FLTR vs SCHJ

FLTR—VanEck IG Floating Rate ETF

SCHJASchwab 1-5 Year Corporate Bond ETF

In short

FLTR One of the first corporate floating-rate note ETFs to list, back in April 2011. Coupons reset periodically, so rate sensitivity stays minimal, and its index can hold notes maturing anywhere from 6 months out to 30 years.

SCHJ Short-dated corporate credit at index-fund pricing. SCHJ tracks the Bloomberg US 1-5 Year Corporate Bond Index for 0.03% a year, sits at the bottom of its category's fee table, and pays monthly.

Stated mandate

FLTR The fund seeks to track the MVIS US Investment Grade Floating Rate Index before fees and expenses. The index comprises U.S.-dollar floating-rate notes from investment-grade corporate issuers.

SCHJ The fund seeks to track, before fees and expenses, the total return of an index measuring the short-term U.S. corporate bond market.

Why people hold it

• FLTR Floating coupons reset periodically, so the portfolio carries little interest-rate duration while staying in investment-grade corporate credit.vaneck.com
• Index rules run wide: USD notes from investment-grade corporate issuers, at least $300 million outstanding, 6 months to 30 years to maturity.marketvector.com
• 0.14% a year, a shade under the typical fee in its short-duration IG corporate group, spread across about 400 notes with monthly distributions.
• Has tracked its named index closely, and sits in the top quartile of its short-duration investment-grade corporate peer group.

• SCHJ 0.03% a year, against a 0.19% median for investment-grade corporate ETFs. No peer in the cohort charges less.
• Thousands of individual bonds in the basket, so no single issuer's trouble moves the fund much.
• The 1-5 year maturity ceiling means less price swing per move in rates than intermediate corporate funds like VCIT or IGIB, which sit further out the curve.
• Interest is passed through monthly rather than quarterly, and the fund ranks in the top quartile of its investment-grade corporate peer group overall.

Worth knowing

• FLTR Rate duration is near zero, credit risk is not: these are corporate notes, and floating-rate issuance skews toward banks and financial firms.marketvector.com
• Plain short-term corporate funds cost far less (VCSH at 0.03%, IGSB at 0.04%), though they take on the rate duration this one sheds.
• Income floats. Coupons reset with short-term rates, so the monthly payout moves up and down with them.vaneck.com

• SCHJ This is company debt, not Treasuries. Downgrades and defaults are part of the deal, and short maturities shrink that risk without erasing it.
• A mid-size fund with moderate trading volume, so spreads can run wider than at the category's giants. Limit orders matter more here.
• Launched in 2019, so its record is shorter than rivals that traded through earlier credit cycles.

Full FLTR profile⁠

Full SCHJ profile⁠