.		68,523		337,996
				1,176,701

18 See financial notes

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Utilities 0.1%
AGL Energy Ltd.		25,914		380,417
				42,710,214
Austria 0.4%
Banks 0.1%
Erste Group Bank AG		30,412		1,022,584
Capital Goods 0.1%
Andritz AG		3,086		191,700
Wienerberger AG		12,883		239,126
				430,826
Energy 0.1%
OMV AG		17,029		796,181
Materials 0.1%
Voestalpine AG		12,318		562,679
Telecommunication Services 0.0%
Telekom Austria AG		41,194		408,812
				3,221,082
Belgium 0.9%
Banks 0.1%
KBC Groep N.V.		9,376		572,150
Food & Staples Retailing 0.2%
Colruyt S.A.		4,914		277,865
Delhaize Group S.A.		20,535		1,529,103
				1,806,968
Food, Beverage & Tobacco 0.2%
Anheuser-Busch InBev N.V.		19,681		2,145,147
Insurance 0.1%
Ageas		16,931		728,638
Materials 0.2%
Bekaert N.V.		7,995		325,380
Solvay S.A.		3,267		529,434
Umicore S.A.		10,909		534,745
				1,389,559
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
UCB S.A.		4,258		349,269
Telecommunication Services 0.1%
Belgacom S.A.		18,703		572,453
				7,564,184
Canada 6.2%
Automobiles & Components 0.2%
Magna International, Inc.		15,954		1,563,013
Banks 1.3%
Bank of Montreal		22,997		1,585,168
Bank of Nova Scotia		35,232		2,140,825
Canadian Imperial Bank of Commerce		14,041		1,251,846
National Bank of Canada		11,382		472,394
Royal Bank of Canada		46,126		3,078,433
The Toronto-Dominion Bank		51,152		2,460,878
				10,989,544
Capital Goods 0.1%
Bombardier, Inc., Class B		98,792		397,493
Finning International, Inc.		12,126		327,476
SNC-Lavalin Group, Inc.		5,879		266,688
				991,657
Consumer Services 0.0%
Tim Hortons, Inc.		4,960		272,064
Diversified Financials 0.1%
IGM Financial, Inc.		4,431		220,691
Onex Corp.		6,110		348,968
				569,659
Energy 2.0%
ARC Resources Ltd.		10,292		305,365
Baytex Energy Corp. (c)		4,816		200,452
Bonavista Energy Corp.		12,563		197,377
Cameco Corp.		12,319		262,216
Canadian Natural Resources Ltd.		45,617		1,858,725
Canadian Oil Sands Ltd.		41,539		900,476
Cenovus Energy, Inc.		40,898		1,218,302
Crescent Point Energy Corp. (c)		7,458		303,410
Enbridge, Inc.		20,308		979,965
Encana Corp.		122,156		2,829,744
Enerplus Corp. (c)		17,692		392,402
Husky Energy, Inc.		21,855		714,243
Imperial Oil Ltd.		15,920		777,372
Pengrowth Energy Corp.		57,430		373,068
Penn West Petroleum Ltd.		71,861		649,735
Suncor Energy, Inc.		65,926		2,543,088
Talisman Energy, Inc.		92,178		952,855
TransCanada Corp.		29,027		1,352,766
				16,811,561
Food & Staples Retailing 0.3%
Alimentation Couche-Tard, Inc., Class B		24,792		698,714
Empire Co., Ltd, Class A		4,172		263,897
George Weston Ltd.		4,425		333,394
Loblaw Cos., Ltd.		16,542		719,152
Metro, Inc.		8,649		533,120
				2,548,277
Food, Beverage & Tobacco 0.0%
Saputo, Inc.		5,641		301,646
Insurance 0.5%
Fairfax Financial Holdings Ltd.		900		392,418
Great-West Lifeco, Inc.		10,259		288,662
Intact Financial Corp.		3,445		226,209
Manulife Financial Corp.		65,178		1,223,816
Power Corp. of Canada		27,500		774,280
Power Financial Corp.		13,593		431,831
Sun Life Financial, Inc.		20,211		684,119
				4,021,335
Materials 0.6%
Agrium, Inc.		6,814		654,450
Barrick Gold Corp.		68,677		1,198,660
First Quantum Minerals Ltd.		15,378		306,283
Goldcorp, Inc.		19,237		475,111
Kinross Gold Corp.		60,594		246,014
Potash Corp. of Saskatchewan, Inc.		37,100		1,341,090
Teck Resources Ltd., Class B		34,358		783,051

See financial notes 19

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Yamana Gold, Inc.		18,826		141,017
				5,145,676
Media 0.1%
Shaw Communications, Inc., Class B		16,152		391,256
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
Valeant Pharmaceuticals International, Inc. *		2,400		320,942
Real Estate 0.1%
Brookfield Asset Management, Inc., Class A		26,309		1,104,400
Retailing 0.1%
Canadian Tire Corp., Ltd., Class A		4,127		405,339
RONA, Inc.		23,435		236,263
				641,602
Software & Services 0.0%
CGI Group, Inc., Class A *		9,573		345,171
Technology Hardware & Equipment 0.2%
Blackberry Ltd. *		120,218		918,046
Celestica, Inc. *		26,838		297,751
				1,215,797
Telecommunication Services 0.3%
BCE, Inc.		22,653		1,008,591
Rogers Communications, Inc., Class B		17,008		675,478
Telus Corp.		17,018		599,640
				2,283,709
Transportation 0.2%
Canadian National Railway Co.		24,155		1,414,854
Canadian Pacific Railway Ltd.		2,582		403,160
				1,818,014
Utilities 0.1%
Canadian Utilities Ltd., Class A		6,133		226,564
Fortis, Inc.		10,188		299,305
TransAlta Corp.		24,091		294,310
				820,179
				52,155,502
Denmark 0.9%
Banks 0.1%
Danske Bank A/S		30,560		864,641
Capital Goods 0.1%
FLSmidth & Co. A/S		3,873		207,351
Vestas Wind Systems A/S *		13,458		597,684
				805,035
Food, Beverage & Tobacco 0.1%
Carlsberg A/S, Class B		5,161		516,267
Pharmaceuticals, Biotechnology & Life Sciences 0.2%
Novo Nordisk A/S, Class B		39,550		1,795,016
Telecommunication Services 0.1%
TDC A/S		70,023		657,279
Transportation 0.3%
AP Moeller - Maersk A/S, Series A		445		1,010,981
AP Moeller - Maersk A/S, Series B		735		1,754,634
DSV A/S		8,170		272,871
				3,038,486
				7,676,724
Finland 1.3%
Capital Goods 0.1%
Kone Oyj, Class B		7,133		305,759
Metso Oyj		12,441		500,747
Wartsila Oyj Abp		7,190		401,382
				1,207,888
Energy 0.1%
Neste Oil Oyj		17,697		363,368
Food & Staples Retailing 0.1%
Kesko Oyj, B Shares		16,298		667,120
Insurance 0.1%
Sampo Oyj, A Shares (c)		13,495		670,696
Materials 0.2%
Stora Enso Oyj, R Shares		64,471		658,353
UPM-Kymmene Oyj		66,729		1,168,678
				1,827,031
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
Orion Oyj, Class B		8,519		260,023
Technology Hardware & Equipment 0.6%
Nokia Oyj *		632,078		4,732,728
Telecommunication Services 0.0%
Elisa Oyj		9,839		293,887
Utilities 0.1%
Fortum Oyj		29,194		659,553
				10,682,294
France 11.7%
Automobiles & Components 0.5%
Peugeot S.A. *		105,959		1,874,727
Renault S.A.		17,250		1,686,530
Valeo S.A.		4,736		650,391
				4,211,648
Banks 1.0%
BNP Paribas S.A.		63,868		4,799,326
Credit Agricole S.A. *		80,252		1,266,252
Societe Generale S.A.		43,140		2,686,638
				8,752,216
Capital Goods 1.8%
Airbus Group N.V.		10,673		733,663
Alstom S.A.		18,594		768,378
Bouygues S.A. (c)		33,535		1,510,447
Compagnie de Saint-Gobain		61,846		3,789,023
Eiffage S.A.		7,696		581,756
Legrand S.A.		8,937		577,474
Nexans S.A.		4,893		275,484
Rexel S.A.		14,749		372,409
Safran S.A.		7,232		486,729
Schneider Electric S.A.		25,464		2,390,329
Thales S.A.		4,399		280,107

20 See financial notes

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Vallourec S.A.		13,656		807,008
Vinci S.A. (c)		37,737		2,849,382
				15,422,189
Consumer Durables & Apparel 0.4%
Christian Dior S.A.		2,457		505,542
Kering		3,824		845,759
LVMH Moet Hennessy Louis Vuitton S.A.		8,220		1,619,293
				2,970,594
Consumer Services 0.1%
Accor S.A.		15,242		746,242
Sodexo		4,234		456,488
				1,202,730
Diversified Financials 0.0%
Wendel S.A.		1,358		204,712
Energy 2.3%
CGG S.A. *		14,820		256,413
Technip S.A.		4,276		481,300
Total S.A.		267,352		19,127,473
				19,865,186
Food & Staples Retailing 0.5%
Carrefour S.A.		84,569		3,296,588
Casino Guichard Perrachon S.A.		6,376		812,450
Rallye S.A.		7,189		365,656
				4,474,694
Food, Beverage & Tobacco 0.3%
Danone S.A.		22,945		1,694,236
Pernod-Ricard S.A.		6,619		794,336
				2,488,572
Health Care Equipment & Services 0.1%
Essilor International S.A.		4,335		464,224
Household & Personal Products 0.1%
L’Oreal S.A.		5,984		1,031,313
Insurance 0.5%
AXA S.A.		124,494		3,248,797
CNP Assurances		10,437		240,777
SCOR SE		8,962		327,944
				3,817,518
Materials 0.4%
Air Liquide S.A.		12,292		1,758,585
Arkema S.A.		3,873		432,584
Lafarge S.A.		16,288		1,490,333
				3,681,502
Media 0.1%
Eutelsat Communications S.A.		6,683		229,885
Publicis Groupe S.A.		3,969		339,545
Solocal Group *		80,923		184,759
				754,189
Pharmaceuticals, Biotechnology & Life Sciences 0.8%
Sanofi		59,085		6,376,444
Software & Services 0.1%
AtoS		2,163		186,866
Cap Gemini S.A.		10,627		750,836
				937,702
Technology Hardware & Equipment 0.1%
Alcatel-Lucent *		146,399		580,578
Telecommunication Services 1.5%
Orange S.A.		552,437		8,950,182
Vivendi S.A.		151,219		4,062,763
				13,012,945
Transportation 0.1%
Air France-KLM *		74,812		1,076,248
Utilities 1.0%
Electricite de France		29,508		1,133,134
GDF Suez (c)		180,020		4,537,121
Suez Environnement Co.		34,153		671,090
Veolia Environnement S.A. (c)		96,327		1,797,066
				8,138,411
				99,463,615
Germany 8.9%
Automobiles & Components 1.3%
Bayerische Motoren Werke AG		20,043		2,519,504
Continental AG		4,004		942,159
Daimler AG - Reg’d		73,177		6,812,715
Volkswagen AG		1,519		407,318
				10,681,696
Banks 0.1%
Commerzbank AG *		34,391		613,232
Capital Goods 0.9%
Brenntag AG		2,532		458,673
GEA Group AG		7,303		327,089
Hochtief AG		2,661		248,100
Kloeckner & Co. SE *		19,174		290,603
MAN SE		2,171		278,389
MTU Aero Engines AG		1,826		172,167
Rheinmetall AG		3,543		236,033
Siemens AG - Reg’d		45,683		6,026,512
				8,037,566
Commercial & Professional Supplies 0.0%
Bilfinger SE		3,077		366,856
Consumer Durables & Apparel 0.1%
adidas AG		8,198		876,380
Consumer Services 0.0%
TUI AG		21,740		361,996
Diversified Financials 0.4%
Deutsche Bank AG - Reg’d		57,956		2,552,699
Deutsche Boerse AG		7,678		563,050
				3,115,749
Food & Staples Retailing 0.1%
Metro AG *		29,450		1,179,877
Health Care Equipment & Services 0.2%
Celesio AG		15,313		532,193
Fresenius Medical Care AG & Co. KGaA		7,770		535,334
Fresenius SE & Co. KGaA		5,590		850,534
				1,918,061
Household & Personal Products 0.1%
Beiersdorf AG		2,782		279,270

See financial notes 21

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Henkel AG & Co. KGaA		3,544		364,388
				643,658
Insurance 0.9%
Allianz SE - Reg’d		26,886		4,678,966
Hannover Rueck SE		3,325		309,830
Muenchener Rueckversicherungs AG - Reg’d (c)		9,935		2,296,564
				7,285,360
Materials 1.6%
Aurubis AG		5,759		307,672
BASF SE		63,614		7,379,587
HeidelbergCement AG		10,749		933,960
K&S AG - Reg’d		16,578		580,895
LANXESS AG		6,391		486,684
Linde AG		6,722		1,396,057
Salzgitter AG		10,017		425,480
ThyssenKrupp AG *		62,123		1,773,125
				13,283,460
Media 0.0%
Kabel Deutschland Holding AG		1,519		205,723
Pharmaceuticals, Biotechnology & Life Sciences 0.5%
Bayer AG - Reg’d		31,374		4,362,293
Merck KGaA		1,571		265,568
				4,627,861
Semiconductors & Semiconductor Equipment 0.1%
Infineon Technologies AG		38,449		447,057
Software & Services 0.2%
SAP AG		18,940		1,530,864
Telecommunication Services 0.8%
Deutsche Telekom AG - Reg’d		396,393		6,659,822
Freenet AG		7,797		270,034
				6,929,856
Transportation 0.4%
Deutsche Lufthansa AG - Reg’d		33,650		845,046
Deutsche Post AG - Reg’d		64,336		2,427,587
				3,272,633
Utilities 1.2%
E.ON SE		338,535		6,484,586
RWE AG		89,441		3,413,165
				9,897,751
				75,275,636
Hong Kong 0.9%
Banks 0.1%
Hang Seng Bank Ltd.		26,500		432,640
Capital Goods 0.3%
Hutchison Whampoa Ltd.		91,000		1,248,474
Jardine Matheson Holdings Ltd.		9,600		599,360
Jardine Strategic Holdings Ltd.		6,500		232,550
Noble Group Ltd.		640,879		659,900
				2,740,284
Consumer Durables & Apparel 0.1%
Li & Fung Ltd.		312,000		454,140
Diversified Financials 0.0%
Hong Kong Exchanges & Clearing Ltd.		11,800		212,203
Insurance 0.1%
AIA Group Ltd.		139,200		677,012
Real Estate 0.1%
Cheung Kong (Holdings) Ltd.		28,000		478,166
Sun Hung Kai Properties Ltd.		16,000		201,889
Swire Pacific Ltd., Class A		33,000		381,133
The Link REIT		37,500		186,703
Wharf Holdings Ltd.		29,000		203,583
				1,451,474
Retailing 0.1%
Esprit Holdings Ltd.		305,584		508,772
Telecommunication Services 0.0%
PCCW Ltd.		365,000		194,907
Utilities 0.1%
CLP Holdings Ltd.		85,000		679,527
Hong Kong & China Gas Co., Ltd.		95,214		219,698
Power Assets Holdings Ltd.		28,000		242,042
				1,141,267
				7,812,699
Ireland 0.7%
Banks 0.1%
Bank of Ireland *		1,373,644		536,341
Capital Goods 0.0%
DCC plc		6,462		330,913
Commercial & Professional Supplies 0.1%
Experian plc		25,671		493,576
Food, Beverage & Tobacco 0.0%
Kerry Group plc, Class A		4,068		321,129
Materials 0.3%
CRH plc		68,799		2,002,984
Smurfit Kappa Group plc		17,033		379,456
				2,382,440
Pharmaceuticals, Biotechnology & Life Sciences 0.1%
Shire plc		7,678		439,120
Technology Hardware & Equipment 0.1%
Seagate Technology plc		18,364		965,579
				5,469,098
Israel 0.3%
Banks 0.0%
Bank Leumi Le-Israel B.M. *		65,973		258,137
Materials 0.0%
Israel Chemicals Ltd.		32,147		285,313
Pharmaceuticals, Biotechnology & Life Sciences 0.2%
Teva Pharmaceutical Industries Ltd.		37,689		1,847,513

22 See financial notes

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Telecommunication Services 0.1%
Bezeq The Israeli Telecommunication Corp., Ltd.		249,141		451,500
				2,842,463
Italy 4.9%
Automobiles & Components 0.2%
Fiat S.p.A. *		145,178		1,752,695
Pirelli & C. S.p.A		16,232		273,284
				2,025,979
Banks 1.5%
Banca Monte dei Paschi di Siena S.p.A. *		2,932,747		980,185
Banca Popolare dell’Emilia Romagna SC *(c)		28,405		327,421
Banca Popolare Di Milano Scarl *		277,034		280,165
Banco Popolare SC *		28,283		584,508
Intesa Sanpaolo S.p.A.		1,328,656		4,546,699
Intesa Sanpaolo S.p.A. - RSP		82,866		241,454
UniCredit S.p.A.		568,807		5,096,308
Unione di Banche Italiane S.C.P.A.		84,143		803,187
				12,859,927
Capital Goods 0.2%
CNH Industrial N.V.		51,053		596,359
Finmeccanica S.p.A. *		78,246		724,122
Prysmian S.p.A.		11,500		299,514
				1,619,995
Diversified Financials 0.1%
Exor S.p.A.		8,992		410,988
Mediobanca S.p.A. *		39,407		437,381
				848,369
Energy 1.1%
Eni S.p.A.		350,949		9,089,339
Saipem S.p.A.		21,114		566,339
				9,655,678
Insurance 0.2%
Assicurazioni Generali S.p.A.		60,998		1,426,212
Materials 0.0%
Italcementi S.p.A. (c)		29,368		356,795
Media 0.1%
Mediaset S.p.A. *		103,408		572,277
Telecommunication Services 0.6%
Telecom Italia S.p.A. *		2,651,114		3,406,756
Telecom Italia S.p.A. - RSP		1,578,060		1,568,550
				4,975,306
Transportation 0.1%
Atlantia S.p.A.		17,939		467,292
Utilities 0.8%
A2A S.p.A.		178,901		218,921
Enel S.p.A.		1,040,084		5,890,963
Snam S.p.A.		72,970		438,910
Terna - Rete Elettrica Nationale S.p.A.		53,008		287,181
				6,835,975
				41,643,805
Japan 17.3%
Automobiles & Components 2.1%
Aisin Seiki Co., Ltd.		18,000		636,109
Bridgestone Corp.		39,300		1,407,156
Daihatsu Motor Co., Ltd.		15,100		250,115
Denso Corp.		24,900		1,134,264
Fuji Heavy Industries Ltd.		16,500		433,862
Honda Motor Co., Ltd.		103,600		3,437,931
Isuzu Motors Ltd.		56,000		325,223
Mazda Motor Corp.		121,000		541,020
NHK Spring Co., Ltd.		17,000		153,882
Nissan Motors Co., Ltd.		211,000		1,820,634
Stanley Electric Co., Ltd.		9,300		206,125
Suzuki Motor Corp.		31,000		799,802
Toyota Industries Corp.		10,300		474,809
Toyota Motor Corp.		112,500		6,078,167
Yamaha Motor Co., Ltd.		22,500		347,328
				18,046,427
Banks 0.8%
Mitsubishi UFJ Financial Group, Inc.		489,734		2,605,137
Mizuho Financial Group, Inc.		800,416		1,567,700
Resona Holdings, Inc.		82,358		421,097
Sumitomo Mitsui Financial Group, Inc.		51,910		2,052,018
Sumitomo Mitsui Trust Holdings, Inc.		59,000		243,121
The Bank of Yokohama Ltd.		44,000		221,148
				7,110,221
Capital Goods 2.6%
Asahi Glass Co., Ltd.		134,000		759,697
Daikin Industries Ltd.		10,100		584,226
Fanuc Corp.		4,300		775,874
Fujikura Ltd.		47,000		202,381
Furukawa Electric Co., Ltd.		110,000		247,661
Hanwa Co., Ltd.		49,000		191,651
IHI Corp.		63,000		251,196
ITOCHU Corp.		90,500		1,014,486
JGC Corp.		8,000		259,051
JTEKT Corp.		17,900		261,170
Kajima Corp.		70,000		266,525
Kawasaki Heavy Industries Ltd.		79,000		293,213
Komatsu Ltd.		50,800		1,118,427
Kubota Corp.		34,000		438,210
LIXIL Group Corp.		17,100		453,149
Makita Corp.		5,600		297,855
Marubeni Corp.		118,000		788,525
Mitsubishi Corp.		118,600		2,123,806
Mitsubishi Electric Corp.		119,000		1,355,033
Mitsubishi Heavy Industries Ltd.		173,000		910,835
Mitsui & Co., Ltd.		139,900		1,984,114
Mitsui Engineering & Shipbuilding Co., Ltd.		88,000		170,740
Nagase & Co., Ltd.		14,200		173,994
Nidec Corp.		7,800		440,977
Nippon Sheet Glass Co., Ltd. *		185,000		237,288
NSK Ltd.		25,000		262,818
Obayashi Corp.		41,000		264,733
Shimizu Corp.		63,000		357,124
SMC Corp.		1,600		380,889

See financial notes 23

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Sojitz Corp.		362,700		571,912
Sumitomo Corp.		94,200		1,222,762
Sumitomo Electric Industries Ltd.		72,500		1,003,485
Sumitomo Heavy Industries Ltd.		67,000		285,078
Taisei Corp.		72,000		333,789
Toshiba Corp.		324,000		1,269,063
Toyota Tsusho Corp.		28,700		755,935
				22,307,672
Commercial & Professional Supplies 0.2%
Dai Nippon Printing Co., Ltd.		84,000		756,618
Secom Co., Ltd.		10,200		585,614
Toppan Printing Co., Ltd.		77,000		528,824
				1,871,056
Consumer Durables & Apparel 0.8%
Namco Bandai Holdings, Inc.		14,900		321,916
Nikon Corp.		20,500		321,409
Panasonic Corp.		245,750		2,678,689
Sega Sammy Holdings, Inc.		8,500		171,336
Sekisui Chemical Co., Ltd.		34,000		344,563
Sekisui House Ltd.		43,900		526,958
Sharp Corp. *(c)		246,000		616,665
Shimano, Inc.		2,200		219,916
Sony Corp.		95,800		1,681,825
Yamaha Corp.		14,300		191,601
				7,074,878
Consumer Services 0.1%
Benesse Holdings, Inc.		6,000		228,289
Oriental Land Co., Ltd.		1,400		209,739
				438,028
Diversified Financials 0.1%
Credit Saison Co., Ltd.		8,300		176,817
Nomura Holdings, Inc.		37,100		214,841
ORIX Corp.		36,100		523,083
				914,741
Energy 0.7%
Cosmo Oil Co., Ltd.		187,000		349,825
Idemitsu Kosan Co., Ltd.		30,700		678,885
Inpex Corp.		84,300		1,229,381
JX Holdings, Inc.		546,300		2,838,465
Showa Shell Sekiyu K.K.		26,900		272,885
TonenGeneral Sekiyu K.K.		45,000		425,062
				5,794,503
Food & Staples Retailing 0.5%
Aeon Co., Ltd.		96,700		1,116,848
Lawson, Inc.		3,100		215,300
Seven & i Holdings Co., Ltd.		62,100		2,450,233
Uny Group Holdings Co., Ltd.		38,800		250,398
				4,032,779
Food, Beverage & Tobacco 0.6%
Ajinomoto Co., Inc.		40,000		588,713
Asahi Group Holdings Ltd.		22,500		621,737
Coca-Cola West Co., Ltd.		8,900		154,897
Japan Tobacco, Inc.		35,100		1,153,686
Kirin Holdings Co., Ltd.		65,000		900,251
MEIJI Holdings Co., Ltd.		6,800		417,294
Nippon Meat Packers, Inc.		20,000		346,628
Nisshin Seifun Group, Inc.		17,100		198,951
Toyo Suisan Kaisha Ltd.		6,000		192,188
Yamazaki Baking Co., Ltd.		19,000		232,148
				4,806,493
Health Care Equipment & Services 0.2%
Alfresa Holdings Corp.		6,300		392,218
Medipal Holdings Corp.		27,500		386,800
Olympus Corp. *		6,900		210,757
Suzuken Co., Ltd.		9,500		342,429
Terumo Corp.		10,000		198,456
				1,530,660
Household & Personal Products 0.2%
Kao Corp.		30,000		1,129,422
Shiseido Co., Ltd.		24,600		439,501
				1,568,923
Insurance 0.3%
MS&AD Insurance Group Holdings		16,290		365,420
NKSJ Holdings, Inc.		17,600		439,099
T&D Holdings, Inc.		18,450		220,225
The Dai-ichi Life Insurance Co., Ltd.		28,600		396,303
Tokio Marine Holdings, Inc.		25,200		742,541
				2,163,588
Materials 1.4%
Asahi Kasei Corp.		104,000		707,075
Denki Kagaku Kogyo K.K.		51,000		169,143
DIC Corp.		85,000		225,575
JFE Holdings, Inc.		69,600		1,286,295
JSR Corp.		14,000		229,416
Kaneka Corp.		36,000		211,151
Kobe Steel Ltd.		370,000		485,684
Kuraray Co., Ltd.		24,500		275,472
Mitsubishi Chemical Holdings Corp.		161,400		645,927
Mitsubishi Materials Corp.		96,000		278,451
Mitsui Chemicals, Inc.		165,000		402,068
Mitsui Mining & Smelting Co., Ltd.		65,000		161,177
Nippon Steel & Sumitomo Metal Corp.		593,000		1,555,817
Nitto Denko Corp.		9,000		389,665
Oji Holdings Corp.		99,000		415,948
Shin-Etsu Chemical Co., Ltd.		20,000		1,173,241
Showa Denko K.K.		207,000		275,818
Sumitomo Chemical Co., Ltd.		163,000		611,518
Sumitomo Metal Mining Co., Ltd.		41,000		619,285
Taiheiyo Cement Corp.		58,000		203,458
Teijin Ltd.		167,000		410,495
Toray Industries, Inc.		92,000		600,463
Tosoh Corp.		52,000		198,427
Toyo Seikan Group Holdings Ltd.		19,300		287,027
Ube Industries Ltd.		134,000		227,025
				12,045,621
Media 0.1%
Dentsu, Inc.		16,001		656,244
Hakuhodo DY Holdings, Inc.		41,400		321,146
				977,390
Pharmaceuticals, Biotechnology & Life Sciences 0.7%
Astellas Pharma, Inc.		97,500		1,087,075
Daiichi Sankyo Co., Ltd.		44,200		741,424

24 See financial notes

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Eisai Co., Ltd.		14,300		552,253
Ono Pharmaceutical Co., Ltd.		3,000		237,941
Otsuka Holdings Co., Ltd.		22,900		659,698
Shionogi & Co., Ltd.		13,000		227,869
Taisho Pharmaceutical Holdings Co., Ltd.		3,300		243,235
Takeda Pharmaceutical Co., Ltd.		42,800		1,925,149
				5,674,644
Real Estate 0.3%
Daito Trust Construction Co., Ltd.		4,500		457,924
Daiwa House Industry Co., Ltd.		27,000		456,184
Mitsubishi Estate Co., Ltd.		21,000		476,499
Mitsui Fudosan Co., Ltd.		21,000		621,636
Sumitomo Realty & Development Co., Ltd.		7,500		290,995
				2,303,238
Retailing 0.3%
Edion Corp.		47,500		276,803
Fast Retailing Co., Ltd.		800		248,591
Isetan Mitsukoshi Holdings Ltd.		27,400		340,967
J. Front Retailing Co., Ltd.		42,000		266,975
K’s Holdings Corp.		8,200		237,967
Shimamura Co., Ltd.		2,700		251,527
Takashimaya Co., Ltd.		28,000		265,278
Yamada Denki Co., Ltd.		258,600		955,390
				2,843,498
Semiconductors & Semiconductor Equipment 0.1%
Rohm Co., Ltd.		9,500		454,308
Tokyo Electron Ltd.		10,300		585,821
				1,040,129
Software & Services 0.5%
Fujitsu Ltd.		339,000		1,993,397
Konami Corp.		7,700		175,595
Nintendo Co., Ltd.		13,630		1,430,610
NTT Data Corp.		11,700		452,036
				4,051,638
Technology Hardware & Equipment 1.8%
Brother Industries Ltd.		22,200		310,522
Canon, Inc.		105,300		3,299,570
FUJIFILM Holdings Corp.		57,200		1,477,595
Hitachi Ltd.		400,000		2,851,575
Hoya Corp.		25,300		748,306
Ibiden Co., Ltd.		13,300		240,067
Keyence Corp.		573		221,041
Konica Minolta, Inc.		59,400		553,497
Kyocera Corp.		20,100		945,301
Murata Manufacturing Co., Ltd.		6,900		575,210
NEC Corp.		435,000		1,223,653
Nippon Electric Glass Co., Ltd.		71,000		347,326
Omron Corp.		9,700		343,519
Ricoh Co., Ltd.		68,000		783,569
Seiko Epson Corp.		19,400		529,426
TDK Corp.		12,700		541,547
				14,991,724
Telecommunication Services 1.1%
KDDI Corp.		40,900		2,181,265
Nippon Telegraph & Telephone Corp.		64,904		3,601,701
NTT DOCOMO, Inc.		126,300		2,014,553
SoftBank Corp.		22,000		1,638,516
				9,436,035
Transportation 0.9%
ANA Holdings, Inc. (c)		89,000		194,354
Central Japan Railway Co.		9,000		1,105,432
East Japan Railway Co.		20,718		1,511,694
Hankyu Hanshin Holdings, Inc.		60,000		328,834
Kawasaki Kisen Kaisha Ltd.		134,000		269,065
Kintetsu Corp.		59,000		207,342
Mitsui O.S.K. Lines Ltd.		178,000		593,820
Nagoya Railroad Co., Ltd.		63,000		199,893
Nippon Express Co., Ltd.		117,000		553,096
Nippon Yusen K.K.		251,000		680,341
Seino Holdings Co., Ltd.		25,000		247,093
Tobu Railway Co., Ltd.		44,000		215,203
Tokyu Corp.		53,000		333,806
West Japan Railway Co.		15,863		643,291
Yamato Holdings Co., Ltd.		29,500		607,056
				7,690,320
Utilities 0.9%
Chubu Electric Power Co., Inc. *		97,900		1,115,137
Electric Power Development Co., Ltd.		9,400		249,271
Hokkaido Electric Power Co., Inc. *		24,500		149,878
Hokuriku Electric Power Co.		23,700		294,325
Kyushu Electric Power Co., Inc. *		53,300		537,774
Osaka Gas Co., Ltd.		157,000		591,780
Shikoku Electric Power Co., Inc. *		19,300		225,908
The Chugoku Electric Power Co., Inc.		30,100		394,398
The Kansai Electric Power Co., Inc. *		106,100		889,664
Toho Gas Co., Ltd.		36,000		176,636
Tohoku Electric Power Co., Inc.		60,900		579,571
Tokyo Electric Power Co., Inc. *		397,200		1,502,309
Tokyo Gas Co., Ltd.		180,000		943,094
				7,649,745
				146,363,951
Luxembourg 0.6%
Energy 0.1%
Tenaris S.A.		20,618		455,778
Materials 0.4%
APERAM *		13,638		354,841
ArcelorMittal		227,568		3,700,537
				4,055,378
Media 0.1%
SES S.A.		12,838		483,474
Telecommunication Services 0.0%
Millicom International Cellular S.A. SDR		3,623		359,093
				5,353,723
Netherlands 6.0%
Capital Goods 0.3%
Koninklijke BAM Groep N.V.		40,421		219,172

See financial notes 25

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Koninklijke Philips N.V.		61,456		1,967,400
Royal Imtech N.V. *(c)		52,275		101,917
				2,288,489
Commercial & Professional Supplies 0.1%
Randstad Holding N.V.		8,460		494,399
Diversified Financials 0.4%
ING Groep N.V. CVA *		209,587		2,996,016
SNS Reaal N.V. *(a)(b)(c)		124,822		—
				2,996,016
Energy 3.5%
Fugro N.V. CVA		5,337		353,654
Royal Dutch Shell plc, A Shares		437,864		17,320,923
Royal Dutch Shell plc, B Shares		292,122		12,403,789
				30,078,366
Food & Staples Retailing 0.3%
Koninklijke Ahold N.V.		121,113		2,341,344
Food, Beverage & Tobacco 0.5%
Corbion N.V.		8,359		193,867
Heineken Holding N.V.		6,322		404,049
Heineken N.V.		8,947		621,436
Nutreco N.V.		4,962		230,997
Unilever N.V. CVA		63,748		2,733,585
				4,183,934
Insurance 0.2%
Aegon N.V.		125,115		1,146,855
Delta Lloyd N.V.		17,142		451,143
				1,597,998
Materials 0.3%
Akzo Nobel N.V.		22,674		1,747,305
Koninklijke DSM N.V.		11,726		842,018
				2,589,323
Media 0.1%
Reed Elsevier N.V.		13,443		274,383
Wolters Kluwer N.V.		14,373		400,660
				675,043
Semiconductors & Semiconductor Equipment 0.0%
ASML Holding N.V.		3,543		289,159
Software & Services 0.0%
Gemalto N.V.		1,985		221,934
Telecommunication Services 0.2%
Koninklijke (Royal) KPN N.V. *		544,422		1,934,259
Transportation 0.1%
PostNL N.V. *		172,237		757,036
TNT Express N.V.		38,348		345,575
				1,102,611
				50,792,875
New Zealand 0.1%
Materials 0.0%
Fletcher Building Ltd.		44,873		381,570
Telecommunication Services 0.1%
Telecom Corp. of New Zealand Ltd.		245,737		587,056
				968,626
Norway 1.0%
Banks 0.1%
DNB A.S.A.		37,171		658,875
Energy 0.6%
Aker Solutions A.S.A.		11,922		191,020
Petroleum Geo-Services A.S.A.		17,111		206,593
Statoil A.S.A. (c)		135,531		4,131,716
				4,529,329
Food, Beverage & Tobacco 0.1%
Marine Harvest A.S.A.		20,750		254,499
Orkla A.S.A.		68,984		570,538
				825,037
Materials 0.1%
Norsk Hydro A.S.A.		98,920		530,527
Yara International A.S.A.		12,728		601,671
				1,132,198
Telecommunication Services 0.1%
Telenor A.S.A.		41,081		965,281
				8,110,720
Portugal 0.3%
Banks 0.1%
Banco Comercial Portugues S.A. - Reg’d *		1,577,988		479,542
Banco Espirito Santo, S.A. - Reg’d *		136,913		242,683
				722,225
Energy 0.0%
Galp Energia, SGPS, S.A.		15,405		267,000
Telecommunication Services 0.1%
Portugal Telecom, SGPS, S.A. - Reg’d (c)		172,754		717,736
Utilities 0.1%
EDP - Energias de Portugal S.A.		228,227		1,108,649
				2,815,610
Singapore 0.7%
Banks 0.2%
DBS Group Holdings Ltd.		50,056		678,117
Oversea-Chinese Banking Corp., Ltd.		66,897		515,921
United Overseas Bank Ltd.		36,952		643,154
				1,837,192
Capital Goods 0.1%
Keppel Corp., Ltd.		55,300		465,296
Sembcorp Industries Ltd.		54,000		231,829
				697,125
Food, Beverage & Tobacco 0.1%
Wilmar International Ltd.		131,166		356,485
Media 0.0%
Singapore Press Holdings Ltd. (c)		70,000		234,079

26 See financial notes

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Retailing 0.0%
Jardine Cycle & Carriage Ltd.		6,000		224,976
Technology Hardware & Equipment 0.1%
Flextronics International Ltd. *		72,615		652,809
Venture Corp., Ltd.		36,000		220,505
				873,314
Telecommunication Services 0.1%
Singapore Telecommunications Ltd.		311,486		954,118
Transportation 0.1%
ComfortDelGro Corp., Ltd.		129,000		218,761
Singapore Airlines Ltd.		55,270		458,212
				676,973
				5,854,262
Spain 4.6%
Banks 2.2%
Banco Bilbao Vizcaya Argentaria S.A.		392,327		4,832,580
Banco de Sabadell S.A.		186,883		635,829
Banco Popular Espanol S.A.		117,751		867,698
Banco Santander S.A. (c)		1,148,681		11,424,399
Bankia S.A. *		213,971		437,061
				18,197,567
Capital Goods 0.2%
ACS, Actividades de Construccion y Servicios S.A.		19,105		820,070
Ferrovial S.A.		20,766		461,593
Fomento de Construcciones y Contratas S.A. *		14,713		324,553
				1,606,216
Energy 0.4%
Repsol S.A.		122,406		3,295,715
Food & Staples Retailing 0.0%
Distribuidora Internacional de Alimentacion S.A.		25,918		231,849
Retailing 0.1%
Inditex S.A.		4,712		707,964
Software & Services 0.0%
Amadeus IT Holding S.A., A Shares		8,031		334,013
Telecommunication Services 1.1%
Telefonica S.A.		575,622		9,660,152
Transportation 0.0%
Abertis Infraestructuras S.A.		17,037		383,495
Utilities 0.6%
Acciona S.A.		4,612		375,167
Enagas S.A.		8,058		248,257
Endesa S.A.		12,040		456,558
Gas Natural SDG S.A.		23,351		669,591
Iberdrola S.A.		403,644		2,819,669
Red Electrica Corp. S.A.		4,142		340,953
				4,910,195
				39,327,166
Sweden 2.3%
Automobiles & Components 0.1%
Autoliv, Inc.		4,972		507,045
Banks 0.4%
Nordea Bank AB		89,354		1,294,793
Skandinaviska Enskilda Banken AB, A Shares		56,040		774,076
Svenska Handelsbanken AB, A Shares		18,750		943,124
Swedbank AB, A Shares		22,612		605,140
				3,617,133
Capital Goods 0.8%
Alfa Laval AB (c)		11,196		298,299
Assa Abloy AB, B Shares		8,506		451,452
Atlas Copco AB, A Shares (c)		24,773		720,468
Atlas Copco AB, B Shares		11,539		314,730
NCC AB, B Shares		7,554		264,658
Sandvik AB		66,778		949,044
Scania AB, B Shares		15,635		476,341
Skanska AB, B Shares		32,958		756,692
SKF AB, B Shares		21,593		560,729
Trelleborg AB, B Shares		10,751		230,034
Volvo AB, A Shares		16,418		264,331
Volvo AB, B Shares		84,396		1,336,338
				6,623,116
Commercial & Professional Supplies 0.1%
Securitas AB, B Shares		32,271		390,113
Consumer Durables & Apparel 0.1%
Electrolux AB, B Shares		21,350		593,440
Husqvarna AB, B Shares		41,470		346,257
				939,697
Food, Beverage & Tobacco 0.0%
Swedish Match AB		9,322		319,808
Health Care Equipment & Services 0.0%
Getinge AB, B Shares		6,970		204,282
Household & Personal Products 0.1%
Svenska Cellulosa AB, S.C.A., B Shares		34,404		967,201
Materials 0.1%
Boliden AB		27,486		419,774
SSAB AB, A Shares *		41,133		359,124
SSAB AB, B Shares *(c)		12,558		95,006
				873,904
Retailing 0.2%
Hennes & Mauritz AB, B Shares (c)		30,670		1,255,412
Technology Hardware & Equipment 0.2%
Telefonaktiebolaget LM Ericsson, B Shares		157,465		1,898,785
Telecommunication Services 0.2%
Tele2 AB, B Shares		52,005		664,577
TeliaSonera AB		154,220		1,122,576
				1,787,153
				19,383,649

See financial notes 27

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Switzerland 5.7%
Capital Goods 0.5%
Wolseley plc		19,309		1,118,847
ABB Ltd. - Reg’d *		99,857		2,404,165
Geberit AG - Reg’d		936		312,615
Schindler Holding AG		1,428		221,240
Schindler Holding AG - Reg’d		386		58,919
				4,115,786
Commercial & Professional Supplies 0.3%
Adecco S.A. - Reg’d *		11,681		980,644
SGS S.A. - Reg’d		150		374,715
Tyco International Ltd.		36,707		1,501,316
				2,856,675
Consumer Durables & Apparel 0.2%
Cie Financiere Richemont S.A.		9,289		945,063
The Swatch Group AG - Bearer Shares		612		393,540
The Swatch Group AG - Reg’d		1,077		129,951
				1,468,554
Diversified Financials 0.3%
Credit Suisse Group AG - Reg’d *		51,902		1,645,430
GAM Holding AG *		10,327		188,087
UBS AG - Reg’d *		10,381		217,107
				2,050,624
Energy 0.3%
Noble Corp., plc		13,166		405,645
Transocean Ltd.		24,679		1,054,259
Weatherford International Ltd. *		41,093		862,953
				2,322,857
Food, Beverage & Tobacco 1.2%
Aryzta AG *		2,627		242,828
Lindt & Spruengli AG		18		87,536
Lindt & Spruengli AG - Reg’d		2		116,646
Nestle S.A. - Reg’d		124,406		9,614,626
				10,061,636
Insurance 0.6%
Baloise Holding AG - Reg’d		2,130		259,378
Swiss Life Holding AG - Reg’d *		1,473		362,911
Swiss Re AG *		14,621		1,278,476
Zurich Insurance Group AG *		9,459		2,712,450
				4,613,215
Materials 0.6%
Clariant AG - Reg’d *		14,239		280,792
Givaudan S.A. - Reg’d *		205		323,526
Glencore Xstrata plc		394,231		2,127,177
Holcim Ltd. - Reg’d *		14,877		1,364,465
Sika AG		73		295,372
Syngenta AG - Reg’d		2,622		1,038,290
				5,429,622
Media 0.0%
Informa plc		28,060		229,147
Pharmaceuticals, Biotechnology & Life Sciences 1.4%
Lonza Group AG - Reg’d *		2,426		253,906
Novartis AG - Reg’d		78,095		6,788,993
Roche Holding AG		17,003		4,987,764
Roche Holding AG - Bearer Shares		577		168,437
				12,199,100
Semiconductors & Semiconductor Equipment 0.1%
STMicroelectronics N.V.		60,521		577,611
Technology Hardware & Equipment 0.1%
TE Connectivity Ltd.		18,455		1,088,476
Telecommunication Services 0.1%
Swisscom AG - Reg’d		1,203		731,880
Transportation 0.0%
Kuehne & Nagel International AG - Reg’d		2,565		350,740
				48,095,923
United Kingdom 16.9%
Automobiles & Components 0.0%
GKN plc		60,718		394,728
Banks 2.2%
Barclays plc		971,217		4,147,138
HSBC Holdings plc		1,022,495		10,447,456
Lloyds Banking Group plc *		1,556,335		1,984,658
Royal Bank of Scotland Group plc *		139,738		707,975
Standard Chartered plc		75,589		1,637,049
				18,924,276
Capital Goods 0.7%
BAE Systems plc		227,365		1,538,231
Balfour Beatty plc		82,365		391,157
Bunzl plc		13,851		394,639
Carillion plc		41,935		262,320
Cobham plc		49,492		258,193
Foster Wheeler AG *		10,108		346,502
IMI plc		10,963		278,050
Meggitt plc		28,238		227,771
Rolls-Royce Holdings plc *		57,684		1,024,611
SIG plc		61,602		199,646
Smiths Group plc		17,665		398,764
The Weir Group plc		4,851		220,658
Travis Perkins plc		12,249		353,633
Vesuvius plc		29,568		208,560
				6,102,735
Commercial & Professional Supplies 0.2%
Aggreko plc		8,021		214,075
Capita plc		16,393		300,605
G4S plc		106,808		426,428
Hays plc		120,952		308,573
Serco Group plc		29,003		166,542
				1,416,223
Consumer Durables & Apparel 0.1%
Barratt Developments plc		51,343		321,107
Burberry Group plc		11,195		281,154
Persimmon plc *		13,464		298,793
Taylor Wimpey plc		148,770		264,579
				1,165,633
Consumer Services 0.4%
Carnival plc		14,043		561,422
Compass Group plc		82,617		1,316,002

28 See financial notes

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
InterContinental Hotels Group plc		7,461		254,991
Ladbrokes plc		53,998		140,026
Thomas Cook Group plc *		158,689		469,100
TUI Travel plc		57,396		415,159
Whitbread plc		5,922		408,476
William Hill plc		29,384		176,070
				3,741,246
Diversified Financials 0.1%
ICAP plc		29,096		203,814
Man Group plc		369,700		616,974
				820,788
Energy 2.9%
AMEC plc		18,466		385,666
BG Group plc		141,910		2,870,741
BP plc		2,421,967		20,448,938
Ensco plc, Class A		5,764		290,794
John Wood Group plc		19,764		262,065
Tullow Oil plc		14,890		221,493
				24,479,697
Food & Staples Retailing 0.8%
J. Sainsbury plc		204,867		1,162,170
Tesco plc		812,058		4,022,874
WM Morrison Supermarkets plc		380,946		1,293,185
				6,478,229
Food, Beverage & Tobacco 1.5%
Associated British Foods plc		14,006		703,248
British American Tobacco plc		72,547		4,189,221
Diageo plc		61,900		1,896,603
Imperial Tobacco Group plc		45,306		1,957,870
SABMiller plc		21,969		1,196,233
Tate & Lyle plc		27,565		326,773
Unilever plc		46,160		2,064,878
				12,334,826
Health Care Equipment & Services 0.1%
Smith & Nephew plc		35,539		554,165
Household & Personal Products 0.2%
Reckitt Benckiser Group plc		17,847		1,440,716
Insurance 0.8%
Amlin plc		27,875		210,754
Aviva plc		230,982		2,058,463
Legal & General Group plc		145,774		521,833
Old Mutual plc		229,747		776,564
Prudential plc		48,895		1,124,052
Resolution Ltd.		100,046		504,717
RSA Insurance Group plc		319,956		530,220
Standard Life plc		72,619		469,481
Willis Group Holdings plc		6,090		249,629
				6,445,713
Materials 1.6%
Anglo American plc		168,882		4,514,739
Antofagasta plc		19,262		256,709
BHP Billiton plc		97,418		3,162,614
Johnson Matthey plc		14,388		795,943
Kazakhmys plc *		50,617		203,484
Mondi plc		24,737		411,226
Rexam plc		57,476		481,874
Rio Tinto plc		69,892		3,799,866
Vedanta Resources plc		14,699		235,378
				13,861,833
Media 0.3%
British Sky Broadcasting Group plc		33,638		499,791
ITV plc		73,591		226,373
Pearson plc		43,496		815,635
Reed Elsevier plc		22,759		335,641
WPP plc		40,864		881,093
				2,758,533
Pharmaceuticals, Biotechnology & Life Sciences 1.9%
AstraZeneca plc		103,317		8,155,285
GlaxoSmithKline plc		279,216		7,714,887
				15,870,172
Real Estate 0.1%
British Land Co., plc		22,299		260,518
Land Securities Group plc		22,765		408,954
				669,472
Retailing 0.5%
Dixons Retail plc *		330,574		251,427
Home Retail Group plc		244,300		844,132
Inchcape plc		41,655		452,507
Kingfisher plc		172,944		1,223,817
Marks & Spencer Group plc		144,783		1,082,443
Next plc		6,521		719,409
				4,573,735
Software & Services 0.0%
The Sage Group plc		46,180		333,118
Telecommunication Services 1.4%
BT Group plc		481,143		3,003,604
Cable & Wireless Communications plc		458,501		409,452
Inmarsat plc		18,948		233,144
Vodafone Group plc		2,087,463		7,925,277
				11,571,477
Transportation 0.1%
FirstGroup plc *		197,424		431,405
International Consolidated Airlines Group S.A. *		41,070		280,879
National Express Group plc		45,452		214,416
				926,700
Utilities 1.0%
Centrica plc		352,791		1,967,529
Drax Group plc		28,192		315,581
National Grid plc		194,309		2,761,762
Pennon Group plc		18,345		234,846
Severn Trent plc		12,485		388,920
SSE plc		72,079		1,858,665
United Utilities Group plc		48,487		652,199
				8,179,502
				143,043,517
Total Common Stock
(Cost $654,983,799)				826,627,338

See financial notes 29

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Preferred Stock 0.4% of net assets
Germany 0.4%
Automobiles & Components 0.3%
Bayerische Motoren Werke AG		3,039		299,570
Volkswagen AG		9,101		2,460,228
				2,759,798
Household & Personal Products 0.1%
Henkel AG & Co. KGaA		5,594		624,012
Utilities 0.0%
RWE AG		7,498		216,336
				3,600,146
United Kingdom 0.0%
Capital Goods 0.0%
Rolls-Royce Holdings plc *(a)(b)		7,387,688		12,473
Total Preferred Stock
(Cost $2,226,152)				3,612,619
Rights 0.0% of net assets
Spain 0.0%
Banks 0.0%
Banco Santander S.A. *(a)(b)(c)		1,102,827		233,309
Total Rights
(Cost $228,127)				233,309
Warrants 0.0% of net assets
France 0.0%
Automobiles & Components 0.0%
Peugeot S.A. *(c)		105,959		202,716
Hong Kong 0.0%
Real Estate 0.0%
Sun Hung Kai Properties Ltd. *(b)		1,083		729
Total Warrants
(Cost $140,410)				203,445
Other Investment Company 0.0% of net assets
United States 0.0%
iShares MSCI EAFE ETF		100		6,832
Total Other Investment Company
(Cost $4,656)				6,832
Security	Face Amount		Value
Rate, Maturity Date	Local Currency		($)
Short-Term Investments 1.5% of net assets
Time Deposits 1.2%
Bank of Tokyo Mitsubishi
US Dollar
0.03%, 05/01/14		9,796,278		9,796,278
Brown Brothers Harriman
Hong Kong Dollar
0.01%, 05/01/14		5,449		703
Japanese Yen
0.01%, 05/01/14		1,036,534		10,139
Pound Sterling
0.07%, 05/01/14		336		567
Swiss Franc
0.00%, 05/01/14		31,463		35,750
Wells Fargo
Canadian Dollar
0.24%, 05/01/14		103,919		94,812
Euro
0.05%, 05/01/14		128,152		177,791
				10,116,040
U.S. Treasury Obligation 0.3%
U.S. Treasury Bill
0.05%, 06/19/14 (d)(e)		2,000,000		1,999,864
Total Short-Term Investments
(Cost $12,115,904)				12,115,904
End of Investments.
	Number		Value
Security	of Shares		($)
Collateral Invested for Securities on Loan 3.0% of net assets
Wells Fargo Advantage Government Money Market Fund, Institutional Class 0.01% (f)		25,081,669		25,081,669
Total Collateral Invested for Securities on Loan
(Cost $25,081,669)				25,081,669
End of Collateral Invested for Securities on Loan.

30 See financial notes

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings (Unaudited) continued

At 04/30/14, the tax basis cost of the fund’s investments was $686,731,653 unrealized appreciation and depreciation were $167,048,529 and ($10,980,735), respectively, with a net unrealized appreciation of $156,067,794.

At 04/30/14, the values of certain foreign securities held by the fund aggregating $765,673,707 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(a) for additional information)

*	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 $246,511 or 0.0% of net assets.
(c)	All or a portion of this security is on loan. Securities on loan were valued at $20,332,688.
(d)	The rate shown is the purchase yield.
(e)	All or a portion of this security is held as collateral for open futures contracts.
(f)	The rate shown is the 7-day yield.

CVA —	Dutch Certificate
ETF —	Exchange traded fund
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 04/30/14:

			Contract		Unrealized
	Number of		Value		Appreciation
	Contracts		($)		($)
Futures Contracts
MSCI EAFE, e-mini, Long, expires 06/20/14		115		11,064,725		424,212

See financial notes 31

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings as of April 30, 2014 (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		150,662,376		182,654,382
	0	.5%	Preferred Stock		597,623		947,632
	0	.0%	Rights		27,110		53,682
	1	.8%	Other Investment Company		3,251,972		3,381,300
	0	.7%	Short-Term Investments		1,236,416		1,236,416
	100	.0%	Total Investments		155,775,497		188,273,412
	2	.6%	Collateral Invested for Securities on Loan		4,909,704		4,909,704
	(2	.6)%	Other Assets and Liabilities, Net				(4,969,219	)
	100	.0%	Net Assets				188,213,897

	Number		Value
Security	of Shares		($)
Common Stock 97.0% of net assets
Australia 5.4%
Banks 0.2%
Bank of Queensland Ltd.		16,304		186,396
Bendigo & Adelaide Bank Ltd.		22,579		241,993
				428,389
Capital Goods 0.3%
Ausdrill Ltd.		67,032		58,156
Boart Longyear Ltd. *(a)		578,380		153,848
Bradken Ltd.		23,791		93,893
Cardno Ltd.		10,457		68,102
GWA Group Ltd.		37,743		94,698
Monadelphous Group Ltd. (a)		7,559		123,244
				591,941
Commercial & Professional Supplies 0.4%
ALS Ltd.		22,716		158,876
Programmed Maintenance Services Ltd.		32,257		85,412
Seek Ltd.		5,966		93,438
Skilled Group Ltd.		33,887		86,664
Transfield Services Ltd. *		199,691		178,818
Transpacific Industries Group Ltd. *		132,148		137,422
				740,630
Consumer Durables & Apparel 0.0%
G.U.D. Holdings Ltd.		13,153		65,507
Consumer Services 0.2%
Aristocrat Leisure Ltd.		23,191		108,803
Echo Entertainment Group Ltd.		55,357		145,599
Flight Centre Travel Group Ltd.		1,915		96,045
				350,447
Diversified Financials 0.3%
ASX Ltd.		6,443		213,212
Challenger Ltd.		23,172		152,455
IOOF Holdings Ltd.		9,223		72,922
Perpetual Ltd.		2,958		129,491
				568,080
Energy 0.1%
AWE Ltd. *		77,092		112,620
Beach Energy Ltd.		78,230		125,196
				237,816
Food, Beverage & Tobacco 0.3%
Goodman Fielder Ltd.		418,404		262,371
GrainCorp Ltd., Class A		13,328		109,922
Treasury Wine Estates Ltd.		55,721		198,441
				570,734
Health Care Equipment & Services 0.5%
Ansell Ltd.		9,301		156,639
Cochlear Ltd.		2,544		139,063
Primary Health Care Ltd.		35,937		157,071
Ramsay Health Care Ltd.		4,015		167,762
Sigma Pharmaceuticals Ltd.		420,324		283,668
				904,203
Insurance 0.1%
NIB Holdings Ltd.		42,031		107,601
Materials 0.6%
Adelaide Brighton Ltd.		39,318		143,315
Aquarius Platinum Ltd. *(a)		239,884		85,798
DuluxGroup Ltd.		11,731		62,658
Fortescue Metals Group Ltd.		36,831		174,208
Gunns Ltd. *(b)(c)		124,356		—
Iluka Resources Ltd.		23,747		197,285
Kagara Ltd. *(b)(c)		83,968		—
Mount Gibson Iron Ltd.		76,922		52,532
Nufarm Ltd.		32,038		123,939
OZ Minerals Ltd.		71,514		246,119
				1,085,854
Media 0.1%
Seven West Media Ltd.		48,885		84,940
Southern Cross Media Group Ltd.		43,533		52,132
Ten Network Holdings Ltd. *		345,487		87,026
				224,098
Real Estate 0.7%
Australand Property Group		20,246		80,689
CFS Retail Property Trust Group		102,614		192,115
Charter Hall Retail REIT		14,766		53,080
Dexus Property Group		319,112		337,597
Goodman Group		48,845		226,882
GPT Group		72,023		262,836
Investa Office Fund		27,030		84,152
Westfield Retail Trust		58,404		173,517
				1,410,868

32 See financial notes

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Retailing 0.7%
Automotive Holdings Group Ltd.		30,654		114,275
David Jones Ltd.		103,629		379,629
Harvey Norman Holdings Ltd.		52,600		160,979
JB Hi-Fi Ltd. (a)		9,731		174,866
Myer Holdings Ltd		100,271		207,726
Pacific Brands Ltd.		322,118		151,662
Premier Investments Ltd.		13,828		127,717
				1,316,854
Software & Services 0.2%
Computershare Ltd.		28,004		322,794
Transportation 0.3%
Aurizon Holdings Ltd.		68,185		329,212
Transurban Group (b)		37,340		252,188
Virgin Australia International Holdings (b)(c)		176,214		—
				581,400
Utilities 0.4%
APA Group		39,816		246,793
DUET Group		120,735		243,802
SP AusNet		128,616		167,606
				658,201
				10,165,417
Austria 0.7%
Banks 0.2%
Raiffeisen Bank International AG		8,383		264,991
Capital Goods 0.1%
Zumtobel AG		5,310		110,408
Energy 0.0%
Schoeller-Bleckmann Oilfield Equipment AG		545		69,280
Insurance 0.1%
Vienna Insurance Group AG Wiener Versicherung Gruppe		3,364		179,914
Materials 0.1%
Lenzing AG		1,075		68,604
RHI AG		2,243		78,514
				147,118
Real Estate 0.1%
IMMOFINANZ AG *		57,880		214,561
Transportation 0.1%
Oesterreichische Post AG		4,397		224,719
Utilities 0.0%
Verbund AG		3,595		69,701
				1,280,692
Belgium 1.3%
Capital Goods 0.1%
Cie d’Entreprises CFE		1,054		116,133
Diversified Financials 0.3%
Ackermans & van Haaren N.V.		804		103,967
Gimv N.V.		1,456		75,487
Groupe Bruxelles Lambert S.A.		2,848		287,961
Sofina S.A.		630		75,621
				543,036
Materials 0.2%
Nyrstar NV *(a)		49,159		195,732
Tessenderlo Chemie N.V.		7,460		228,457
				424,189
Media 0.1%
Telenet Group Holding N.V.		4,127		241,878
Real Estate 0.1%
Befimmo S.C.A.		801		58,341
Cofinimmo		906		111,020
				169,361
Retailing 0.1%
S.A. D’Ieteren N.V.		4,918		227,522
Technology Hardware & Equipment 0.1%
Barco N.V.		1,370		102,101
EVS Broadcast Equipment S.A.		957		60,601
				162,702
Telecommunication Services 0.2%
Mobistar S.A.		15,868		309,662
Utilities 0.1%
Elia System Operator S.A./N.V.		3,457		183,363
				2,377,846
Canada 8.7%
Automobiles & Components 0.2%
Linamar Corp.		3,909		195,691
Martinrea International, Inc.		11,097		111,775
				307,466
Banks 0.2%
Canadian Western Bank		2,543		86,170
Genworth MI Canada, Inc.		4,828		169,369
Home Capital Group, Inc.		2,228		94,137
Laurentian Bank of Canada		2,259		97,034
				446,710
Capital Goods 0.6%
Aecon Group, Inc.		6,740		113,210
Bird Construction, Inc.		4,843		62,302
CAE, Inc.		15,065		198,887
MacDonald, Dettwiler & Associates Ltd.		2,471		191,629
Russel Metals, Inc.		9,859		290,090
Toromont Industries Ltd.		7,413		183,355
Wajax Corp.		3,178		102,787
WSP Global, Inc.		2,490		85,215
				1,227,475
Commercial & Professional Supplies 0.4%
Newalta Corp.		5,113		93,765
Progressive Waste Solutions Ltd.		9,124		222,096
Ritchie Bros. Auctioneers, Inc.		4,458		111,404
Stantec, Inc.		1,873		111,008
Transcontinental, Inc., Class A		14,055		204,789
				743,062
Consumer Durables & Apparel 0.2%
Dorel Industries, Inc., Class B		5,166		185,138

See financial notes 33

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Gildan Activewear, Inc.		3,878		198,243
Lululemon Athletica, Inc. *(a)		1,009		46,343
				429,724
Consumer Services 0.0%
EnerCare, Inc.		6,871		69,584
Diversified Financials 0.3%
AGF Management Ltd., Class B		14,766		164,493
CI Financial Corp.		9,105		295,733
Dundee Corp., Class A *		5,840		85,252
GMP Capital, Inc.		9,803		74,324
				619,802
Energy 2.4%
Advantage Oil & Gas Ltd. *		34,177		216,403
AltaGas Ltd.		5,509		234,725
Calfrac Well Services Ltd.		2,225		77,039
Enerflex Ltd.		9,206		146,483
Ensign Energy Services, Inc.		12,777		201,089
Freehold Royalties Ltd.		3,019		68,475
Gibson Energy, Inc.		8,278		220,988
Gran Tierra Energy, Inc. *		8,597		61,102
Keyera Corp.		3,709		246,691
Lightstream Resources Ltd. (a)		43,514		261,628
Mullen Group Ltd.		8,079		219,067
NuVista Energy Ltd. *		7,445		74,311
Pacific Rubiales Energy Corp.		14,645		239,039
Parkland Fuel Corp.		8,212		152,095
Pason Systems, Inc.		2,867		79,624
Pembina Pipeline Corp.		8,755		344,033
Peyto Exploration & Development Corp.		4,239		156,287
Precision Drilling Corp.		28,849		375,073
Savanna Energy Services Corp.		7,950		64,482
ShawCor Ltd.		4,526		201,596
Trican Well Service Ltd.		13,588		194,637
Trinidad Drilling Ltd.		14,380		160,849
Veresen, Inc.		16,140		238,702
Vermilion Energy, Inc.		4,851		322,780
				4,557,198
Food & Staples Retailing 0.2%
Liquor Stores N.A. Ltd.		4,419		47,897
The Jean Coutu Group (PJC), Inc., Class A		6,989		140,858
The North West Co., Inc.		6,291		139,130
				327,885
Food, Beverage & Tobacco 0.2%
Cott Corp.		13,677		111,058
Maple Leaf Foods, Inc.		12,872		212,684
				323,742
Insurance 0.1%
Industrial Alliance Insurance & Financial Services, Inc.		4,467		184,418
Materials 1.5%
Agnico-Eagle Mines Ltd.		7,215		213,083
Canfor Corp. *		4,342		98,483
CCL Industries, Inc., Class B		1,475		134,117
Centerra Gold, Inc.		26,963		138,253
Chemtrade Logistics Income Fund (a)		4,489		83,141
Dominion Diamond Corp. *		6,388		80,254
Eldorado Gold Corp.		19,391		118,181
Franco-Nevada Corp.		1,541		74,277
HudBay Minerals, Inc.		21,480		183,238
IAMGOLD Corp.		48,718		169,794
Lundin Mining Corp. *		44,074		225,185
Major Drilling Group International, Inc.		10,425		81,988
Methanex Corp.		5,593		346,434
New Gold, Inc. *		10,484		52,991
PAN American Silver Corp.		8,952		115,979
Sherritt International Corp.		80,032		338,806
Silver Wheaton Corp.		3,797		84,216
Thompson Creek Metals Co., Inc. *(a)		38,765		103,982
West Fraser Timber Co., Ltd.		5,604		250,532
				2,892,934
Media 0.5%
Aimia, Inc.		12,961		208,715
Cineplex, Inc.		4,462		168,172
Cogeco Cable, Inc.		1,867		102,203
Corus Entertainment, Inc., Class B		6,731		151,195
Quebecor, Inc., Class B		12,318		290,516
				920,801
Real Estate 0.5%
Boardwalk Real Estate Investment Trust		1,154		65,046
Brookfield Office Properties, Inc.		11,927		236,570
Calloway Real Estate Investment Trust		2,872		70,172
Canadian Real Estate Investment Trust		1,567		64,593
First Capital Realty, Inc.		4,138		67,768
Granite Real Estate Investment Trust		3,025		116,524
H&R REIT		4,259		89,684
RioCan REIT (a)		6,003		149,137
				859,494
Retailing 0.3%
Dollarama, Inc.		1,778		147,879
Reitmans (Canada) Ltd., Class A		21,983		133,376
Sears Canada, Inc.		16,831		246,465
				527,720
Software & Services 0.2%
Davis & Henderson Corp.		4,918		142,418
Open Text Corp.		2,979		146,905
				289,323
Telecommunication Services 0.1%
Manitoba Telecom Services, Inc.		5,501		152,023
Transportation 0.1%
TransForce, Inc.		9,156		199,902
Westshore Terminals Investment Corp.		2,051		66,655
				266,557
Utilities 0.7%
Atco Ltd., Class I		6,657		325,000
Capital Power Corp.		9,721		218,358
Emera, Inc.		9,166		283,497

34 See financial notes

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Just Energy Group, Inc. (a)		22,544		179,151
Northland Power, Inc.		3,512		54,888
Superior Plus Corp.		21,340		257,198
				1,318,092
				16,464,010
Denmark 1.4%
Banks 0.2%
Jyske Bank A/S - Reg’d *		3,578		196,718
Sydbank A/S *		7,048		187,984
				384,702
Capital Goods 0.2%
NKT Holding A/S		3,018		190,409
Rockwool International A/S, B Shares		703		135,604
Solar A/S, B Shares		1,989		137,529
				463,542
Consumer Durables & Apparel 0.1%
Pandora A/S		2,035		137,180
Food, Beverage & Tobacco 0.1%
Royal UNIBREW *		525		81,722
Schouw & Co.		2,034		113,538
				195,260
Health Care Equipment & Services 0.2%
Coloplast A/S, Class B		2,736		229,805
GN Store Nord A/S		5,231		126,374
William Demant Holding A/S *		769		68,912
				425,091
Insurance 0.1%
Topdanmark A/S *		3,096		90,588
Tryg A/S		1,328		126,125
				216,713
Materials 0.2%
Christian Hansen Holding A/S		2,107		94,994
Novozymes A/S, B Shares		5,821		279,088
				374,082
Pharmaceuticals, Biotechnology & Life Sciences 0.1%
H. Lundbeck A/S		6,487		189,063
Software & Services 0.1%
SimCorp A/S		2,877		110,459
Transportation 0.1%
D/S Norden A/S		6,432		257,263
				2,753,355
Finland 1.8%
Automobiles & Components 0.1%
Nokian Renkaat Oyj		6,774		269,564
Capital Goods 0.5%
Cargotec Oyj, B Shares		3,699		165,355
Cramo Oyj		3,820		85,354
Konecranes Oyj		5,401		174,324
Outotec Oyj (a)		11,892		133,279
Ramirent Oyj		6,938		77,768
Uponor Oyj		6,355		125,813
YIT Oyj (a)		21,415		220,275
				982,168
Consumer Durables & Apparel 0.1%
Amer Sports Oyj		10,229		211,491
Materials 0.7%
Huhtamaki Oyj (a)		11,099		291,839
Kemira Oyj		13,196		201,712
Metsa Board Oyj		29,860		139,778
Outokumpu Oyj *		543,518		166,298
Rautaruukki Oyj *		35,341		440,283
Tikkurila Oyj		2,908		72,135
				1,312,045
Media 0.1%
Sanoma Oyj		30,220		203,172
Real Estate 0.0%
Sponda Oyj		12,533		64,627
Retailing 0.1%
Stockmann Oyj Abp, B Shares		6,906		98,079
Software & Services 0.2%
Tieto Oyj		11,030		301,839
				3,442,985
France 4.9%
Automobiles & Components 0.3%
Faurecia *		7,952		357,940
Plastic Omnium S.A.		3,591		122,185
				480,125
Banks 0.1%
Natixis		30,476		216,339
Capital Goods 0.3%
Areva S.A. *		5,622		141,563
Mersen		3,595		115,113
Saft Groupe S.A.		2,981		106,015
Zodiac Aerospace		8,406		279,480
				642,171
Commercial & Professional Supplies 0.6%
Bureau Veritas S.A.		6,946		212,858
Derichebourg S.A.		26,376		102,828
Edenred		7,952		268,768
Societe BIC S.A.		2,077		275,561
Teleperformance		5,738		329,088
				1,189,103
Consumer Durables & Apparel 0.3%
Nexity S.A.		5,877		263,628
SEB S.A.		2,578		237,797
				501,425
Consumer Services 0.1%
Club Mediterranee S.A. *		4,546		118,570
Diversified Financials 0.2%
Eurazeo S.A.		3,557		299,852
Energy 0.1%
Bourbon S.A.		4,648		153,378
Etablissements Maurel et Prom		5,744		102,486
				255,864

See financial notes 35

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Food, Beverage & Tobacco 0.1%
Remy Cointreau S.A.		1,125		98,937
Vilmorin & Cie		521		68,775
				167,712
Health Care Equipment & Services 0.1%
BioMerieux		1,060		115,750
Orpea		1,337		97,260
				213,010
Insurance 0.1%
Euler Hermes S.A.		1,148		138,511
Materials 0.3%
Eramet		2,461		321,010
Imerys S.A.		3,313		290,938
				611,948
Media 0.6%
Havas S.A.		15,214		121,091
IPSOS		2,433		94,499
JC Decaux S.A.		3,711		152,337
Metropole Television S.A.		10,454		223,932
Societe Television Francaise 1		15,755		268,276
Technicolor - Reg’d *		37,615		281,235
				1,141,370
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
Ipsen S.A.		1,937		86,003
Real Estate 0.6%
Fonciere des Regions		2,811		285,526
Gecina S.A.		1,018		137,025
ICADE (a)		3,255		332,102
Klepierre		5,092		233,626
Mercialys		3,442		79,174
				1,067,453
Software & Services 0.4%
Alten		2,174		111,074
Altran Technologies S.A.		10,672		116,349
Dassault Systemes S.A.		1,400		172,281
UBISOFT Entertainment *		13,600		253,799
				653,503
Technology Hardware & Equipment 0.2%
Ingenico (a)		1,342		117,105
Neopost S.A.		4,020		330,094
				447,199
Telecommunication Services 0.1%
Iliad S.A.		625		168,650
Transportation 0.4%
Aeroports de Paris		2,387		296,837
Bollore		319		203,318
Groupe Eurotunnel S.A. - Reg’d		19,183		257,528
				757,683
				9,156,491
Germany 3.3%
Automobiles & Components 0.2%
ElringKlinger AG		1,762		71,137
Grammer AG		1,556		85,992
Leoni AG		3,630		270,578
				427,707
Banks 0.1%
Aareal Bank AG *		2,860		130,000
Capital Goods 0.7%
Bauer AG		2,665		69,235
BayWa AG		2,736		155,202
Deutz AG *		12,088		101,080
DMG MORI SEIKI AG		4,224		133,104
Duerr AG		995		78,730
Heidelberger Druckmaschinen AG *		57,394		182,038
Indus Holding AG		3,227		151,450
Krones AG		1,087		104,065
Nordex SE *		4,509		72,192
Pfeiffer Vacuum Technology AG		609		72,441
SGL Carbon SE (a)		2,727		90,813
Vossloh AG		577		56,956
				1,267,306
Consumer Durables & Apparel 0.2%
Gerry Weber International AG		1,475		77,903
Hugo Boss AG		843		117,116
Puma SE		352		103,989
				299,008
Food, Beverage & Tobacco 0.1%
Suedzucker AG (a)		8,958		191,424
Health Care Equipment & Services 0.2%
Draegerwerk AG & Co. KGaA		169		17,355
Rhoen-Klinikum AG		10,054		324,510
				341,865
Insurance 0.0%
Talanx AG *		2,043		78,177
Materials 0.4%
Fuchs Petrolub AG		867		79,933
Symrise AG		6,140		310,172
Wacker Chemie AG		2,430		285,648
				675,753
Media 0.2%
Axel Springer SE		3,582		218,724
ProSiebenSat.1 Media AG - Reg’d		4,586		200,719
				419,443
Pharmaceuticals, Biotechnology & Life Sciences 0.2%
Gerresheimer AG		2,257		153,220
Stada Arzneimittel AG		4,476		195,179
				348,399
Real Estate 0.1%
Deutsche Euroshop AG		1,500		72,319
GAGFAH S.A. *		5,957		94,217
GSW Immobilien AG		1,416		69,366
				235,902
Retailing 0.1%
Fielmann AG		706		95,512
Semiconductors & Semiconductor Equipment 0.1%
Aixtron SE *		7,052		112,280
Kontron AG		10,502		73,320

36 See financial notes

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
SMA Solar Technology AG		1,778		74,451
				260,051
Software & Services 0.3%
Bechtle AG		1,975		175,750
Software AG		5,413		203,886
United Internet AG - Reg’d		3,995		171,622
				551,258
Technology Hardware & Equipment 0.2%
Jenoptik AG		3,876		64,699
Wincor Nixdorf AG		3,987		261,181
				325,880
Telecommunication Services 0.1%
Telefonica Deutschland Holding AG		28,991		241,189
Transportation 0.1%
Fraport AG Frankfurt Airport Services Worldwide		2,798		206,932
Hamburger Hafen und Logistik AG		3,198		77,556
				284,488
				6,173,362
Greece 0.0%
Banks 0.0%
TT Hellenic Postbank S.A. *(b)(c)		24,275		—
Hong Kong 2.8%
Automobiles & Components 0.0%
Xinyi Glass Holdings Ltd.		66,000		52,161
Banks 0.2%
Bank of East Asia Ltd.		49,800		205,718
Wing Hang Bank Ltd.		6,000		96,582
				302,300
Capital Goods 0.2%
Johnson Electric Holdings Ltd.		116,000		110,953
NWS Holdings Ltd.		90,000		154,347
Singamas Container Holdings Ltd.		224,000		48,594
				313,894
Consumer Durables & Apparel 0.1%
Techtronic Industries Co.		65,000		207,683
Consumer Services 0.4%
Cafe De Coral Holdings Ltd.		22,000		69,184
Galaxy Entertainment Group Ltd. *		11,000		86,836
Sands China Ltd.		28,800		211,443
SJM Holdings Ltd.		65,000		180,825
Wynn Macau Ltd.		32,000		126,642
				674,930
Diversified Financials 0.1%
First Pacific Co., Ltd.		174,000		193,491
Guoco Group Ltd.		6,000		71,934
				265,425
Food & Staples Retailing 0.0%
Dairy Farm International Holdings Ltd.		8,100		82,701
Media 0.1%
Television Broadcasts Ltd.		16,500		103,078
Real Estate 1.0%
Great Eagle Holdings Ltd.		18,000		64,519
Hang Lung Group Ltd.		36,000		195,507
Hang Lung Properties Ltd.		67,000		199,837
Henderson Land Development Co., Ltd.		26,400		157,805
Hongkong Land Holdings Ltd.		44,000		308,375
Hysan Development Co., Ltd.		14,000		60,044
Kerry Properties Ltd.		46,000		151,478
New World Development Co., Ltd.		220,000		227,613
Sino Land Co., Ltd.		140,000		209,929
Swire Properties Ltd.		33,600		101,188
Wheelock & Co., Ltd.		44,000		181,616
				1,857,911
Retailing 0.1%
Chow Sang Sang Holdings International Ltd.		38,000		93,443
Luk Fook Holdings International Ltd.		25,000		70,987
				164,430
Technology Hardware & Equipment 0.1%
VTech Holdings Ltd.		15,600		215,299
Telecommunication Services 0.0%
Hutchison Telecommunications Hong Kong Holdings Ltd.		154,000		50,453
Transportation 0.5%
Cathay Pacific Airways Ltd.		132,000		249,465
MTR Corp., Ltd.		56,000		211,617
Orient Overseas International Ltd.		55,000		263,103
Pacific Basin Shipping Ltd.		328,000		191,406
				915,591
				5,205,856
Ireland 0.7%
Capital Goods 0.2%
Grafton Group plc		26,259		258,282
Kingspan Group plc		11,157		209,968
				468,250
Consumer Services 0.1%
Paddy Power plc		1,308		100,921
Food, Beverage & Tobacco 0.2%
C&C Group plc		28,018		166,756
Glanbia plc		7,609		113,637
				280,393
Health Care Equipment & Services 0.1%
UDG Healthcare plc		28,623		173,349
Insurance 0.0%
FBD Holdings plc		2,793		67,209

See financial notes 37

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Materials 0.1%
James Hardie Industries plc CDI		11,659		149,681
Transportation 0.0%
Aer Lingus Group plc		27,245		57,453
				1,297,256
Israel 1.2%
Banks 0.3%
Bank Hapoalim B.M.		48,227		272,434
Israel Discount Bank Ltd., Class A *		69,951		125,069
Mizrahi Tefahot Bank Ltd.		7,757		103,694
				501,197
Capital Goods 0.2%
Discount Investment Corp. - Reg’d *		23,939		219,478
Elbit Systems Ltd.		2,210		130,457
				349,935
Energy 0.2%
Delek Group Ltd.		338		136,988
Oil Refineries Ltd. *		313,056		87,253
Paz Oil Co., Ltd.		853		133,280
				357,521
Food & Staples Retailing 0.0%
Shufersal Ltd.		14,753		55,175
Materials 0.1%
The Israel Corp., Ltd. *		461		260,322
Software & Services 0.2%
Check Point Software Technologies Ltd. *		4,467		286,156
NICE Systems Ltd.		2,000		86,557
				372,713
Telecommunication Services 0.2%
Cellcom Israel Ltd.		19,808		251,129
Partner Communications Co., Ltd. *		22,277		199,477
				450,606
				2,347,469
Italy 2.9%
Automobiles & Components 0.1%
Piaggio & C. S.p.A.		27,792		114,989
Banks 0.4%
Banca Carige S.p.A. *(a)		255,403		188,793
Banca Popolare Di Sondrio Scarl		36,039		258,826
Credito Valtellinese Scarl *(a)		106,890		255,185
				702,804
Capital Goods 0.2%
Astaldi S.p.A.		6,707		72,683
C.I.R. S.p.A. - Compagnie Industriali Riunite *		102,595		158,189
Danieli S.p.A. - Officine Meccaniche Danieli & C.		824		29,594
Danieli S.p.A. - Officine Meccaniche Danieli & C. - RSP		2,610		62,555
Salini Impregilo S.p.A.		19,534		124,787
				447,808
Consumer Durables & Apparel 0.4%
De’Longhi S.p.A.		3,788		82,332
Geox S.p.A.		18,400		80,079
Indesit Co., S.p.A.		6,826		97,480
Luxottica Group S.p.A.		5,595		320,910
Prada S.p.A.		9,500		76,190
Safilo Group S.p.A. *		3,856		88,059
Tod’s S.p.A.		475		66,563
				811,613
Consumer Services 0.2%
Autogrill S.p.A. *		15,393		147,762
Gtech S.p.A.		6,611		194,047
				341,809
Diversified Financials 0.1%
Azimut Holding S.p.A.		2,605		81,322
Energy 0.3%
ERG S.p.A.		16,024		276,552
Saras S.p.A. *(a)		148,257		257,233
				533,785
Food, Beverage & Tobacco 0.1%
Davide Campari-Milano S.p.A.		12,794		111,213
Parmalat S.p.A.		40,941		142,238
				253,451
Health Care Equipment & Services 0.0%
Sorin S.p.A. *		22,386		68,330
Insurance 0.2%
Mediolanum S.p.A.		7,671		69,044
Societa Cattolica di Assicurazioni S.c.r.l.		3,630		89,780
Unipol Gruppo Finanziario S.p.A.		24,925		180,554
UnipolSai S.p.A. *		16,232		59,727
				399,105
Materials 0.1%
Buzzi Unicem S.p.A.		14,835		263,178
Media 0.1%
RCS MediaGroup S.p.A. *(a)		37,966		87,284
Pharmaceuticals, Biotechnology & Life Sciences 0.1%
Recordati S.p.A.		6,577		115,131
Real Estate 0.0%
Beni Stabili S.p.A.		90,436		80,844
Transportation 0.2%
Alitalia S.p.A. *(b)(c)		14,782		—
Ansaldo STS S.p.A.		8,060		89,602
Autostrada Torino-Milano S.p.A.		7,602		128,849
Societa Iniziative Autostradali e Servizi S.p.A.		9,761		116,073
				334,524
Utilities 0.4%
ACEA S.p.A.		10,148		145,628
Enel Green Power S.p.A.		69,590		199,167
Hera S.p.A.		86,535		254,755

38 See financial notes

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Iren S.p.A.		96,141		163,366
				762,916
				5,398,893
Japan 35.0%
Automobiles & Components 2.9%
Aisan Industry Co., Ltd.		6,000		47,742
Akebono Brake Industry Co., Ltd.		13,300		67,655
Calsonic Kansei Corp.		46,000		226,602
Exedy Corp.		5,800		155,177
F.C.C. Co., Ltd.		6,100		104,271
Futaba Industrial Co., Ltd.		31,300		140,216
Imasen Electric Industrial		3,899		48,900
Keihin Corp.		11,700		169,795
Koito Manufacturing Co., Ltd.		14,000		304,494
KYB Co., Ltd.		26,000		105,912
Mitsuba Corp.		4,300		63,125
Mitsubishi Motors Corp.		19,000		205,928
Musashi Seimitsu Industry Co., Ltd.		4,900		108,128
NGK Spark Plug Co., Ltd.		13,000		297,630
Nifco, Inc.		5,500		153,621
Nippon Seiki Co., Ltd.		8,000		139,882
Nissan Shatai Co., Ltd.		16,400		249,848
Nissin Kogyo Co., Ltd.		6,500		119,971
NOK Corp.		15,800		258,311
Press Kogyo Co., Ltd.		20,000		73,349
Riken Corp.		15,000		61,371
Sanden Corp.		20,000		95,532
Showa Corp.		8,600		94,573
Sumitomo Rubber Industries Ltd.		20,500		284,906
T RAD Co., Ltd.		22,000		57,446
Tachi-S Co., Ltd.		8,500		132,964
Takata Corp.		6,500		153,153
The Yokohama Rubber Co., Ltd.		23,000		205,436
Tokai Rika Co., Ltd.		10,000		173,792
Tokai Rubber Industries Ltd.		11,600		119,988
Toyo Tire & Rubber Co., Ltd.		21,000		156,594
Toyoda Gosei Co., Ltd.		11,800		217,425
Toyota Boshoku Corp. (a)		20,100		207,781
TS Tech Co., Ltd.		5,200		138,683
Unipres Corp.		9,300		179,686
Yorozu Corp.		4,000		74,766
				5,394,653
Banks 1.6%
Aozora Bank Ltd.		23,000		68,420
Fukuoka Financial Group, Inc.		55,000		224,620
Hokuhoku Financial Group, Inc.		105,000		202,623
Seven Bank Ltd.		24,900		94,401
Shinsei Bank Ltd.		88,000		171,567
Suruga Bank Ltd.		7,000		120,078
The 77 Bank Ltd.		18,000		81,261
The Awa Bank Ltd.		12,000		64,258
The Bank of Kyoto Ltd.		12,000		97,777
The Chugoku Bank Ltd.		10,900		144,494
The Daishi Bank Ltd.		18,000		65,011
The Gunma Bank Ltd.		22,000		116,936
The Hachijuni Bank Ltd.		24,000		131,206
The Hiroshima Bank Ltd.		24,000		98,742
The Hyakugo Bank Ltd.		15,000		58,119
The Iyo Bank Ltd.		11,200		100,700
The Joyo Bank Ltd.		26,000		126,544
The Juroku Bank Ltd.		20,000		69,864
The Kagoshima Bank Ltd.		10,000		62,461
The Keiyo Bank Ltd.		17,000		74,827
The Kiyo Bank Ltd.		4,300		50,598
The Musashino Bank Ltd.		2,200		70,499
The Nishi-Nippon City Bank Ltd.		40,000		90,984
The Ogaki Kyoritsu Bank Ltd.		26,000		70,227
The San-in Godo Bank Ltd.		12,000		79,202
The Shiga Bank Ltd.		11,000		60,151
The Shizuoka Bank Ltd.		23,000		219,765
Yamaguchi Financial Group, Inc.		16,000		147,549
				2,962,884
Capital Goods 6.5%
Aica Kogyo Co., Ltd.		5,300		110,835
Amada Co., Ltd.		34,000		245,895
Asahi Diamond Industrial Co., Ltd.		5,700		77,140
Central Glass Co., Ltd.		47,000		154,128
Chiyoda Corp.		12,000		160,917
CKD Corp.		6,800		61,945
COMSYS Holdings Corp.		19,200		314,766
Daifuku Co., Ltd.		11,000		126,826
Daihen Corp.		14,000		53,058
DMG Mori Seiki Co., Ltd.		9,000		112,275
Ebara Corp.		44,000		261,719
Fuji Electric Co., Ltd.		53,000		240,529
Fuji Machine Manufacturing Co., Ltd.		11,038		97,604
Fujitec Co., Ltd.		6,600		76,101
Furukawa Co., Ltd.		29,000		52,603
Futaba Corp.		5,600		88,013
Glory Ltd.		7,500		194,036
GS Yuasa Corp.		33,000		186,733
Hino Motors Ltd.		18,500		243,721
Hitachi Construction Machinery Co., Ltd.		13,000		241,235
Hitachi Koki Co., Ltd.		8,400		62,574
Hitachi Zosen Corp.		20,900		102,547
Hoshizaki Electric Co., Ltd.		4,400		178,039
Inaba Denki Sangyo Co., Ltd.		4,300		132,055
Inabata & Co., Ltd.		13,800		129,869
Iseki & Co., Ltd.		18,000		46,517
Iwatani Corp.		43,000		252,336
Kamei Corp.		16,300		120,026
Kandenko Co., Ltd.		31,000		166,293
Kanematsu Corp.		107,000		164,660
Keihan Electric Railway Co., Ltd.		39,000		160,775
Kinden Corp.		27,000		248,570
Kitz Corp.		18,200		85,942
Komori Corp.		7,200		91,576
Kurita Water Industries Ltd.		12,800		269,569
Kuroda Electric Co., Ltd.		8,100		130,135
Kyowa Exeo Corp.		16,800		217,320
Mabuchi Motor Co., Ltd.		2,000		136,953
Maeda Corp.		19,000		141,392
Maeda Road Construction Co., Ltd.		10,000		155,056
Makino Milling Machine Co., Ltd.		11,000		81,894
Meidensha Corp.		18,000		74,517
Minebea Co., Ltd.		40,000		324,159

See financial notes 39

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Mirait Holdings Corp.		17,500		153,931
MISUMI Group, Inc.		6,400		155,739
Miura Co., Ltd.		3,400		96,581
Nabtesco Corp.		6,200		133,848
Nachi-Fujikoshi Corp.		17,000		105,140
NGK Insulators Ltd.		18,000		340,397
Nichias Corp.		15,000		101,604
Nippo Corp.		9,000		137,515
Nippon Densetsu Kogyo Co., Ltd.		7,000		103,884
Nishimatsu Construction Co., Ltd.		57,000		205,106
Nisshinbo Holdings, Inc.		23,000		197,047
Nitta Corp.		2,800		57,520
Nitto Boseki Co., Ltd. *		13,000		54,245
Nitto Kogyo Corp.		3,100		64,274
Noritake Co., Ltd.		23,000		56,282
Noritz Corp.		5,100		90,606
NTN Corp. *		74,000		253,259
Oiles Corp.		2,900		65,314
Okuma Corp.		11,000		94,153
Okumura Corp.		24,000		109,651
OSG Corp.		5,700		91,875
Penta-Ocean Construction Co., Ltd.		37,000		121,015
Ryobi Ltd.		30,000		88,874
Sanki Engineering Co., Ltd.		13,000		79,785
Sankyo Tateyama, Inc.		4,200		83,126
Sanwa Holdings Corp.		22,000		134,403
Shinmaywa Industries Ltd.		13,000		114,802
Sintokogio Ltd.		8,000		57,488
Star Micronics Co., Ltd.		5,500		67,902
Tadano Ltd.		6,000		84,839
Taikisha Ltd.		3,700		80,056
Takara Standard Co., Ltd.		14,000		99,997
Takasago Thermal Engineering Co., Ltd.		11,100		108,525
The Japan Steel Works Ltd.		37,000		156,330
The Nippon Road Co., Ltd.		11,000		55,998
THK Co., Ltd.		10,100		213,479
Toa Corp.		37,000		69,603
Toda Corp.		43,000		150,697
TOKAI Holdings Corp.		25,800		89,445
Toshiba Machine Co., Ltd.		16,000		71,858
Toshiba Plant Systems & Services Corp.		4,000		58,851
Totetsu Kogyo Co., Ltd.		3,400		69,037
TOTO Ltd.		21,000		297,052
Toyo Engineering Corp.		21,000		92,662
Trusco Nakayama Corp.		5,200		117,193
Tsubakimoto Chain Co.		13,000		92,779
Ushio, Inc.		13,000		169,801
Yamazen Corp.		13,800		89,152
Yuasa Trading Co., Ltd.		40,000		76,109
				12,231,682
Commercial & Professional Supplies 0.8%
Aeon Delight Co., Ltd.		3,100		68,381
Duskin Co., Ltd.		9,500		175,610
Kokuyo Co., Ltd.		23,800		182,002
Kyodo Printing Co., Ltd.		25,000		67,352
Matsuda Sangyo Co., Ltd.		4,796		53,306
Meitec Corp.		3,100		82,532
Moshi Moshi Hotline, Inc.		5,800		58,713
Nissha Printing Co., Ltd. *(a)		5,600		72,994
Okamura Corp.		11,000		94,095
Park24 Co., Ltd.		5,000		91,396
Sato Holdings Corp.		2,700		58,601
Sohgo Security Services Co., Ltd.		10,500		222,611
Temp Holdings Co., Ltd.		4,000		101,757
Toppan Forms Co., Ltd.		12,100		111,178
				1,440,528
Consumer Durables & Apparel 1.7%
Alpine Electronics, Inc.		9,700		115,648
Asics Corp.		10,700		208,258
Casio Computer Co., Ltd.		26,900		306,962
Foster Electric Co., Ltd.		4,300		52,085
Funai Electric Co., Ltd. *		13,100		140,676
Gunze Ltd.		48,000		131,072
Haseko Corp.		23,200		146,919
JVC Kenwood Corp. *		69,460		146,832
Kurabo Industries Ltd.		45,000		76,652
Onward Holdings Co., Ltd.		25,000		168,152
PanaHome Corp.		17,000		113,040
Pioneer Corp. *		96,800		209,155
Rinnai Corp.		2,200		183,345
Sangetsu Co., Ltd.		4,500		115,952
Sankyo Co., Ltd.		6,600		263,941
Sanyo Shokai Ltd.		26,000		70,947
Sumitomo Forestry Co., Ltd.		23,600		240,030
Tamron Co., Ltd.		2,300		57,530
Token Corp.		1,750		77,683
Tomy Co., Ltd.		19,700		93,483
TSI Holdings Co., Ltd.		16,000		107,898
Unitika Ltd. *		110,000		62,401
Wacoal Holdings Corp.		14,000		138,099
				3,226,760
Consumer Services 0.7%
Accordia Golf Co., Ltd.		9,100		116,737
Doutor Nichires Holdings Co., Ltd.		5,100		91,409
H.I.S. Co., Ltd.		5,000		138,665
McDonald’s Holdings Co., Ltd. (a)		8,533		236,094
MOS Food Services, Inc.		3,000		59,789
Plenus Co., Ltd.		4,000		91,286
Resorttrust, Inc.		4,200		65,897
Round One Corp.		12,100		86,912
Royal Holdings Co., Ltd.		4,700		68,554
Saizeriya Co., Ltd.		6,500		74,476
Tokyo Dome Corp.		9,000		40,305
Yoshinoya Holdings Co., Ltd.		9,000		113,976
Zensho Holdings Co., Ltd.		8,200		82,895
				1,266,995
Diversified Financials 0.6%
Acom Co., Ltd. *		35,400		120,649
AEON Financial Service Co., Ltd.		5,500		138,508
Aiful Corp. *		27,600		94,253
Century Tokyo Leasing Corp.		2,500		72,349
Daiwa Securities Group, Inc.		26,000		194,959
Hitachi Capital Corp.		3,300		81,337
Jaccs Co., Ltd.		17,000		75,427
Mitsubishi UFJ Lease & Finance Co., Ltd.		21,000		103,610
Orient Corp. *		52,800		111,201

40 See financial notes

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
SBI Holdings, Inc.		11,700		133,801
				1,126,094
Energy 0.1%
Japan Petroleum Exploration Co.		4,000		148,904
Shinko Plantech Co., Ltd.		8,600		64,742
				213,646
Food & Staples Retailing 1.3%
Ain Pharmaciez, Inc.		1,600		70,360
Arcs Co., Ltd.		9,000		180,559
Cawachi Ltd.		6,400		116,688
Cocokara fine, Inc.		4,900		138,925
Cosmos Pharmaceutical Corp.		600		64,178
FamilyMart Co., Ltd.		5,100		211,778
Heiwado Co., Ltd.		9,100		128,823
Kato Sangyo Co., Ltd.		9,200		191,348
Matsumotokiyoshi Holdings Co., Ltd.		7,700		227,223
Mitsubishi Shokuhin Co., Ltd.		3,800		85,088
San-A Co., Ltd.		3,500		100,871
Sugi Holdings Co., Ltd.		4,100		184,416
Sundrug Co., Ltd.		3,400		139,103
Tsuruha Holdings, Inc.		2,100		211,358
Valor Co., Ltd.		12,600		163,309
Welcia Holdings Co., Ltd.		1,200		72,591
Yokohama Reito Co., Ltd.		11,800		95,519
				2,382,137
Food, Beverage & Tobacco 2.5%
Calbee, Inc.		4,500		110,357
Coca-Cola Central Japan Co., Ltd.		8,600		193,814
Dydo Drinco, Inc.		2,100		85,328
Ezaki Glico Co., Ltd.		12,000		158,044
Fuji Oil Co., Ltd.		9,400		127,002
Hokuto Corp.		3,400		68,301
House Foods Corp.		11,400		189,698
Ito En Ltd.		8,000		171,040
Itoham Foods, Inc.		42,000		190,354
J-Oil Mills, Inc.		27,000		72,184
Kagome Co., Ltd.		9,400		159,070
Kewpie Corp.		19,100		274,744
Kikkoman Corp.		15,000		304,774
Marudai Food Co., Ltd.		40,000		119,059
Maruha Nichiro Corp. *		9,377		148,587
Megmilk Snow Brand Co., Ltd.		14,500		192,401
Mitsui Sugar Co., Ltd.		16,000		66,387
Morinaga & Co., Ltd.		42,000		92,576
Morinaga Milk Industry Co., Ltd.		78,000		291,159
Nichirei Corp.		52,000		252,510
Nippon Flour Mills Co., Ltd.		29,000		161,802
Nippon Suisan Kaisha Ltd. *		63,200		145,434
Nissin Foods Holdings Co., Ltd.		7,100		339,854
Prima Meat Packers Ltd.		35,000		77,206
Sapporo Holdings Ltd.		49,000		207,761
Takara Holdings, Inc.		16,000		122,497
The Nisshin Oillio Group Ltd.		34,000		113,839
Warabeya Nichiyo Co., Ltd.		4,300		80,278
Yakult Honsha Co., Ltd.		4,800		259,440
				4,775,500
Health Care Equipment & Services 0.5%
Miraca Holdings, Inc.		4,800		208,067
Nichii Gakkan Co.		8,900		78,502
Nihon Kohden Corp.		3,000		122,860
Nipro Corp. (a)		10,600		91,766
Ship Healthcare Holdings, Inc.		2,000		68,205
Sysmex Corp.		6,000		190,212
Toho Holdings Co., Ltd.		11,500		231,820
				991,432
Household & Personal Products 0.6%
Fancl Corp.		7,800		86,503
Kobayashi Pharmaceutical Co., Ltd.		2,700		163,946
Kose Corp.		3,600		119,653
Lion Corp.		26,000		142,433
Mandom Corp.		2,500		87,799
Pigeon Corp.		1,500		67,157
Pola Orbis Holdings, Inc.		2,700		105,666
Unicharm Corp.		4,900		265,717
				1,038,874
Insurance 0.1%
Sony Financial Holdings, Inc.		7,199		115,437
Materials 4.1%
ADEKA Corp.		14,800		162,608
Aichi Steel Corp.		22,000		81,132
Air Water, Inc.		10,000		140,313
Asahi Holdings, Inc.		6,900		108,964
Chugoku Marine Paints Ltd.		13,000		82,929
Daicel Corp.		36,000		301,492
Daido Steel Co., Ltd.		33,000		161,350
Daio Paper Corp.		19,000		199,331
Dowa Holdings Co., Ltd.		26,000		217,978
Earth Chemical Co., Ltd.		2,200		78,702
FP Corp.		2,700		83,973
Fuji Seal International, Inc.		2,800		91,101
Godo Steel Ltd.		44,000		61,956
Hitachi Chemical Co., Ltd.		19,100		280,992
Hitachi Metals Ltd.		16,990		230,712
Hokuetsu Kishu Paper Co., Ltd.		26,500		126,034
Ishihara Sangyo Kaisha Ltd. *		68,000		64,686
Kansai Paint Co., Ltd.		14,000		195,732
Kureha Corp.		27,000		127,680
Kyoei Steel Ltd.		4,700		81,471
Lintec Corp.		8,500		158,051
Maruichi Steel Tube Ltd.		5,800		147,124
Mitsubishi Gas Chemical Co., Inc.		39,000		225,166
Mitsubishi Paper Mills Ltd. *		85,000		73,124
Mitsubishi Steel Mfg. Co., Ltd.		29,000		58,129
Nihon Parkerizing Co., Ltd.		4,900		106,801
Nippon Denko Co., Ltd.		28,000		77,900
Nippon Kayaku Co., Ltd.		14,000		166,600
Nippon Paint Co., Ltd.		10,000		154,714
Nippon Shokubai Co., Ltd.		19,000		219,227
Nippon Soda Co., Ltd.		18,000		100,007
Nissan Chemical Industries Ltd.		13,100		195,234
Nittetsu Mining Co., Ltd.		17,000		63,456
NOF Corp.		19,000		131,772
Pacific Metals Co., Ltd. *		32,000		148,845
Rengo Co., Ltd.		40,000		178,749
Sanyo Chemical Industries Ltd.		10,000		61,255
Sanyo Special Steel Co., Ltd.		20,000		78,006
Sumitomo Bakelite Co., Ltd.		40,000		152,338

See financial notes 41

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Sumitomo Osaka Cement Co., Ltd.		45,000		178,971
Taiyo Nippon Sanso Corp.		37,000		294,918
Toagosei Co., Ltd.		40,000		167,379
Toho Zinc Co., Ltd.		26,000		82,724
Tokai Carbon Co., Ltd.		41,000		131,539
Tokuyama Corp.		76,000		220,414
Tokyo Ohka Kogyo Co., Ltd.		4,600		105,203
Tokyo Steel Manufacturing Co., Ltd.		37,000		180,898
Topy Industries Ltd.		56,000		94,822
Toyo Ink SC Holdings Co., Ltd.		31,000		126,460
Toyo Kohan Co., Ltd.		13,000		62,969
Toyobo Co., Ltd.		133,000		214,775
UACJ Corp.		27,300		107,988
Yamato Kogyo Co., Ltd.		4,300		124,004
Yodogawa Steel Works Ltd.		29,000		114,328
Zeon Corp.		17,000		158,072
				7,741,098
Media 0.5%
Asatsu-DK, Inc.		8,300		187,758
Avex Group Holdings, Inc.		2,800		51,861
CyberAgent, Inc.		2,100		86,701
Daiichikosho Co., Ltd.		5,100		146,960
Kadokawa Group Holdings, Inc.		2,400		78,804
SKY Perfect JSAT Holdings, Inc.		24,200		130,127
Toho Co., Ltd.		8,400		161,719
Tokyo Broadcasting System Holdings, Inc.		5,500		59,747
TV Asahi Holdings Corp.		2,900		50,530
Zenrin Co., Ltd.		5,800		59,160
				1,013,367
Pharmaceuticals, Biotechnology & Life Sciences 1.2%
Chugai Pharmaceutical Co., Ltd.		13,800		348,296
Dainippon Sumitomo Pharma Co., Ltd.		11,000		166,824
Hisamitsu Pharmaceutical Co., Inc.		3,800		159,038
Kaken Pharmaceutical Co., Ltd.		7,000		120,626
Kissei Pharmaceutical Co., Ltd.		3,100		72,599
KYORIN Holdings, Inc.		3,500		67,463
Kyowa Hakko Kirin Co., Ltd.		26,000		296,081
Mitsubishi Tanabe Pharma Corp.		20,400		279,731
Mochida Pharmaceutical Co., Ltd.		1,500		105,694
Nippon Shinyaku Co., Ltd.		4,000		70,464
Rohto Pharmaceutical Co., Ltd.		8,100		142,896
Santen Pharmaceutical Co., Ltd.		5,000		222,848
Sawai Pharmaceutical Co., Ltd.		1,100		68,077
Tsumura & Co.		5,000		118,845
				2,239,482
Real Estate 1.1%
Advance Residence Investment Corp.		50		113,127
Aeon Mall Co., Ltd.		3,830		91,314
Daikyo, Inc.		28,000		54,591
Japan Excellent, Inc.		50		66,400
Japan Prime Realty Investment Corp.		28		98,531
Japan Real Estate Investment Corp.		38		201,458
Japan Retail Fund Investment Corp.		91		183,029
Kenedix Realty Investment Corp.		17		84,923
Leopalace21 Corp. *		27,100		140,153
Nippon Building Fund, Inc.		44		243,956
Nomura Real Estate Holdings, Inc.		9,600		179,369
Nomura Real Estate Office Fund, Inc.		23		99,536
NTT Urban Development Corp.		5,900		51,893
Orix J-REIT, Inc.		77		97,954
Tokyo Tatemono Co., Ltd.		17,000		135,571
Tokyu Fudosan Holdings Corp.		27,600		200,651
United Urban Investment Corp.		66		99,610
				2,142,066
Retailing 2.3%
ABC-Mart, Inc.		1,600		71,850
Adastria Holdings Co., Ltd.		2,390		52,012
Alpen Co., Ltd.		3,400		62,641
Aoyama Trading Co., Ltd.		9,000		223,334
Arcland Sakamoto Co., Ltd.		3,500		69,300
Autobacs Seven Co., Ltd.		13,700		211,954
Bic Camera, Inc.		21,900		159,734
Canon Marketing Japan, Inc.		16,700		268,963
Chiyoda Co., Ltd.		5,000		118,712
DCM Holdings Co., Ltd.		32,200		217,842
Don Quijote Holdings Co., Ltd.		3,900		205,694
Doshisha Co., Ltd.		4,600		68,970
Geo Holdings Corp.		15,300		140,178
Gulliver International Co., Ltd.		9,200		75,296
H2O Retailing Corp.		26,000		196,210
Hikari Tsushin, Inc.		1,400		118,023
Izumi Co., Ltd.		4,800		140,461
Kohnan Shoji Co., Ltd.		12,100		122,491
Komeri Co., Ltd.		6,000		162,470
Marui Group Co., Ltd.		31,700		281,579
Nitori Holdings Co., Ltd.		6,800		311,907
Rakuten, Inc.		11,360		147,403
Ryohin Keikaku Co., Ltd.		2,200		247,243
T-Gaia Corp.		5,300		46,672
The Daiei, Inc. *		70,800		198,748
United Arrows Ltd.		1,700		65,752
USS Co., Ltd.		12,500		182,202
Xebio Co., Ltd.		6,800		125,760
				4,293,401
Semiconductors & Semiconductor Equipment 0.6%
Advantest Corp.		15,700		173,072
Dainippon Screen Manufacturing Co., Ltd.		21,000		91,595
Disco Corp.		1,600		97,231
Renesas Electronics Corp. *(a)		27,638		201,820
Sanken Electric Co., Ltd.		12,000		83,597
Shinko Electric Industries Co., Ltd.		11,800		77,711
Sumco Corp.		21,100		161,932
Tokyo Seimitsu Co., Ltd.		3,100		52,241
Ulvac, Inc. *		8,600		162,989
				1,102,188
Software & Services 1.4%
Capcom Co., Ltd.		5,600		97,536

42 See financial notes

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Dena Co., Ltd.		7,586		128,208
DTS Corp.		3,800		63,014
Fuji Soft, Inc.		3,900		81,582
Gree, Inc.		7,300		71,385
IT Holdings Corp.		19,000		294,538
Itochu Techno-Solutions Corp.		3,600		150,441
NEC Networks & System Integration Corp.		4,900		103,519
NET One Systems Co., Ltd.		22,700		184,686
Nexon Co., Ltd.		5,161		40,197
Nihon Unisys Ltd.		11,800		119,829
Nomura Research Institute Ltd.		9,000		260,976
NS Solutions Corp.		2,800		70,054
NSD Co., Ltd.		5,200		64,288
Obic Co., Ltd.		3,100		93,021
Otsuka Corp.		2,000		236,759
SCSK Corp.		2,876		76,075
Square Enix Holdings Co., Ltd.		6,700		107,767
Transcosmos, Inc.		3,700		68,980
Trend Micro, Inc.		5,400		174,674
Yahoo Japan Corp.		34,400		150,276
				2,637,805
Technology Hardware & Equipment 2.3%
Alps Electric Co., Ltd.		29,600		334,701
Amano Corp.		9,400		90,510
Anritsu Corp.		6,500		72,791
Azbil Corp.		9,300		211,042
Canon Electronics, Inc.		3,600		60,847
Citizen Holdings Co., Ltd.		32,900		241,615
Daiwabo Holdings Co., Ltd.		50,000		86,095
Eizo Corp.		3,650		98,961
Hamamatsu Photonics K.K.		4,100		184,737
Hirose Electric Co., Ltd.		1,900		268,192
Hitachi High-Technologies Corp.		12,900		295,101
Hitachi Kokusai Electric, Inc.		5,000		57,158
Horiba Ltd.		3,700		127,895
Hosiden Corp.		44,600		202,895
Japan Aviation Electronics Industry Ltd.		8,000		136,176
Macnica, Inc.		2,800		83,023
Melco Holdings, Inc.		3,900		59,304
Mitsumi Electric Co., Ltd.		33,100		212,100
Nichicon Corp.		8,200		60,823
Nippon Chemi-Con Corp. *		22,000		70,324
Oki Electric Industry Co., Ltd.		41,000		80,261
Riso Kagaku Corp.		3,800		93,739
Ryosan Co., Ltd.		9,900		209,259
Shimadzu Corp.		23,000		196,477
Taiyo Yuden Co., Ltd.		13,600		168,156
The Nippon Signal Co., Ltd.		8,200		67,995
Toshiba TEC Corp.		23,000		149,837
UKC Holdings Corp.		7,100		114,230
Yaskawa Electric Corp.		14,000		157,859
Yokogawa Electric Corp.		15,500		211,912
				4,404,015
Transportation 1.5%
Fukuyama Transporting Co., Ltd.		22,000		128,748
Hitachi Transport System Ltd.		8,800		135,035
Japan Airport Terminal Co., Ltd.		4,400		101,526
Kamigumi Co., Ltd.		35,000		333,631
Keikyu Corp.		23,000		190,912
Keio Corp.		42,000		297,259
Keisei Electric Railway Co., Ltd.		17,000		147,951
Kintetsu World Express, Inc.		3,200		126,998
Mitsubishi Logistics Corp.		9,000		129,123
Mitsui-Soko Co., Ltd.		13,000		51,578
Nankai Electric Railway Co., Ltd.		42,000		162,915
Nippon Konpo Unyu Soko Co., Ltd.		7,700		130,108
Nishi-Nippon Railroad Co., Ltd.		40,000		153,836
Odakyu Electric Railway Co., Ltd.		33,000		289,716
Sankyu, Inc.		60,000		228,709
Senko Co., Ltd.		15,000		68,559
Sotetsu Holdings, Inc.		33,000		117,938
The Sumitomo Warehouse Co., Ltd.		15,000		72,732
				2,867,274
Utilities 0.1%
Shizuoka Gas Co., Ltd.		12,400		74,614
The Okinawa Electric Power Co., Inc.		4,300		140,539
				215,153
				65,822,471
Luxembourg 0.6%
Banks 0.1%
Espirito Santo Financial Group S.A. *		39,829		176,596
Commercial & Professional Supplies 0.1%
Regus plc		38,437		135,920
Consumer Durables & Apparel 0.1%
Samsonite International S.A.		42,600		135,357
Household & Personal Products 0.1%
Oriflame Cosmetics S.A. SDR (a)		5,494		140,685
Materials 0.1%
AZ Electronic Materials S.A.		17,569		119,592
Ternium S.A. ADR		8,072		231,344
				350,936
Media 0.1%
RTL Group S.A. *		1,197		133,286
Semiconductors & Semiconductor Equipment 0.0%
Magnachip Semiconductor Corp. *		2,999		41,986
				1,114,766
Netherlands 2.1%
Capital Goods 0.6%
Aalberts Industries N.V.		7,443		247,940
AerCap Holdings N.V. *		6,216		259,394
Arcadis N.V.		4,440		157,807
Koninklijke Boskalis Westminster N.V.		6,483		367,435
Sensata Technologies Holding N.V. *		2,518		106,939
TKH Group N.V.		3,601		125,498
				1,265,013

See financial notes 43

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Commercial & Professional Supplies 0.2%
USG People N.V.		23,817		412,069
Consumer Durables & Apparel 0.1%
TomTom N.V. *		15,460		109,621
Diversified Financials 0.0%
BinckBank N.V.		4,962		56,065
Energy 0.3%
Core Laboratories N.V.		690		129,499
Koninklijke Vopak N.V.		2,847		141,955
SBM Offshore N.V. *		13,271		242,916
				514,370
Food & Staples Retailing 0.1%
X5 Retail Group N.V. - Reg’d GDR *		9,063		159,748
Food, Beverage & Tobacco 0.1%
Koninklijike Wessanen N.V.		22,690		134,054
Materials 0.1%
Koninklijke Ten Cate N.V.		4,694		139,853
Real Estate 0.3%
Corio N.V.		5,721		268,073
Eurocommercial Properties N.V.		2,076		95,308
Vastned Retail N.V.		2,088		107,441
Wereldhave N.V. (a)		1,663		139,844
				610,666
Semiconductors & Semiconductor Equipment 0.2%
ASM International N.V.		3,429		150,065
NXP Semiconductor N.V. *		3,492		208,193
				358,258
Telecommunication Services 0.1%
Ziggo N.V.		4,648		201,830
				3,961,547
New Zealand 0.6%
Consumer Services 0.1%
SKYCITY Entertainment Group Ltd.		41,279		150,734
Health Care Equipment & Services 0.0%
Fisher & Paykel Healthcare Corp., Ltd.		24,401		86,011
Materials 0.1%
Nuplex Industries Ltd.		37,713		113,964
Media 0.1%
SKY Network Television Ltd.		27,885		160,946
Real Estate 0.0%
Kiwi Income Property Trust		58,853		58,361
Telecommunication Services 0.1%
Chorus Ltd.		79,307		121,172
Transportation 0.1%
Air New Zealand Ltd.		48,436		87,769
Auckland International Airport Ltd.		25,866		88,589
Mainfreight Ltd.		6,404		74,009
				250,367
Utilities 0.1%
Contact Energy Ltd.		26,465		129,995
Infratil Ltd.		33,815		67,112
				197,107
				1,138,662
Norway 1.2%
Banks 0.1%
SpareBank 1 SMN		8,726		77,494
SpareBank 1 SR Bank A.S.A.		9,815		95,197
				172,691
Capital Goods 0.1%
Vard Holdings Ltd. *		79,000		61,034
Veidekke A.S.A.		16,323		175,057
				236,091
Commercial & Professional Supplies 0.0%
Tomra Systems A.S.A.		7,755		72,080
Diversified Financials 0.0%
Aker ASA, Class A		1,931		65,408
Energy 0.2%
Fred Olsen Energy A.S.A.		3,945		125,841
Kvaerner A.S.A.		34,699		69,504
TGS Nopec Geophysical Co. A.S.A.		8,135		280,612
				475,957
Food, Beverage & Tobacco 0.1%
Austevoll Seafood A.S.A.		10,267		66,506
Cermaq A.S.A.		7,020		82,963
Leroy Seafood Group A.S.A.		2,284		80,895
				230,364
Insurance 0.2%
Gjensidige Forsikring A.S.A. (a)		12,260		226,048
Storebrand ASA *		22,512		126,368
				352,416
Media 0.1%
Schibsted A.S.A.		3,085		177,512
Semiconductors & Semiconductor Equipment 0.2%
REC Silicon A.S.A. *		561,522		314,084
Software & Services 0.1%
Atea A.S.A. (a)		11,436		131,447
Transportation 0.1%
Golden Ocean Group Ltd.		55,251		97,982
				2,326,032
Portugal 0.4%
Banks 0.1%
Banco BPI S.A. - Reg’d *		43,540		111,756
Food & Staples Retailing 0.2%
Jeronimo Martins, SGPS, S.A.		10,706		187,241
Sonae		135,594		255,087
				442,328
Media 0.1%
ZON OPTIMUS SGPS, S.A.		12,736		92,137

44 See financial notes

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Utilities 0.0%
Redes Energeticas Nacionais S.A.		16,654		62,634
				708,855
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.		143,431		82,601
Sembcorp Marine Ltd.		68,096		221,464
Singapore Technologies Engineering Ltd.		77,000		235,185
United Engineers Ltd.		40,000		68,953
				608,203
Consumer Services 0.1%
Genting Singapore plc		91,000		96,424
Diversified Financials 0.1%
Singapore Exchange Ltd.		26,000		143,787
Energy 0.0%
Sakari Resources Ltd *(b)(c)		18,000		—
Food & Staples Retailing 0.1%
Olam International Ltd. (a)		106,704		190,405
Food, Beverage & Tobacco 0.1%
Golden Agri-Resources Ltd.		554,000		270,260
Real Estate 0.7%
Ascendas REIT		63,000		115,313
CapitaCommercial Trust		63,302		81,010
CapitaLand Ltd.		115,000		294,317
CapitaMall Trust		76,000		121,147
City Developments Ltd.		30,000		259,920
Global Logistic Properties Ltd.		33,000		75,210
Keppel Land Ltd.		31,000		85,760
Suntec Real Estate Investment Trust		63,000		86,351
UOL Group Ltd.		25,000		128,356
				1,247,384
Telecommunication Services 0.1%
M1 Ltd.		28,000		75,233
StarHub Ltd.		34,000		112,787
				188,020
Transportation 0.3%
Hutchison Port Holdings Trust, Class U		161,000		109,570
Neptune Orient Lines Ltd. *		209,000		169,514
SATS Ltd.		50,749		128,473
Singapore Post Ltd.		82,000		92,641
SMRT Corp., Ltd.		78,000		75,943
				576,141
				3,320,624
Spain 2.1%
Banks 0.2%
Bankinter S.A.		39,855		305,148
Caja de Ahorros del Mediterraneo *(b)(c)		5,382		—
				305,148
Capital Goods 0.7%
Abengoa S.A., B Shares		81,769		364,056
Construcciones y Auxiliar de Ferrocarriles S.A.		150		71,795
Elecnor S.A.		4,422		63,557
Gamesa Corp. Tecnologica S.A. *		38,595		383,627
Obrascon Huarte Lain S.A.		3,496		162,078
Sacyr S.A. *		21,125		139,138
Zardoya Otis S.A.		11,327		198,710
				1,382,961
Commercial & Professional Supplies 0.1%
Prosegur Cia de Seguridad S.A. - Reg’d		14,361		96,161
Diversified Financials 0.1%
Bolsas y Mercados Espanoles		4,480		195,173
Energy 0.1%
Tecnicas Reunidas S.A.		2,086		125,648
Food, Beverage & Tobacco 0.2%
Ebro Foods S.A.		7,896		181,943
Pescanova S.A. *(b)(c)		1,125		—
Viscofan S.A.		2,906		151,433
				333,376
Insurance 0.2%
Grupo Catalana Occidente S.A.		2,894		113,237
Mapfre S.A.		75,114		316,793
				430,030
Materials 0.2%
Acerinox S.A. (a)		19,613		342,966
Media 0.1%
Atresmedia Corp de Medios de Comunicaion S.A. *		5,414		77,902
Mediaset Espana Comunicacion S.A. *		18,896		209,680
				287,582
Pharmaceuticals, Biotechnology & Life Sciences 0.1%
Almirall S.A.		4,106		68,771
Grifols S.A.		2,077		111,031
Grifols S.A., Class B		1,631		67,022
				246,824
Software & Services 0.1%
Indra Sistemas S.A.		15,643		293,807
				4,039,676
Sweden 2.3%
Capital Goods 0.4%
Haldex AB		7,292		93,535
Indutrade AB		2,127		92,560
Lindab International AB *		6,639		82,767
Nibe Industrier AB, B Shares		3,492		98,049

See financial notes 45

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Peab AB		31,209		241,645
Saab AB, Class B		6,767		207,936
				816,492
Commercial & Professional Supplies 0.1%
Intrum Justitia AB		3,666		106,282
Loomis AB, Class B		6,351		173,238
				279,520
Consumer Durables & Apparel 0.2%
JM AB		7,686		261,170
Nobia AB		11,975		108,659
				369,829
Diversified Financials 0.2%
Lundbergforetagen AB, B Shares		2,683		125,340
Ratos AB, B Shares		30,650		312,678
				438,018
Energy 0.1%
Lundin Petroleum AB *		5,613		120,490
Food & Staples Retailing 0.1%
Axfood AB		2,229		118,508
Food, Beverage & Tobacco 0.0%
AarhusKarlshamn AB		1,180		79,017
Health Care Equipment & Services 0.1%
Elekta AB, B Shares		8,862		123,675
Materials 0.3%
BillerudKorsnas AB		10,738		156,928
Hexpol AB		905		85,748
Holmen AB, B Shares		7,188		254,046
				496,722
Media 0.2%
Eniro AB *		15,179		121,455
Modern Times Group AB, B Shares		4,660		207,916
				329,371
Pharmaceuticals, Biotechnology & Life Sciences 0.1%
Meda AB, A Shares		16,263		292,326
Real Estate 0.2%
Castellum AB		6,586		112,309
Fabege AB		7,852		110,304
Kungsleden AB		14,089		115,080
				337,693
Retailing 0.1%
Bilia AB, A Shares		3,486		115,747
Clas Ohlson AB, B Shares		3,710		82,288
KappAhl AB *		10,994		67,464
				265,499
Technology Hardware & Equipment 0.1%
Hexagon AB, B Shares		6,642		212,648
Transportation 0.1%
SAS AB *(a)		53,069		114,126
				4,393,934
Switzerland 3.1%
Banks 0.1%
Banque Cantonale Vaudoise - Reg’d *		161		95,568
Valiant Holding AG - Reg’d		1,124		124,456
				220,024
Capital Goods 0.8%
AFG Arbonia-Forster Holding AG - Reg’d *		2,423		80,774
Belimo Holding AG - Reg’d		20		56,266
Bucher Industries AG - Reg’d		393		128,010
Daetwyler Holding AG		493		77,951
Georg Fischer AG - Reg’d *		447		354,607
Implenia AG *		1,046		76,700
Meyer Burger Technology AG *		6,888		85,161
OC Oerlikon Corp. AG - Reg’d *		9,554		152,192
Rieter Holding AG - Reg’d *		414		93,614
Sulzer AG - Reg’d		1,910		294,717
Zehnder Group AG		1,548		67,542
				1,467,534
Commercial & Professional Supplies 0.2%
DKSH Holding Ltd.		1,425		117,599
Gategroup Holding AG *		4,761		148,347
Kaba Holding AG - Reg’d, Series B *		200		96,342
				362,288
Consumer Durables & Apparel 0.1%
Forbo Holding AG - Reg’d *		108		111,730
Consumer Services 0.1%
Kuoni Reisen Holding AG - Reg’d, Series B *		419		185,036
Diversified Financials 0.2%
Julius Baer Group Ltd. *		6,396		299,591
Partners Group Holding AG		413		113,087
				412,678
Food, Beverage & Tobacco 0.1%
Barry Callebaut AG - Reg’d *		106		144,059
Emmi AG - Reg’d *		287		105,308
				249,367
Health Care Equipment & Services 0.3%
Nobel Biocare Holding AG - Reg’d *		10,919		152,310
Sonova Holding AG - Reg’d *		1,590		229,699
Straumann Holding AG - Reg’d		407		90,318
				472,327
Insurance 0.1%
Helvetia Holding AG - Reg’d		409		203,865
Materials 0.1%
EMS-Chemie Holding AG - Reg’d		362		141,252
Schmolz & Bickenbach AG - Reg’d *		92,302		132,427
				273,679
Pharmaceuticals, Biotechnology & Life Sciences 0.3%
Actelion Ltd. - Reg’d *		3,343		329,130

46 See financial notes

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Galenica AG - Reg’d		229		233,186
				562,316
Real Estate 0.1%
Allreal Holding AG - Reg’d *		484		68,254
Swiss Prime Site AG - Reg’d *		1,749		147,023
				215,277
Retailing 0.2%
Dufry AG - Reg’d *		865		143,154
Valora Holding AG - Reg’d *		596		168,529
				311,683
Software & Services 0.0%
Temenos Group AG - Reg’d		2,324		83,327
Technology Hardware & Equipment 0.2%
Logitech International S.A. - Reg’d		21,097		286,132
Transportation 0.2%
Flughafen Zuerich AG - Reg’d		219		138,163
Panalpina Welttransport Holding AG - Reg’d		1,678		263,505
				401,668
				5,818,931
United Kingdom 12.7%
Banks 0.0%
Paragon Group Cos. plc		10,349		62,616
Capital Goods 1.5%
Ashtead Group plc		21,325		315,955
Bodycote plc		15,830		195,334
Chemring Group plc		27,706		104,785
Fenner plc		13,690		95,782
Galliford Try plc		8,906		179,272
Interserve plc		16,682		186,957
Keller Group plc		9,956		167,969
Kier Group plc		4,726		132,697
Lavendon Group plc		20,931		80,045
Melrose Industries plc		32,914		158,944
Morgan Advanced Materials plc		29,516		166,947
Morgan Sindall Group plc		10,699		143,159
QinetiQ Group plc		77,109		274,718
Rotork plc		2,963		129,946
Senior plc		22,166		107,127
Speedy Hire plc		93,252		88,789
Spirax-Sarco Engineering plc		3,473		170,251
Ultra Electronics Holdings plc		4,098		117,507
				2,816,184
Commercial & Professional Supplies 1.4%
Babcock International Group plc		15,162		306,029
Berendsen plc		17,683		309,027
Cape plc		21,129		107,137
De La Rue plc		16,445		227,881
Homeserve plc		24,878		141,922
Intertek Group plc		5,026		247,576
Mears Group plc		8,074		68,433
Michael Page International plc		30,144		239,429
Mitie Group plc		42,890		231,033
Rentokil Initial plc		145,432		293,039
RPS Group plc		22,263		111,346
Shanks Group plc		69,435		119,868
WS Atkins plc		6,588		142,883
				2,545,603
Consumer Durables & Apparel 0.4%
Bellway plc		10,764		262,133
Berkeley Group Holdings plc		4,106		159,320
Bovis Homes Group plc		7,203		96,325
Guinness Peat Group plc *		358,330		210,039
Redrow plc		13,902		67,271
				795,088
Consumer Services 0.8%
Betfair Group plc		5,771		94,222
Enterprise Inns plc *		132,548		305,974
Greene King plc		19,167		288,563
J.D. Wetherspoon plc		10,474		149,223
Marston’s plc		75,963		188,879
Mitchells & Butlers plc *		35,616		265,357
Spirit Pub Co. plc		59,188		78,447
The Restaurant Group plc		10,864		114,712
				1,485,377
Diversified Financials 1.6%
3i Group plc		14,973		96,178
Aberdeen Asset Management plc		29,676		219,497
Ashmore Group plc		17,355		103,086
Close Brothers Group plc		9,645		227,827
F&C Asset Management plc		48,543		97,860
Henderson Group plc		64,756		275,120
IG Group Holdings plc		20,190		217,115
Intermediate Capital Group plc		25,867		194,153
International Personal Finance		17,119		161,903
Investec plc		36,798		324,697
Jupiter Fund Management plc		16,206		106,493
London Stock Exchange Group plc		11,060		338,950
Provident Financial plc		9,281		312,047
Schroders plc		3,441		148,809
Schroders plc, Non Voting Shares		1,187		39,108
Tullett Prebon plc		25,257		135,759
				2,998,602
Energy 0.6%
Asia Resource Minerals plc *		25,937		82,876
EnQuest plc *		47,330		109,852
Hargreaves Services plc		4,004		55,435
Hunting plc		8,461		121,131
Petrofac Ltd.		12,567		308,299
Premier Oil plc		23,469		134,385
Subsea 7 S.A.		14,748		295,318
				1,107,296
Food & Staples Retailing 0.3%
Booker Group plc		119,586		297,480
Greggs plc		21,002		189,967
				487,447
Food, Beverage & Tobacco 0.3%
Britvic plc		11,224		137,466
Cranswick plc		6,691		135,132
Dairy Crest Group plc		23,987		187,149

See financial notes 47

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Greencore Group plc		30,656		135,400
				595,147
Health Care Equipment & Services 0.0%
Synergy Health plc		3,858		80,853
Household & Personal Products 0.1%
PZ Cussons plc		18,429		107,860
Insurance 0.9%
Admiral Group plc		11,450		270,398
Beazley plc		31,304		129,861
Catlin Group Ltd.		34,870		311,432
Direct Line Insurance Group plc		31,988		135,328
Hiscox Ltd.		24,063		286,833
Jardine Lloyd Thompson Group plc		6,714		119,807
Lancashire Holdings Ltd.		22,763		269,031
Phoenix Group Holdings		17,394		200,583
				1,723,273
Materials 1.1%
African Barrick Gold plc		23,057		96,725
Alent plc		16,164		86,786
Croda International plc		5,157		224,611
DS Smith plc		59,130		315,107
Elementis plc		22,135		103,910
Evraz plc *		159,146		259,564
Filtrona plc		9,235		125,264
Hill & Smith Holdings plc		8,388		79,232
Lonmin plc *		48,738		233,833
Petropavlovsk plc		86,095		99,091
Randgold Resources Ltd.		1,779		143,001
RPC Group plc		13,518		137,001
Synthomer plc		15,726		70,100
Victrex plc		3,128		98,486
				2,072,711
Media 0.3%
Cineworld Group plc		12,211		66,593
Trinity Mirror plc *		78,717		230,690
UBM plc		27,190		302,458
				599,741
Pharmaceuticals, Biotechnology & Life Sciences 0.1%
Genus plc		2,767		47,319
Hikma Pharmaceuticals plc		3,766		98,827
				146,146
Real Estate 0.6%
Derwent London plc		2,181		100,331
Hammerson plc		33,820		326,400
Intu Properties plc		39,918		197,203
Mapeley Ltd. *(b)(c)		2,199		—
Savills plc		10,606		107,443
Segro plc		48,728		288,397
Songbird Estates plc *		32,315		134,083
				1,153,857
Retailing 0.8%
Darty plc		128,646		222,093
Debenhams plc		189,729		257,678
Halfords Group plc		32,296		242,340
Howden Joinery Group plc		15,246		83,937
John Menzies plc		6,630		72,163
Lookers plc		42,769		100,734
Mothercare plc *		17,002		53,715
N Brown Group plc		9,738		84,400
Sports Direct International plc *		7,551		100,124
WH Smith plc		14,511		269,115
				1,486,299
Semiconductors & Semiconductor Equipment 0.1%
ARM Holdings plc		11,859		179,488
CSR plc		10,840		105,326
				284,814
Software & Services 0.3%
Aveva Group plc		1,745		62,218
Computacenter plc		16,684		183,672
Fidessa Group plc		1,950		73,815
Micro Focus International plc		7,924		103,919
Xchanging plc		31,225		83,990
				507,614
Technology Hardware & Equipment 0.7%
Domino Printing Sciences plc		6,982		91,453
Electrocomponents plc		51,122		252,001
Halma plc		16,322		155,071
Laird plc		37,296		175,283
Pace plc		19,931		122,815
Premier Farnell plc		33,406		125,675
Spectris plc		5,999		225,722
Spirent Communications plc		67,204		108,186
TT Electronics plc		25,758		91,111
				1,347,317
Telecommunication Services 0.1%
KCOM Group plc		46,711		74,307
TalkTalk Telecom Group plc		38,883		188,438
				262,745
Transportation 0.7%
BBA Aviation plc		40,061		210,175
easyJet plc		9,773		270,415
Go-Ahead Group plc		5,356		178,618
Northgate plc		30,682		268,578
Stagecoach Group plc		28,861		180,983
Stobart Group Ltd.		31,403		72,639
Stolt-Nielsen Ltd.		3,597		97,254
				1,278,662
				23,945,252
Total Common Stock
(Cost $150,662,376)				182,654,382
Preferred Stock 0.5% of net assets
Germany 0.4%
Automobiles & Components 0.2%
Porsche Automobil Holding SE		2,929		323,933
Capital Goods 0.1%
Jungheinrich AG		1,503		111,881
Health Care Equipment & Services 0.0%
Draegerwerk AG & Co. KGAA		413		48,877

48 See financial notes

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Materials 0.1%
Fuchs Petrolub SE		1,865		187,609
				672,300
Italy 0.1%
Insurance 0.1%
Fondiaria-Sai S.p.A. *		10,341		38,491
Unipol Gruppo Finanziario S.p.A.		35,833		236,841
				275,332
Total Preferred Stock
(Cost $597,623)				947,632
Rights 0.0% of net assets
Australia 0.0%
Banks 0.0%
Bank of Queensland Ltd. *(b)(c)		1,729		2,426
Materials 0.0%
Aquarius Platinum Ltd. *(a)		479,768		51,256
Total Rights
(Cost $27,110)				53,682
Other Investment Company 1.8% of net assets
United States 1.8%
iShares MSCI EAFE Small Cap ETF		65,000		3,381,300
Total Other Investment Company
(Cost $3,251,972)				3,381,300
Security	Face Amount		Value
Rate, Maturity Date	Local Currency		($)
Short-Term Investments 0.7% of net assets
Time Deposits 0.5%
Bank of Tokyo Mitsubishi
US Dollar
0.03%, 05/01/14		807,514		807,514
Brown Brothers Harriman
Canadian Dollar
0.24%, 05/01/14		20,872		19,043
Danish Krone
0.05%, 05/01/14		22,553		4,192
Hong Kong Dollar
0.01%, 05/01/14		19,688		2,539
Japanese Yen
0.01%, 05/01/14		380,677		3,724
Norwegian Krone
0.40%, 05/01/14		126,751		21,323
Pound Sterling
0.07%, 05/01/14		3,632		6,132
Singapore Dollar
0.01%, 05/01/14		3,299		2,631
Swedish Krona
0.13%, 05/01/14		75,460		11,605
Wells Fargo
Australian Dollar
1.50%, 05/01/14		19,627		18,233
Euro
0.05%, 05/01/14		28,471		39,500
				936,436
U.S. Treasury Obligation 0.2%
U.S. Treasury Bill
0.05%, 06/19/14 (d)(e)		300,000		299,980
Total Short-Term Investments
(Cost $1,236,416)				1,236,416
End of Investments.
	Number		Value
Security	of Shares		($)
Collateral Invested for Securities on Loan 2.6% of net assets
Wells Fargo Advantage Government Money Market Fund, Institutional Class 0.01% (f)		4,909,704		4,909,704
Total Collateral Invested for Securities on Loan
(Cost $4,909,704)				4,909,704
End of Collateral Invested for Securities on Loan.

At 04/30/14, the tax basis cost of the fund’s investments was $156,506,437 and the unrealized appreciation and depreciation were $36,954,228 and ($5,187,253), respectively, with a net unrealized appreciation of $31,766,975.

At 04/30/14, the values of certain foreign securities held by the fund aggregating $156,443,487 were adjusted from their closing market values in accordance with international fair valuation procedures approved by the fund’s Board of Trustees. (See financial 2(a) for additional information)

*	Non-income producing security.
(a)	All or a portion of this security is on loan. Securities on loan were valued at $4,646,231.
(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 $2,426 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.
(f)	The rate shown is the 7-day yield.

See financial notes 49

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

ADR —	American Depositary Receipt
CDI —	CHESS Depositary Interest
ETF —	Exchange traded fund
GDR —	Global Depositary Receipt
Reg’d —	Registered
REIT —	Real Estate Investment Trust
SDR —	Swedish Depositary Receipt

In addition to the above the fund held the following at 04/30/14:

			Contract		Unrealized
	Number of		Value		Appreciation
	Contracts		($)		($)
Futures Contracts
MSCI EAFE, e-mini, Long, expires 06/20/14		1		96,215		4,425

50 See financial notes

 Schwab Fundamental Emerging Markets Large Company Index Fund

Portfolio Holdings as of April 30, 2014 (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				($)		($)
	88	.9%	Common Stock		306,310,774		307,333,784
	10	.1%	Preferred Stock		43,133,333		34,812,965
	0	.0%	Rights		—		16
	0	.0%	Other Investment Company		3,762		4,133
	0	.7%	Short-Term Investments		2,427,242		2,427,242
	99	.7%	Total Investments		351,875,111		344,578,140
	0	.3%	Other Assets and Liabilities, Net				881,078
	100	.0%	Net Assets				345,459,218

	Number		Value
Security	of Shares		($)
Common Stock 88.9% of net assets
Brazil 5.8%
Banks 0.9%
Banco Bradesco S.A.		80,700		1,239,590
Banco do Brasil S.A.		145,700		1,529,695
Itau Unibanco Holding S.A.		31,707		488,456
				3,257,741
Capital Goods 0.2%
Embraer S.A.		65,999		570,674
Diversified Financials 0.1%
BM&F Bovespa S.A.		101,776		520,348
Energy 1.7%
Petroleo Brasileiro S.A. - Petrobras		715,900		5,018,283
Ultrapar Participacoes S.A.		41,600		1,044,408
				6,062,691
Food, Beverage & Tobacco 0.6%
AMBEV S.A.		102,878		752,062
BRF-Brasil Foods S.A.		30,045		680,468
JBS S.A.		167,236		577,516
				2,010,046
Materials 1.4%
Companhia Siderurgica Nacional S.A.		258,100		990,845
Usinas Siderurgicas de Minas Gerais S.A. *		48,439		174,009
Vale S.A.		274,500		3,619,374
				4,784,228
Software & Services 0.2%
Cielo S.A.		31,410		556,428
Telecommunication Services 0.2%
Oi S.A.		64,221		64,804
Tim Participacoes S.A.		106,485		577,854
				642,658
Utilities 0.5%
Centrais Eletricas Brasileiras S.A.		199,300		695,394
Companhia de Saneamento Basico do Estado de Sao Paulo		50,976		482,840
Companhia Energetica de Minas Gerais		21,280		163,483
CPFL Energia S.A.		58,644		497,346
				1,839,063
				20,243,877
Chile 0.8%
Energy 0.2%
Empresas Copec S.A.		44,200		578,226
Food & Staples Retailing 0.1%
Cencosud S.A.		133,330		443,122
Utilities 0.5%
Empresa Nacional de Electricidad S.A.		338,179		500,272
Enersis S.A.		4,099,400		1,327,126
				1,827,398
				2,848,746
China 12.6%
Automobiles & Components 0.1%
Dongfeng Motor Group Co., Ltd., Class H		334,000		446,518
Banks 4.7%
Agricultural Bank of China Ltd., Class H		1,947,600		819,512
Bank of China Ltd., Class H		8,733,234		3,847,847
Bank of Communications Co., Ltd., Class H		662,000		412,351
BOC Hong Kong (Holdings) Ltd.		212,000		622,045
China Construction Bank Corp., Class H		8,475,000		5,867,861
China Merchants Bank Co., Ltd., Class H		252,350		452,156
Industrial & Commercial Bank of China Ltd., Class H		6,886,172		4,114,609
				16,136,381
Capital Goods 0.3%
China Communications Construction Co., Ltd., Class H		792,000		519,611
China Railway Group Ltd., Class H		838,000		375,328
				894,939
Consumer Durables & Apparel 0.1%
Yue Yuen Industrial Holdings Ltd.		140,500		435,274

See financial notes 51

 Schwab Fundamental Emerging Markets Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Energy 3.6%
China Petroleum & Chemical Corp., Class H		5,588,400		4,961,136
China Shenhua Energy Co., Ltd., Class H		350,000		950,502
CNOOC Ltd.		1,633,000		2,699,101
PetroChina Co., Ltd., Class H		3,227,000		3,723,231
				12,333,970
Food & Staples Retailing 0.1%
China Resources Enterprise Ltd.		142,000		404,348
Insurance 0.6%
China Life Insurance Co., Ltd., Class H		396,000		1,030,215
China Pacific Insurance Group Co., Ltd., Class H		108,600		341,451
People’s Insurance Co., Group of China Ltd., Class H		927,000		356,090
Ping An Insurance (Group) Co. of China Ltd., Class H		68,000		504,705
				2,232,461
Materials 0.1%
China National Building Material Co., Ltd., Class H		380,000		360,480
Real Estate 0.1%
China Overseas Land & Investment Ltd.		166,000		408,639
Retailing 0.3%
Belle International Holdings Ltd.		344,000		357,699
GOME Electrical Appliances Holding Ltd.		2,999,000		566,188
				923,887
Technology Hardware & Equipment 0.2%
Lenovo Group Ltd.		452,000		515,078
Telecommunication Services 2.4%
China Mobile Ltd.		619,600		5,897,646
China Telecom Corp., Ltd., Class H		2,670,000		1,365,943
China Unicom (Hong Kong) Ltd.		769,056		1,178,990
				8,442,579
				43,534,554
Colombia 0.3%
Banks 0.1%
Bancolombia S.A.		17,219		236,513
Energy 0.2%
Ecopetrol S.A.		374,000		696,214
				932,727
Czech Republic 0.5%
Telecommunication Services 0.2%
Telefonica Czech Republic A/S		33,550		508,263
Utilities 0.3%
CEZ A/S		37,300		1,122,531
				1,630,794
Egypt 0.2%
Telecommunication Services 0.2%
Global Telecom Holding *		212,144		790,410
Greece 1.6%
Banks 0.7%
Alpha Bank A.E. *		915,100		886,410
National Bank of Greece S.A. *		173,900		679,853
Piraeus Bank S.A. *		365,800		863,280
				2,429,543
Consumer Services 0.4%
OPAP S.A.		99,400		1,587,422
Telecommunication Services 0.3%
Hellenic Telecommunications Organization S.A. *		60,700		969,727
Utilities 0.2%
Public Power Corp. S.A.		43,200		653,685
				5,640,377
Hungary 0.6%
Banks 0.2%
OTP Bank plc		38,100		727,559
Energy 0.3%
MOL Hungarian Oil & Gas plc		14,300		822,716
Telecommunication Services 0.1%
Magyar Telekom Telecommunications plc		321,348		458,460
				2,008,735
India 3.8%
Automobiles & Components 0.3%
Mahindra & Mahindra Ltd.		24,975		446,049
Tata Motors Ltd.		75,756		524,024
Tata Motors Ltd., Class A		11,785		44,291
				1,014,364
Banks 0.6%
Housing Development Finance Corp., Ltd.		47,600		709,696
ICICI Bank Ltd.		35,700		736,062
State Bank of India		19,100		659,548
				2,105,306
Energy 1.5%
Indian Oil Corp., Ltd.		101,687		444,338
Oil & Natural Gas Corp., Ltd.		276,800		1,494,178
Reliance Industries Ltd.		212,500		3,303,125
				5,241,641
Household & Personal Products 0.1%
Hindustan Unilever Ltd.		40,716		383,231
Materials 0.4%
Hindalco Industries Ltd.		276,100		615,996
Tata Steel Ltd.		111,200		740,253
				1,356,249

52 See financial notes

 Schwab Fundamental Emerging Markets Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Software & Services 0.6%
Infosys Ltd.		25,900		1,377,979
Tata Consultancy Services Ltd.		14,800		537,245
				1,915,224
Telecommunication Services 0.1%
Bharti Airtel Ltd.		88,785		483,488
Utilities 0.2%
NTPC Ltd.		266,633		514,541
				13,014,044
Indonesia 0.8%
Automobiles & Components 0.3%
PT Astra International Tbk		1,471,400		948,011
Banks 0.1%
PT Bank Rakyat Indonesia (Persero) Tbk		553,300		475,149
Energy 0.1%
PT Bumi Resources Tbk *		11,514,700		203,880
Telecommunication Services 0.3%
PT Telekomunikasi Indonesia (Persero) Tbk		5,522,600		1,085,470
				2,712,510
Malaysia 1.6%
Banks 0.6%
CIMB Group Holdings Berhad		249,900		575,667
Malayan Banking Berhad		204,400		620,457
Public Bank Berhad		125,800		776,577
				1,972,701
Capital Goods 0.2%
Sime Darby Berhad		266,900		772,084
Consumer Services 0.1%
Genting Berhad		164,900		495,643
Food, Beverage & Tobacco 0.1%
IOI Corp. Berhad		258,300		395,241
Telecommunication Services 0.4%
Axiata Group Berhad		312,200		643,922
Telekom Malaysia Berhad		298,200		566,663
				1,210,585
Utilities 0.2%
Tenaga Nasional Berhad		237,100		864,291
				5,710,545
Mexico 3.5%
Banks 0.4%
Grupo Financiero Banorte S.A.B. de C.V., Class O		70,400		466,705
Grupo Financiero Santander Mexico S.A.B. de C.V., Class B ADR		63,012		749,843
				1,216,548
Capital Goods 0.1%
Alfa S.A.B., Class A		179,200		471,876
Food & Staples Retailing 0.3%
Wal-Mart de Mexico S.A.B. de C.V., Series V		423,400		1,070,576
Food, Beverage & Tobacco 0.5%
Coca-Cola Femsa S.A.B. de C.V., Series L		34,500		385,380
Fomento Economico Mexicano S.A.B. de C.V.		108,100		986,494
Grupo Bimbo S.A.B. de C.V., Series A		155,000		428,175
				1,800,049
Materials 0.9%
Cemex S.A.B. de C.V., Series CPO *		1,752,965		2,241,662
Grupo Mexico S.A.B. de C.V., Series B		276,400		830,082
				3,071,744
Media 0.3%
Grupo Televisa S.A.B., Series CPO		172,800		1,133,530
Telecommunication Services 1.0%
America Movil S.A.B. de C.V., Series L		3,276,800		3,296,149
				12,060,472
Philippines 0.2%
Telecommunication Services 0.2%
Philippine Long Distance Telephone Co.		9,600		620,561
Poland 2.3%
Banks 0.4%
Bank Pekao S.A.		8,200		526,279
Powszechna Kasa Oszczednosci Bank Polski S.A.		67,300		923,584
				1,449,863
Energy 0.5%
Polski Koncern Naftowy Orlen S.A.		116,600		1,745,955
Insurance 0.2%
Powszechny Zaklad Ubezpieczen S.A.		4,700		666,700
Materials 0.4%
KGHM Polska Miedz S.A. *		39,400		1,426,592
Telecommunication Services 0.3%
Orange Polska S.A.		332,000		1,133,843
Utilities 0.5%
PGE S.A.		150,400		1,045,100
Tauron Polska Energia S.A.		347,382		615,396
				1,660,496
				8,083,449
Republic of Korea 18.9%
Automobiles & Components 2.1%
Hyundai Mobis		5,800		1,656,964

See financial notes 53

 Schwab Fundamental Emerging Markets Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Hyundai Motor Co.		17,500		3,901,913
Kia Motors Corp.		28,300		1,570,146
				7,129,023
Banks 1.3%
Hana Financial Group, Inc.		25,097		885,574
KB Financial Group, Inc.		29,900		1,022,843
Shinhan Financial Group Co., Ltd.		45,800		1,999,096
Woori Finance Holdings Co., Ltd. *(a)(b)		65,500		738,484
				4,645,997
Capital Goods 3.3%
Daelim Industrial Co., Ltd.		5,109		416,884
Daewoo Shipbuilding & Marine Engineering Co., Ltd.		13,560		393,549
Doosan Corp.		3,374		434,900
Doosan Heavy Industries & Construction Co., Ltd.		11,180		377,897
Hyundai Engineering & Construction Co., Ltd.		8,041		435,338
Hyundai Heavy Industries Co., Ltd.		8,100		1,522,914
LG Corp.		52,100		2,905,182
Samsung C&T Corp.		20,200		1,270,332
Samsung Heavy Industries Co., Ltd.		19,440		532,509
SK Holdings Co., Ltd.		12,600		2,234,990
SK Networks Co., Ltd. *		85,700		790,123
				11,314,618
Consumer Durables & Apparel 0.8%
LG Electronics, Inc.		41,400		2,757,487
Energy 1.1%
GS Holdings		24,085		1,123,903
S-Oil Corp.		10,953		641,002
SK Innovation Co., Ltd.		16,556		1,896,645
				3,661,550
Food & Staples Retailing 0.2%
E-Mart Co., Ltd.		2,300		525,932
Food, Beverage & Tobacco 0.3%
KT&G Corp.		12,100		969,593
Insurance 0.3%
Samsung Fire & Marine Insurance Co., Ltd.		3,100		736,345
Samsung Life Insurance Co., Ltd.		5,100		474,659
				1,211,004
Materials 2.5%
Cheil Industries, Inc.		6,330		404,225
Hanwha Corp.		24,000		699,576
Hyosung Corp.		6,236		445,519
Hyundai Steel Co.		10,700		701,110
LG Chem Ltd.		5,600		1,429,448
Lotte Chemical Corp.		2,500		395,756
POSCO		15,500		4,579,138
				8,654,772
Retailing 0.3%
Lotte Shopping Co., Ltd.		1,300		403,163
Shinsegae Co., Ltd.		2,548		553,195
				956,358
Semiconductors & Semiconductor Equipment 4.2%
Samsung Electronics Co., Ltd.		9,996		13,034,387
SK Hynix, Inc. *		39,150		1,526,594
				14,560,981
Software & Services 0.6%
NAVER Corp.		700		504,081
SK C&C Co., Ltd.		12,300		1,688,385
				2,192,466
Technology Hardware & Equipment 0.7%
LG Display Co., Ltd. *		63,000		1,677,923
Samsung Electro-Mechanics Co., Ltd.		6,100		392,055
Samsung SDI Co., Ltd.		3,580		525,710
				2,595,688
Telecommunication Services 0.6%
LG Uplus Corp.		56,190		553,406
SK Telecom Co., Ltd.		7,400		1,532,207
				2,085,613
Utilities 0.6%
Korea Electric Power Corp.		56,600		2,164,088
				65,425,170
Russia 12.7%
Banks 0.6%
Sberbank of Russia ADR		226,003		1,903,865
Energy 10.1%
Gazprom ADR		1,575,900		11,388,928
Gazprom OAO		414,000		1,495,907
LUKOIL ADR		223,800		11,847,843
LUKOIL OAO *		24,299		1,281,915
NovaTek OAO GDR Reg’d *		102,090		977,995
Rosneft Oil Co. GDR - Reg’d		213,200		1,340,409
Surgutneftegas ADR		687,500		4,875,239
Tatneft ADR		47,100		1,620,076
				34,828,312
Materials 1.0%
Mechel ADR *		118,300		238,966
Mining & Metallurgical Co. Norilsk Nickel OJSC ADR		145,700		2,634,135
Severstal GDR - Reg’d		58,510		413,597
Uralkali OJSC GDR - Reg’d		12,732		282,401
				3,569,099
Telecommunication Services 0.8%
Mobile TeleSystems ADR		69,851		1,170,703
Rostelecom OJSC ADR		46,369		603,980
Sistema JSFC *		1,088,800		1,134,238
				2,908,921
Utilities 0.2%
Federal Hydrogenerating Co., ADR		283,271		440,768
Russian Grids OAO *		18,504,001		218,588
				659,356
				43,869,553

54 See financial notes

 Schwab Fundamental Emerging Markets Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
South Africa 7.7%
Banks 0.9%
Barclays Africa Group Ltd		40,242		589,508
Nedbank Group Ltd.		24,329		521,538
Standard Bank Group Ltd.		138,100		1,814,489
				2,925,535
Capital Goods 0.7%
Aveng Ltd. *		247,645		532,092
Barloworld Ltd.		63,200		689,461
Bidvest Group Ltd.		47,000		1,290,518
				2,512,071
Consumer Durables & Apparel 0.2%
Steinhoff International Holdings Ltd.		156,600		813,747
Diversified Financials 0.4%
FirstRand Ltd.		273,100		1,004,841
Remgro Ltd.		20,700		416,858
				1,421,699
Energy 1.4%
Sasol Ltd.		84,500		4,735,744
Food & Staples Retailing 0.2%
Shoprite Holdings Ltd.		30,915		517,170
Food, Beverage & Tobacco 0.1%
Tiger Brands Ltd.		17,906		479,022
Insurance 0.2%
Sanlam Ltd.		152,500		816,964
Materials 1.5%
Anglo American Platinum Ltd. *		10,900		519,004
AngloGold Ashanti Ltd. *		43,700		789,971
ArcelorMittal South Africa Ltd. *		135,326		476,275
Gold Fields Ltd.		238,000		1,010,146
Impala Platinum Holdings Ltd.		121,700		1,371,958
Kumba Iron Ore Ltd.		15,254		543,268
Sappi Ltd. *		163,945		519,694
				5,230,316
Media 0.2%
Naspers Ltd., N Shares		7,600		718,194
Retailing 0.2%
Imperial Holdings Ltd.		33,300		621,065
Telecommunication Services 1.7%
MTN Group Ltd.		198,475		3,981,767
Telkom SA SOC Ltd. *		363,895		1,302,059
Vodacom Group Ltd.		36,801		439,189
				5,723,015
				26,514,542
Taiwan 12.5%
Banks 0.3%
CTBC Financial Holding Co., Ltd.		704,994		419,450
Mega Financial Holding Co., Ltd.		611,404		468,080
				887,530
Capital Goods 0.3%
Far Eastern New Century Corp.		577,137		591,366
Walsin Lihwa Corp. *		1,386,000		455,301
				1,046,667
Consumer Durables & Apparel 0.1%
Pou Chen Corp.		385,267		490,555
Diversified Financials 0.2%
Fubon Financial Holding Co., Ltd.		450,674		583,299
Energy 0.2%
Formosa Petrochemical Corp.		237,330		596,930
Food, Beverage & Tobacco 0.2%
Uni-President Enterprises Corp.		357,141		604,639
Insurance 0.1%
Cathay Financial Holding Co., Ltd.		339,142		479,542
Materials 2.1%
China Steel Corp.		1,900,489		1,597,001
Formosa Chemicals & Fibre Corp.		750,442		1,817,250
Formosa Plastics Corp.		642,732		1,658,494
Nan Ya Plastics Corp.		714,811		1,567,474
Taiwan Cement Corp.		381,299		605,860
				7,246,079
Semiconductors & Semiconductor Equipment 2.8%
Advanced Semiconductor Engineering, Inc.		619,094		720,912
MediaTek, Inc.		91,138		1,428,131
Siliconware Precision Industries Co.		496,270		735,357
Taiwan Semiconductor Manufacturing Co., Ltd.		1,492,689		5,865,305
United Microelectronics Corp.		2,411,965		1,051,653
				9,801,358
Technology Hardware & Equipment 5.5%
Acer, Inc. *		1,687,496		1,043,542
Asustek Computer, Inc.		204,041		2,109,586
AU Optronics Corp. *		4,429,800		1,684,061
Compal Electronics, Inc.		2,058,305		1,468,459
Delta Electronics, Inc.		135,025		829,010
Hon Hai Precision Industry Co., Ltd.		1,680,800		4,827,192
HTC Corp.		315,473		1,622,366
Innolux Corp. *		1,534,357		530,044
Inventec Corp.		737,639		680,166
Lite-On Technology Corp.		409,700		626,747
Pegatron Corp.		486,264		737,906
Quanta Computer, Inc.		415,500		1,140,040
Synnex Technology International Corp.		315,000		490,221
Wistron Corp.		891,222		744,709
WPG Holdings Ltd.		379,000		466,256
				19,000,305
Telecommunication Services 0.7%
Chunghwa Telecom Co., Ltd.		527,906		1,650,789
Far EasTone Telecommunications Co., Ltd.		187,622		405,674
Taiwan Mobile Co., Ltd.		134,600		434,470
				2,490,933
				43,227,837

See financial notes 55

 Schwab Fundamental Emerging Markets Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Thailand 1.1%
Energy 0.8%
PTT Exploration & Production PCL		116,000		571,755
PTT PCL		176,987		1,706,426
Thai Oil PCL		242,800		392,037
				2,670,218
Materials 0.1%
PTT Global Chemical PCL		251,500		479,917
Telecommunication Services 0.2%
Advanced Info Service PCL - Reg’d		76,475		571,908
				3,722,043
Turkey 1.4%
Banks 0.7%
Akbank T.A.S.		170,498		598,570
Turkiye Garanti Bankasi A/S		187,100		689,220
Turkiye Halk Bankasi A/S		66,525		447,288
Turkiye Is Bankasi, Class C		203,924		482,278
			��
				2,217,356
Capital Goods 0.2%
KOC Holding A/S		146,700		657,388
Diversified Financials 0.1%
Haci Omer Sabanci Holding A/S		107,285		454,202
Energy 0.2%
Tupras-Turkiye Petrol Rafinerileri A/S		32,700		739,767
Telecommunication Services 0.2%
Turkcell Iletisim Hizmetleri A/S *		115,423		674,125
				4,742,838
Total Common Stock
(Cost $306,310,774)				307,333,784
Preferred Stock 10.1% of net assets
Brazil 8.2%
Banks 2.3%
Banco Bradesco S.A.		173,000		2,575,118
Itau Unibanco Holding S.A.		296,200		4,888,512
Itausa - Investimentos Itau S.A.		134,566		591,433
				8,055,063
Energy 2.3%
Petroleo Brasileiro S.A.		1,066,900		7,928,482
Materials 2.3%
Bradespar S.A.		42,953		371,787
Gerdau S.A.		234,300		1,404,907
Metalurgica Gerdau S.A.		162,000		1,174,087
Usinas Siderurgicas de Minas Gerais S.A., Class A *		115,605		452,103
Vale S.A.		378,600		4,485,979
				7,888,863
Telecommunication Services 0.4%
Oi S.A.		289,332		277,686
Telefonica Brasil S.A.		49,200		1,033,536
				1,311,222
Utilities 0.9%
Centrais Eletricas Brasileiras S.A., Class B		161,000		910,510
Companhia Energetica de Minas Gerais		164,800		1,255,726
Companhia Paranaense de Energia-Copel		29,136		417,489
Eletropaulo Metropolitana S.A.		161,400		659,426
				3,243,151
				28,426,781
Colombia 0.1%
Banks 0.1%
Bancolombia S.A.		24,509		346,771
Republic of Korea 0.8%
Automobiles & Components 0.2%
Hyundai Motor Co.		2,500		315,362
Hyundai Motor Co., 2nd		3,667		514,786
				830,148
Consumer Durables & Apparel 0.1%
LG Electronics, Inc.		7,070		197,039
Materials 0.0%
LG Chem Ltd.		878		127,301
Semiconductors & Semiconductor Equipment 0.5%
Samsung Electronics Co., Ltd.		1,620		1,629,038
				2,783,526
Russia 1.0%
Energy 1.0%
AK Transneft OAO *		1,471		3,255,887
Total Preferred Stock
(Cost $43,133,333)				34,812,965
Rights 0.0% of net assets
Brazil 0.0%
Food, Beverage & Tobacco 0.0%
AMBEV S.A. *(a)(b)		144		16
Total Rights
(Cost $—)				16

56 See financial notes

 Schwab Fundamental Emerging Markets Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Other Investment Company 0.0% of net assets
United States 0.0%
iShares MSCI Emerging Markets ETF		100		4,133
Total Other Investment Company
(Cost $3,762)				4,133
Security	Face Amount		Value
Rate, Maturity Date	Local Currency		($)
Short-Term Investments 0.7% of net assets
Time Deposit 0.6%
DNB
0.03%, 05/01/14		2,242,251		2,242,251
U.S. Treasury Obligations 0.1%
U.S. Treasury Bills
0.02%, 06/19/14 (c)(d)		70,000		69,998
0.04%, 06/19/14 (c)(d)		25,000		24,999
0.05%, 06/19/14 (c)(d)		90,000		89,994
				184,991
Total Short-Term Investments
(Cost $2,427,242)				2,427,242
End of Investments.

At 04/30/14, the tax basis cost of the fund’s investments was $357,462,537 and the unrealized appreciation and depreciation were $34,629,856 and ($47,514,253), respectively, with a net unrealized depreciation of ($12,884,397).

At 04/30/14, the values of certain foreign securities held by the fund aggregating $260,440,952 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(a) for additional information)

*	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 $738,500 or 0.2% of net assets.
(c)	All or a portion of this security is held as collateral for open futures contracts.
(d)	The rate shown is the purchase yield.

ADR —	American Depositary Receipt
ETF —	Exchange traded fund
GDR —	Global Depositary Receipt
Reg’d —	Registered

In addition to the above, the fund held the following at 04/30/14:

			Contract		Unrealized
	Number of		Value		Appreciation
	Contracts		($)		($)
Futures Contracts
MSCI Emerging Markets, mini, Long, expires 06/20/14		55		2,734,875		17,673

See financial notes 57

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 12, 2014

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 12, 2014
By:	/s/ George Pereira
	George Pereira
	Principal Financial Officer
Date: June 12, 2014