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Schwab
Funds®
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Summary
Prospectus April 30,
2011
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Schwab New Jersey
AMT Tax-Free Money
Fundtm
Ticker symbol: Sweep
Shares: SWJXX
Before you invest, you may want to review the funds
prospectus, which contains more information about the fund and
its risks. You can find the funds prospectus, Statement of
Additional Information (SAI) and other information about the
fund online at www.schwabfunds.com/prospectus. You can
also obtain this information at no cost by calling
1-866-414-6349
or by sending an email request to
orders@mysummaryprospectus.com. If you purchase or hold
fund shares through a financial intermediary, the funds
prospectus, SAI, and other information about the fund are
available from your financial intermediary.
The funds prospectus and SAI, both dated April 30,
2011, include a more detailed discussion of fund investment
policies and the risks associated with various fund investments.
The prospectus and SAI are incorporated by reference into the
summary prospectus, making them legally a part of the summary
prospectus.
Investment
objective
The funds goal is to seek the highest current income that
is consistent with stability of capital and liquidity, and is
exempt from federal and New Jersey gross income tax.
Fund fees
and expenses
This table describes the fees and expenses you may pay if you
buy and hold Sweep Shares of the fund.
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Shareholder
fees
(fees
paid directly from your investment)
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None
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Annual
fund operating expenses
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(expenses
that you pay each year as a % of the value of your investment)
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Management fees
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0.35
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Distribution (12b-1) fees
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None
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Other expenses
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0.38
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Total annual fund operating expenses
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0.73
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Less expense reduction
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(0.08)
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Total annual fund operating expenses after expense
reduction1
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0.65
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The investment
adviser and its affiliates have agreed to limit the total annual
fund operating expenses (excluding interest, taxes and certain
non-routine expenses) of the Sweep Shares to 0.65% for so long
as the investment adviser serves as the adviser to the fund.
This agreement may only be amended or terminated with the
approval of the funds Board of Trustees. Non-routine
expenses that are not subject to the foregoing contractual
operating expense limitation include, but are not limited to,
any reimbursement payments made by the Sweep Shares to the
investment adviser
and/or its
affiliates of fund fees and expenses that were previously waived
or reimbursed by the investment adviser
and/or its
affiliates in order to maintain a positive net yield for the
Sweep Shares.
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Example
This example is intended to help you compare the cost of
investing in the funds Sweep Shares with the cost of
investing in other mutual funds. The example assumes that you
invest $10,000 in the fund for the time periods indicated and
then redeem all of your shares at the end of those time periods.
The example also assumes that your investment has a 5% return
each year and that the Sweep Shares operating expenses
remain the same. The figures are based on total annual fund
operating expenses after expense reduction. The expenses would
be the same whether you stayed in the fund or sold your shares
at the end of each period. Your actual costs may be higher or
lower.
Expenses on
a $10,000 investment
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1 year
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3 years
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5 years
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10 years
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$66
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$208
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$362
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$810
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Principal
investment strategies
To pursue its goal, the fund invests in money market
securities from New Jersey issuers and from municipal agencies,
U.S. territories and possessions. These securities
may include general obligation issues, which typically are
backed by the issuers ability to levy taxes, and revenue
issues, which typically are backed by a stream of revenue from a
given source, such as a toll highway or a public water system.
These securities also may include municipal notes as well as
municipal leases, which municipalities may use to finance
construction or to acquire equipment. The fund may invest more
than 25% of its total assets in municipal securities financing
similar projects such as those relating to education, health
care, transportation, utilities, industrial development and
housing. Under normal circumstances, the fund will invest at
least 80% of its net assets in municipal money market securities
the interest from which is exempt from federal and New Jersey
gross income tax, including the federal alternative minimum tax
(AMT). The fund does not currently intend to invest
in any municipal securities whose interest is subject to AMT;
however, this would not prevent the fund from investing in such
securities as a temporary defensive measure discussed below.
The fund may purchase certain variable rate demand securities
issued by closed-end municipal bond funds, which, inturn, invest
primarily in portfolios of New Jersey tax-exempt municipal
bonds. It is anticipated that the interest on the variable rate
demand securities will be exempt from federal and New Jersey
gross income tax, including the AMT. These securities are
considered municipal money market securities for
purposes of the funds 80% investment policy stated above.
Many of the funds securities will be subject to credit or
liquidity enhancements from U.S. and/or non-U.S. entities, which
are designed to provide incremental levels of creditworthiness
or liquidity. Some municipal securities have been structured to
resemble variable- and floating-rate securities so that they
meet
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the requirements for being considered money market instruments.
In choosing securities, the funds manager seeks to
maximize current income within the limits of the funds
investment objective and credit, maturity and diversification
policies. Some of these policies may be stricter than the
federal regulations that apply to all money funds.
The investment advisers credit research department
analyzes and monitors the securities that the fund owns or is
considering buying. The manager may adjust the funds
holdings or its average maturity based on actual or anticipated
changes in interest rates or credit quality. To preserve its
investors capital, the fund seeks to maintain a stable
$1.00 share price.
During unusual market conditions, the fund may invest in taxable
money market securities and municipal securities whose interest
is subject to the AMT as a temporary defensive measure. When the
fund engages in such activities, it may not achieve its
investment goal.
Principal
risks
The fund is subject to risks, any of which could cause an
investor to lose money. The funds principal risks include:
Investment Risk. Your investment in the fund is not
a bank deposit and is not insured or guaranteed by the Federal
Deposit Insurance Corporation or any other government agency.
Although the fund seeks to preserve the value of your investment
at $1.00 per share, it is possible to lose money by investing in
the fund.
Interest Rate Risk. Interest rates rise and fall
over time. As with any investment whose yield reflects current
interest rates, the funds yield will change over time.
During periods when interest rates are low, the funds
yield (and total return) also will be low. In addition, to the
extent the Sweep Shares make any reimbursement payments to the
investment adviser and/or its affiliates, the Sweep
Sharess yield would be lower.
Credit Risk. The fund is subject to the risk that a
decline in the credit quality of a portfolio investment could
cause the fund to lose money or underperform. The fund could
lose money if the issuer of a portfolio investment fails to make
timely principal or interest payments or if a guarantor or
liquidity provider of a portfolio investment fails to honor its
obligations. For fixed rate investments, the negative
perceptions of the ability of an issuer, guarantor or liquidity
provider to make payments or otherwise honor its obligations, as
applicable, could also cause the price of that investment to
decline. The credit quality of the funds portfolio
holdings can change rapidly in certain market environments and
any downgrade or default on the part of a single portfolio
investment could cause the funds share price or yield to
fall. The funds investments in securities with credit or
liquidity enhancements provided by foreign entities may involve
certain risks that are greater than those associated with
investments in securities with credit or liquidity enhancements
provided by U.S. entities. These include risks of adverse
changes in foreign economic, political, regulatory and other
conditions; differing accounting, auditing, financial reporting
and legal standards and practices; differing securities market
structures; and higher transaction costs. In addition, sovereign
risk, or the risk that a government may become unwilling or
unable to meet its loan obligations or guarantees, could
increase the credit risk of financial institutions connected to
that particular country.
Management Risk. Any actively managed mutual fund is
subject to the risk that its investment adviser will make poor
security selections. The funds investment 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. The investment
advisers maturity decisions will also affect the
funds yield, and in unusual circumstances potentially
could affect its share price. To the extent that the investment
adviser anticipates interest rate trends imprecisely, the
funds yield at times could lag those of other money market
funds.
State Risk. The fund invests primarily in securities
issued by the state of New Jersey and its municipalities. Any
reduction in the credit ratings of obligations of these issuers
could adversely affect the market values and marketability of
such securities, and, consequently, the value of the funds
portfolio. Further, the funds share price and performance
could be affected by local, state and regional factors,
including erosion of the tax base and changes in the economic
climate. Certain New Jersey constitutional amendments,
legislative measures, executive orders and administrative
regulations could result in adverse consequences, affecting the
state of New Jersey
and/or its
municipalities. National governmental actions, such as
elimination of tax-exempt status, also could affect performance.
Investment Concentration Risk. To the extent that
the fund invests a substantial portion of its assets in
municipal securities financing similar projects, the fund may be
more sensitive to adverse economic, business or political
developments. A change that affects one project, such as
proposed legislation on the financing of the project, a shortage
of materials needed for the project, or a declining need for the
project, would likely affect all similar projects and the
overall municipal securities market.
Taxable Determinations Risk. Some of the funds
income could be taxable. If certain types of investments the
fund buys as tax-exempt are later ruled to be taxable, a portion
of the funds income could become taxable. This risk,
although generally considered low, is somewhat higher for
investments that have been structured as municipal money market
securities than for investments in other types of municipal
money market securities. Any defensive investments in taxable
securities or securities whose interest is subject to the AMT
could generate taxable income.
Liquidity Risk. Liquidity risk exists when
particular investments are difficult to purchase or sell. The
market for certain investments may become illiquid due to
specific adverse changes in the conditions of a particular
issuer or under adverse market or economic conditions
independent of the issuer. The funds investments in
illiquid securities may reduce the returns of the fund because
it may be unable to sell the illiquid securities at an
advantageous time or price. Further, transactions in illiquid
securities may entail transaction costs that are higher than
those for transactions in liquid securities.
Redemption Risk. The fund may experience
periods of heavy redemptions that could cause the fund to
liquidate its assets at
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Summary Prospectus April 30, 2011
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Schwab New Jersey AMT Tax-Free Money
Fundtm
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inopportune times or at a loss or depressed value, particularly
during periods of declining or illiquid markets. Redemptions by
a few large investors in the fund may have a significant adverse
effect on the funds ability to maintain a stable
$1.00 share price. In the event any money market fund fails
to maintain a stable net asset value, other money market funds,
including the fund, could face a market-wide risk of increased
redemption pressures, potentially jeopardizing the stability of
their $1.00 share prices.
Money Market Risk. The fund is not designed to offer
capital appreciation. In exchange for their emphasis on
stability and liquidity, money market investments may offer
lower long-term performance than stock or bond investments.
Performance
The bar chart below shows how the funds Sweep Shares
investment results have varied from year to year, and the
following table shows the funds Sweep Shares average
annual total returns for various periods. This information
provides some indication of the risks of investing in the fund.
All figures assume distributions were reinvested. Keep in mind
that future performance may differ from past performance. For
current performance information, please
seewww.schwab.com/moneyfunds or
call toll-free
1-800-435-4000
for a current
seven-day
yield.
Annual
total returns
(%) as of
12/31
Best
quarter: 0.77% Q2 2007 Worst
quarter: 0.00% Q3 2010
Average
annual total returns
(%) as of
12/31/10
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1 year
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5 years
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10 years
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Sweep Shares
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0.02%
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1.51%
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1.33%
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Investment
adviser
Charles Schwab Investment Management, Inc.
Purchase
and sale of fund shares
The fund is open for business each day that the New York Stock
Exchange is open except when the following federal holidays are
observed: Columbus Day and Veterans Day.
The Sweep Shares are designed for use in conjunction with
certain accounts held at Charles Schwab & Co., Inc.
(Schwab) and are subject to the eligibility terms and conditions
of your Schwab account agreement, as amended from time to time.
If you designate the fund as the sweep fund on your Schwab
account, your uninvested cash balances will be invested in the
fund according to the terms and conditions of your account
agreement. Similarly, when you use your account to purchase
other investments or make payments, shares of the fund will be
sold to cover these transactions according to the terms and
conditions of your account agreement. You may make purchase,
exchange and redemption requests in accordance with your account
agreement.
Tax
information
Distributions received from the fund are typically intended to
be exempt from federal and New Jersey gross income tax,
including the AMT. The fund may invest a portion of its assets
in securities that generate income that is not exempt from
federal and New Jersey gross income tax. Further, any of the
funds defensive investments in taxable securities and
securities whose interest is subject to the AMT could also
generate taxable income.
Payments
to financial intermediaries
The fund pays Schwab for shareholder and sweep administration
services. These payments may create a conflict of interest by
influencing Schwab and your salesperson to recommend the fund
over another investment. Ask your salesperson or visit
Schwabs website for more information.
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Summary Prospectus April 30, 2011
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Schwab New Jersey AMT Tax-Free Money
Fundtm
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Schwab
Funds®
REG54662FLD-04
Schwab
New Jersey AMT Tax-Free Money
Fundtm;
Ticker symbol: Sweep Shares: SWJXX
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Summary Prospectus April 30, 2011
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4 of 4
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Schwab New Jersey AMT Tax-Free Money
Fundtm
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