N-CSRS

Performance at a Glance

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value of an investment 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.csimfunds.com.

Total Return for the 6 Months Ended April 30, 2016
Schwab S&P 500 Index Fund (Ticker Symbol: SWPPX)	0.37%
S&P 500^® Index	0.43%
Fund Category: Morningstar Large Blend	-1.04%
Performance Details	page 8

Schwab 1000 Index Fund (Ticker Symbol: SNXFX)	-0.15%
Schwab 1000 Index^®	0.03%
Fund Category: Morningstar Large Blend	-1.04%
Performance Details	page 9

Schwab Small-Cap Index Fund (Ticker Symbol: SWSSX)	-1.86%
Russell 2000^® Index	-1.90%
Fund Category: Morningstar Small Blend	-1.06%
Performance Details	page 10

Schwab Total Stock Market Index Fund (Ticker Symbol: SWTSX)	0.02%
Dow Jones U.S. Total Stock Market Index^SM	0.03%
Fund Category: Morningstar Large Blend	-1.04%
Performance Details	page 11

Schwab International Index Fund¹ (Ticker Symbol: SWISX)	-3.36%
MSCI EAFE^® Index (Net)²	-3.07%
Fund Category: Morningstar Foreign Large Blend	-3.11%
Performance Details	pages 12-13

Minimum Initial Investment³	$ 100

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. Indexes are unmanaged and cannot be invested in directly. Performance results less than one year are not annualized. Performance data quoted does not reflect the non-recurring redemption fee of 2% that may be charged if shares are sold or exchanged within 30 days of the purchase date. If these fees were reflected, the performance data quoted would be lower.

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	The net version of the index reflects reinvested dividends net of withholding taxes, but reflects no deductions for expenses or other taxes.
³	Please see the funds' prospectus for further detail and eligibility requirements.

2Schwab 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,

The six-month reporting period ended April 30, 2016, was tumultuous for most equity markets as investors tried to assess whether slowing growth overseas would knock the U.S. recovery off course. The S&P 500^® Index dropped as much as 12% during the reporting period, only to end the six months in slightly positive territory. The Schwab Equity Index Funds were all generally aligned with their respective indices, though the volatile period proved challenging for most of these funds. While the Schwab S&P 500 Index Fund and the Schwab Total Stock Market Index Fund generated slightly positive returns, the Schwab International Index Fund and the Schwab 1000 Index Fund underperformed by comparison.

In the U.S., the Federal Reserve remained on hold through the first several months of 2016 after raising interest rates in December for the first time since 2006, as economic data remained sturdy but not strong enough to stoke inflation. Quarterly corporate profits fell in the fourth quarter for the first time since 2008 and the Great Recession, and projections for first-quarter earnings indicated more of the same. Overseas, better-than-estimated trade data suggested China’s economy may avoid a hard landing, but the leading credit rating agencies recently cut their respective outlooks for the country’s credit ratings due to slowing growth concerns. Meanwhile, fears of a recession in Japan and parts of Europe continue to weigh on stock prices in those markets.

Asset Class Performance Comparison % returns during the six months ended 4/30/2016

Index figures assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged and cannot be invested in directly. 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.

* The net version of the index reflects reinvested dividends net of withholding taxes, but reflects no deductions for expenses or other taxes.

Schwab Equity Index Funds3

From the President continued

At Charles Schwab Investment Management, our goal is to provide foundational products with consistent performance that enable investors to build diversified portfolios.

Dramatic moves in the market can prompt investors to question their strategy and second-guess their commitment to staying invested in stocks. But research shows that over virtually all periods of time, investors who take the long view—and stay invested in the market—have seen positive long-term results. Timing the market, trying to move in or out of investments based on predictions of where the market will move, is difficult for even the most seasoned professionals. And, moving in and out of the stock market means that you could miss out on some of the best days, which can exact a toll on returns.

One of the most important steps you can take to help manage the risk of volatile markets is to ensure your portfolio is diversified. At Charles Schwab Investment Management, our goal is to provide foundational products with consistent performance that enable investors to build diversified portfolios. We believe that the Schwab Equity Index Funds help fulfill this role by giving investors exposure to a varied selection of domestic and international stocks. These funds are designed to closely track the performance of stock market indexes constructed by industry-leading index providers, and are available at some of the lowest expense ratios in the industry.

Thank you for investing with Charles Schwab Investment Management, and for trusting us to help you achieve your financial goals. For more information about the Schwab Equity Index Funds, please continue reading this report or visit our website at www.csimfunds.com. We are also happy to hear from you at 1-877-824-5615.

Sincerely,

4Schwab Equity Index Funds

The Investment Environment

Over the six-month reporting period ended April 30, 2016, market volatility remained heightened in most equity markets. Diverging central bank policies, highly volatile oil and commodity prices, and lackluster global growth all contributed to market fluctuations, and added to investor uncertainty. The S&P 500^® Index, a bellwether for the overall U.S. stock market, returned 0.43%, while the Russell 2000^® Index, a U.S. small-cap company benchmark, returned -1.90%. Internationally, the MSCI EAFE Index (Net), a broad measure of developed international equity performance, returned -3.07%, and the MSCI Emerging Markets Index (Net) returned -0.13% for the six-month reporting period.

Contributing to increased market volatility over the reporting period was the uncertainty around U.S. short-term interest rate policy. Despite continued low inflation, the Federal Reserve (the Fed) raised the federal funds rate for the first time in almost ten years at its December 2015 meeting. The Fed cited strengthening economic indicators and expanding economic activity as support for this increase, and also stated that any subsequent increases would be measured and gradual. Initially, Fed officials estimated a total of four interest rate increases in 2016. As the reporting period continued, however, the likelihood of future short-term rate increases declined. U.S. stocks had one of the worst starts to a year, and concerns remained surrounding soft global economic growth. After the Fed left short-term interest rates unchanged in both March and April, projections from Fed officials were revised to two short-term interest rate increases in 2016. At the same time, however, federal funds futures were pricing in only one rate increase in 2016.

While the Fed began to slowly normalize monetary policy in the U.S., many other countries’ central banks maintained or increased accommodative policies to stimulate economic growth. The European Central Bank expanded its asset purchase program over the reporting period, while the Bank of Japan introduced sub-zero interest rates in February. However, with recession fears lingering in parts of Europe and in Japan, the weakening of the U.S. dollar against the euro and the Japanese yen in early 2016 added to the headwinds these regions faced. The People’s Bank of China (the PBOC) also implemented additional easing measures, including lowering the reserve requirement for banks which increased the funds available for banks to make loans. These policy moves highlighted the ongoing divergence between the Fed and central banks outside the U.S., and contributed to increased volatility in currencies, stocks, and fixed-income markets.

Economic turmoil in China remained a factor in market volatility. China’s economy continued to decelerate amidst slowing global demand, and uncertainty increased around the ability of the government and the PBOC to effectively manage the country’s financial situation. In January, the PBOC devalued the yuan for the second time in six months, triggering selloffs globally and sending oil prices downward. However, additional monetary easing measures appeared to be helping in some areas, as industrial output and retail sales in China both rose faster than expected in the month of March.

Schwab Equity Index Funds5

The Investment Environment continued

During the reporting period, sharp fluctuations in oil and commodity prices continued to add to market volatility and created extra pressure in credit markets. Overall demand for oil failed to keep pace with supply, resulting in excess reserves across the globe. In December, the Organization of the Petroleum Exporting Countries (OPEC) decided to maintain current production levels despite excess supply, causing oil prices to drop even further. Falling oil prices created stress in the high-yield corporate credit market and negatively affected many financial institutions as credit spreads widened and losses from loans to energy firms weighed on returns. The Fed’s dovish monetary policy and an agreement by several key OPEC members to limit supply helped oil to rally in February, and also supported a rebound in many global stocks. Despite additional price fluctuations toward the end of the reporting period, oil finished its best month of the year in April.

With diverging central bank policies, sharp oil price fluctuations, and continued weak global economic growth, the six-month reporting period saw heightened levels of volatility in both U.S. and international stock markets. Fed policy and a weaker U.S. dollar counteracted some accommodative policy measures in Europe and Japan, where recession fears lingered. The state of China’s economy remained a large factor in investor sentiment across the globe, though some signs of improvement emerged toward the end of the reporting period. Overall, U.S. and international equities were affected by many of the same factors, and were not immune to the impacts of an uncertain global economic environment.

Index figures assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged and cannot be invested in directly. Performance results less than one year are not annualized. Past performance is not an indication of future results.

For index definitions, please see the Glossary.

Management views may have changed since the report date.

6Schwab Equity Index Funds

Fund Management

Agnes Hong, CFA, Vice President and Head of Passive Equity Strategies, leads the portfolio management teams of Schwab's passive equity funds and ETFs, which comprise the Schwab Equity Index Funds, the Schwab Fundamental Index Funds, and the Schwab 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 more than 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.

David Rios, Portfolio Manager, is responsible for the day-to-day co-management of the Schwab S&P 500 Index Fund, Schwab 1000 Index Fund, and Schwab Small-Cap Index Fund. He joined CSIM in 2008 and became a Portfolio Manager in September 2014. Prior to this role, Mr. Rios served as an Associate Portfolio Manager on the Schwab Equity Index Strategies team for four years. His first role with CSIM was as a trade operation specialist. He also previously worked as a senior fund accountant at Investors Bank & Trust (subsequently acquired by State Street Corporation).

Schwab Equity Index Funds7

Schwab S&P 500 Index Fund

Performance and Fund Facts as of 04/30/16

Average Annual Total Returns^1,2,3

Fund and Inception Date	6 Months	1 Year	5 Years	10 Years
Fund: Schwab S&P 500 Index Fund (5/19/97)	0.37%	1.10%	10.92%	6.87%
S&P 500^® Index	0.43%	1.21%	11.02%	6.91%
Fund Category: Morningstar Large Blend	-1.04%	-1.97%	9.15%	5.94%

Fund Expense Ratio⁴: 0.09%

Statistics
Number of Holdings	507
Weighted Average Market Cap (millions)	$133,561
Price/Earnings Ratio (P/E)	23.9
Price/Book Ratio (P/B)	2.7
Portfolio Turnover Rate	1%

Sector Weightings % of Investments
Information Technology	19.6%
Financials	16.0%
Health Care	14.6%
Consumer Discretionary	12.9%
Consumer Staples	10.2%
Industrials	10.1%
Energy	7.3%
Utilities	3.3%
Materials	2.9%
Telecommunication Services	2.7%
Other	0.4%
Total	100.0%

Top Equity Holdings % of Net Assets⁵
Apple, Inc.	2.9%
Microsoft Corp.	2.2%
Exxon Mobil Corp.	2.0%
Johnson & Johnson	1.7%
General Electric Co.	1.6%
Berkshire Hathaway, Inc., Class B	1.5%
Facebook, Inc., Class A	1.5%
Amazon.com, Inc.	1.4%
AT&T, Inc.	1.3%
JPMorgan Chase & Co.	1.3%
Total	17.4%

For index definitions, please see the Glossary.

Index ownership – “Standard & Poor's^®,” “S&P^®,” and “S&P 500^®” are registered trademarks of Standard & Poor's Financial Services LLC (S&P), and have been licensed for use by S&P Dow Jones Indices LLC and its affiliates and sublicensed for certain purposes by Charles Schwab Investment Management, Inc. (CSIM). The “S&P 500^® Index” is a product of S&P Dow Jones Indices LLC or its affiliates, and has been licensed for use by CSIM. The Schwab S&P 500 Index Fund is not sponsored, endorsed, sold or promoted by S&P Dow Jones Indices LLC, Dow Jones, S&P, or their respective affiliates, and neither S&P Dow Jones Indices LLC, Dow Jones, S&P, nor their respective affiliates make any 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	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 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.
⁴	As stated in the prospectus. Reflects the total annual fund operating expenses without contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
⁵	This list is not a recommendation of any security by the investment adviser.

8Schwab Equity Index Funds

Schwab 1000 Index Fund

Performance and Fund Facts as of 04/30/16

Average Annual Total Returns^1,2,3

Fund and Inception Date	6 Months	1 Year	5 Years	10 Years
Fund: Schwab 1000 Index Fund (4/2/91)	-0.15%	-0.04%	10.38%	6.72%
Schwab 1000 Index^®	0.03%	0.29%	10.66%	7.03%
S&P 500^® Index	0.43%	1.21%	11.02%	6.91%
Fund Category: Morningstar Large Blend	-1.04%	-1.97%	9.15%	5.94%

Fund Expense Ratios⁴: Net 0.29%; Gross 0.33%

Statistics
Number of Holdings	988 ⁵
Weighted Average Market Cap (millions)	$119,498
Price/Earnings Ratio (P/E)	24.3
Price/Book Ratio (P/B)	2.7
Portfolio Turnover Rate	3%

Sector Weightings % of Investments
Information Technology	19.2%
Financials	17.0%
Health Care	14.2%
Consumer Discretionary	13.3%
Industrials	10.4%
Consumer Staples	9.4%
Energy	6.7%
Utilities	3.5%
Materials	3.1%
Telecommunication Services	2.5%
Other	0.7%
Total	100.0%

Top Equity Holdings % of Net Assets⁶
Apple, Inc.	2.5%
Microsoft Corp.	2.0%
Exxon Mobil Corp.	1.8%
Johnson & Johnson	1.5%
General Electric Co.	1.4%
Berkshire Hathaway, Inc., Class B	1.3%
Facebook, Inc., Class A	1.3%
Amazon.com, Inc.	1.2%
AT&T, Inc.	1.2%
JPMorgan Chase & Co.	1.1%
Total	15.3%

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 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.
⁴	As stated in the prospectus. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as the investment 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	As a result of the Schwab 1000 Index's once per year reconstitution and the effects of certain corporate actions, the fund may hold less than 1,000 securities.
⁶	This list is not a recommendation of any security by the investment adviser.

Schwab Equity Index Funds9

Schwab Small-Cap Index Fund

Performance and Fund Facts as of 04/30/16

Average Annual Total Returns^1,2,3

Fund and Inception Date	6 Months	1 Year	5 Years	10 Years
Fund: Schwab Small-Cap Index Fund (5/19/97)	-1.86%	-5.87%	7.30%	6.36%
Russell 2000^® Index	-1.90%	-5.94%	6.98%	5.42%
Small-Cap Spliced Index	-1.90%	-5.94%	7.24%	6.42%
Fund Category: Morningstar Small Blend	-1.06%	-5.31%	6.51%	5.22%

Fund Expense Ratios⁴: Net 0.17%; Gross 0.20%

Statistics
Number of Holdings	1,961
Weighted Average Market Cap (millions)	$1,897
Price/Earnings Ratio (P/E)	118.7
Price/Book Ratio (P/B)	1.9
Portfolio Turnover Rate	5%

Sector Weightings % of Investments
Financials	25.2%
Information Technology	16.6%
Health Care	13.5%
Consumer Discretionary	13.0%
Industrials	12.4%
Materials	4.0%
Utilities	3.8%
Consumer Staples	3.4%
Energy	2.8%
Telecommunication Services	0.9%
Other	4.4%
Total	100.0%

Top Equity Holdings % of Net Assets⁵
STERIS plc	0.4%
CubeSmart	0.3%
West Pharmaceutical Services, Inc.	0.3%
TreeHouse Foods, Inc.	0.3%
Tyler Technologies, Inc.	0.3%
Piedmont Natural Gas Co., Inc.	0.3%
Vail Resorts, Inc.	0.3%
MarketAxess Holdings, Inc.	0.3%
Manhattan Associates, Inc.	0.3%
Casey's General Stores, Inc.	0.3%
Total	3.1%

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	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 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.
⁴	As stated in the prospectus. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as the investment 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	This list is not a recommendation of any security by the investment adviser.

10Schwab Equity Index Funds

Schwab Total Stock Market Index Fund

Performance and Fund Facts as of 04/30/16

Average Annual Total Returns^1,2,3

Fund and Inception Date	6 Months	1 Year	5 Years	10 Years
Fund: Schwab Total Stock Market Index Fund (6/1/99)	0.02%	-0.27%	10.46%	7.00%
Dow Jones U.S. Total Stock Market Index^SM	0.03%	-0.28%	10.45%	6.95%
Fund Category: Morningstar Large Blend	-1.04%	-1.97%	9.15%	5.94%

Fund Expense Ratios⁴: Net 0.09%; Gross 0.11%

Statistics
Number of Holdings	2,460
Weighted Average Market Cap (millions)	$110,610
Price/Earnings Ratio (P/E)	27.1
Price/Book Ratio (P/B)	2.6
Portfolio Turnover Rate	0%

Sector Weightings % of Investments
Information Technology	18.8%
Financials	17.5%
Health Care	13.8%
Consumer Discretionary	13.3%
Industrials	10.7%
Consumer Staples	8.8%
Energy	6.6%
Utilities	3.3%
Materials	3.3%
Telecommunication Services	2.4%
Other	1.5%
Total	100.0%

Top Equity Holdings % of Net Assets⁵
Apple, Inc.	2.4%
Microsoft Corp.	1.8%
Exxon Mobil Corp.	1.6%
Johnson & Johnson	1.4%
General Electric Co.	1.3%
Berkshire Hathaway, Inc., Class B	1.2%
Facebook, Inc., Class A	1.2%
Amazon.com, Inc.	1.1%
AT&T, Inc.	1.1%
JPMorgan Chase & Co.	1.1%
Total	14.2%

For index definitions, please see the Glossary.

Index ownership – “Dow Jones^®” is a registered trademark of Dow Jones Trademark Holdings LLC (Dow Jones) and has been licensed for use by S& P Dow Jones Indices LLC and its affiliates and sublicensed for certain purposes by Charles Schwab Investment Management, Inc. (CSIM). The “Dow Jones U.S. Total Stock Market Index^SM” is a product of S&P Dow Jones Indices LLC or its affiliates, and has been licensed for use by CSIM. The Schwab Total Stock Market Index Fund is not sponsored, endorsed, sold or promoted by S&P Dow Jones Indices LLC, Dow Jones, S&P, or their respective affiliates, and neither S&P Dow Jones Indices LLC, Dow Jones, S&P, nor their respective affiliates make any 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	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 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.
⁴	As stated in the prospectus. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as the investment 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	This list is not a recommendation of any security by the investment adviser.

Schwab Equity Index Funds11

Schwab International Index Fund

Performance and Fund Facts as of 04/30/16

Average Annual Total Returns^1,2,3

Fund and Inception Date	6 Months	1 Year	5 Years	10 Years
Fund: Schwab International Index Fund (5/19/97)	-3.36%	-9.85%	1.38%	1.67%
MSCI EAFE^® Index (Net)⁴	-3.07%	-9.32%	1.69%	1.61%
International Spliced Index	-3.07%	-9.32%	1.73%	1.90%
Fund Category: Morningstar Foreign Large Blend	-3.11%	-9.96%	0.83%	1.27%

Fund Expense Ratios⁵: Net 0.19%; Gross 0.23%

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	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 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.
⁴	The net version of the index reflects reinvested dividends net of withholding taxes, but reflects no deductions for expenses or other taxes.
⁵	As stated in the prospectus. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as the investment 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.

12Schwab Equity Index Funds

Schwab International Index Fund

Performance and Fund Facts as of 04/30/16 continued

Statistics
Number of Holdings	935
Weighted Average Market Cap (millions)	$54,474
Price/Earnings Ratio (P/E)	21.4
Price/Book Ratio (P/B)	1.5
Portfolio Turnover Rate	1%

Sector Weightings % of Investments
Financials	23.5%
Industrials	13.0%
Consumer Discretionary	12.4%
Consumer Staples	12.2%
Health Care	11.4%
Materials	7.0%
Information Technology	5.0%
Telecommunication Services	5.0%
Energy	4.9%
Utilities	3.8%
Other	1.8%
Total	100.0%

Top Equity Holdings % of Net Assets¹
Nestle S.A. – Reg'd	1.9%
Roche Holding AG	1.5%
Novartis AG – Reg'd	1.4%
Toyota Motor Corp.	1.1%
HSBC Holdings plc	1.1%
British American Tobacco plc	0.9%
Total S.A.	0.9%
Novo Nordisk A/S, Class B	0.9%
Royal Dutch Shell plc, B Shares	0.9%
GlaxoSmithKline plc	0.9%
Total	11.5%

Country Weightings % of Investments

Japan	21.9%
United Kingdom	19.2%
France	9.8%
Switzerland	9.0%
Germany	8.9%
Australia	7.0%

Hong Kong	3.2%
Spain	3.2%
Netherlands	3.0%
Sweden	2.9%
Other Countries	11.9%
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	This list is not a recommendation of any security by the investment adviser.

Schwab Equity Index Funds13

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, 2015 and held through April 30, 2016.

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, or any non-routine expenses, such as proxy 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 or non-routine expenses were included, your costs would have been higher.

	Expense Ratio¹ (Annualized)	Beginning Account Value at 11/1/15	Ending Account Value (Net of Expenses) at 4/30/16	Expenses Paid During Period² 11/1/15–4/30/16
Schwab S&P 500 Index Fund
Actual Return	0.09%	$1,000.00	$ 1,003.70	$ 0.45
Hypothetical 5% Return	0.09%	$1,000.00	$ 1,024.45	$ 0.45
Schwab 1000 Index Fund
Actual Return	0.29%	$1,000.00	$ 998.50	$ 1.44
Hypothetical 5% Return	0.29%	$1,000.00	$1,023.46	$1.46
Schwab Small-Cap Index Fund
Actual Return	0.17%	$1,000.00	$ 981.40	$ 0.84
Hypothetical 5% Return	0.17%	$1,000.00	$ 1,024.05	$0.86
Schwab Total Stock Market Index Fund
Actual Return	0.09%	$1,000.00	$ 1,000.20	$ 0.45
Hypothetical 5% Return	0.09%	$1,000.00	$ 1,024.45	$ 0.45
Schwab International Index Fund
Actual Return	0.19%	$1,000.00	$ 966.40	$ 0.93
Hypothetical 5% Return	0.19%	$1,000.00	$1,023.96	$0.96

¹	Based on the most recent six-month expense ratio; may differ from the expense ratio provided in the Financial Highlights. This ratio does not include certain non-routine expenses, such as proxy expenses.
²	Expenses for each fund are equal to its annualized expense ratio, multiplied by the average account value over the period, multiplied by the 182 days of the period, and divided by the 366 days of the fiscal year.

14Schwab Equity Index Funds

Schwab S&P 500 Index Fund

Financial Statements

Financial Highlights

	11/1/15– 4/30/16*	11/1/14– 10/31/15	11/1/13– 10/31/14	11/1/12– 10/31/13	11/1/11– 10/31/12	11/1/10– 10/31/11
Per-Share Data
Net asset value at beginning of period	$33.00	$31.99	$27.78	$22.35	$19.82	$18.70
Income (loss) from investment operations:
Net investment income (loss)	0.35 ¹	0.67 ¹	0.56	0.52	0.44	0.39
Net realized and unrealized gains (losses)	(0.26)	0.92	4.13	5.40	2.49	1.09
Total from investment operations	0.09	1.59	4.69	5.92	2.93	1.48
Less distributions:
Distributions from net investment income	(0.68)	(0.58)	(0.48)	(0.49)	(0.40)	(0.36)
Distributions from net realized gains	(0.32)	—	—	—	—	—
Total distributions	(1.00)	(0.58)	(0.48)	(0.49)	(0.40)	(0.36)
Net asset value at end of period	$32.09	$33.00	$31.99	$27.78	$22.35	$19.82
Total return	0.37% ²	5.10%	17.16%	27.06%	15.09%	7.97%
Ratios/Supplemental Data
Ratios to average net assets:
Net operating expenses	0.09% ³	0.09%	0.09%	0.09%	0.09%	0.09%
Gross operating expenses	0.09% ³	0.09%	0.09%	0.09%	0.10%	0.10%
Net investment income (loss)	2.23% ³	2.07%	1.89%	2.10%	2.09%	1.96%
Portfolio turnover rate	1% ²	2%	2%	1%	2%	3%
Net assets, end of period (x 1,000,000)	$21,851	$21,587	$20,473	$17,121	$12,687	$10,909

*	Unaudited.

Calculated based on the average shares outstanding during the period.

Not annualized.

Annualized (except for proxy costs).

See financial notes 15

Schwab S&P 500 Index Fund

Condensed Portfolio Holdings as of April 30, 2016 (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-CSRS, is also available on the SEC's website at 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. The fund also makes available its complete schedule of portfolio holdings 15-20 days after calendar quarters on the fund's website at www.csimfunds.com/schwabfunds_prospectus.

Holdings by Category		Cost ($)	Value ($)
99.4%	Common Stock	12,817,510,420	21,727,499,807
0.1%	Other Investment Company	19,862,813	19,862,813
0.3%	Short-Term Investment	67,873,253	67,873,253
99.8%	Total Investments	12,905,246,486	21,815,235,873
0.2%	Other Assets and Liabilities, Net		35,560,587
100.0%	Net Assets		21,850,796,460

Security	Number of Shares	% of Net Assets	Value ($)
Common Stock 99.4% of net assets
Automobiles & Components 0.9%
Other Securities		0.9	203,941,972
Banks 5.6%
Bank of America Corp.	12,425,011	0.8	180,908,160
Citigroup, Inc.	3,554,447	0.8	164,499,807
JPMorgan Chase & Co.	4,426,531	1.3	279,756,759
Wells Fargo & Co.	5,568,709	1.3	278,324,076
Other Securities		1.4	308,779,258
		5.6	1,212,268,060
Capital Goods 7.3%
3M Co.	726,219	0.6	121,554,536
General Electric Co.	11,248,857	1.6	345,902,353
Honeywell International, Inc.	927,029	0.5	105,931,604
The Boeing Co.	753,454	0.5	101,565,599
United Technologies Corp.	937,858	0.4	97,884,239
Other Securities		3.7	819,325,877
		7.3	1,592,164,208
Commercial & Professional Supplies 0.7%
Other Securities		0.7	159,686,796

Security	Number of Shares	% of Net Assets	Value ($)
Consumer Durables & Apparel 1.5%
Other Securities		1.5	323,521,436
Consumer Services 1.8%
McDonald's Corp.	1,085,238	0.6	137,271,755
Starbucks Corp.	1,774,624	0.5	99,787,107
Other Securities		0.7	162,328,588
		1.8	399,387,450
Diversified Financials 4.9%
Berkshire Hathaway, Inc., Class B *	2,257,130	1.5	328,367,272
The Charles Schwab Corp. (a)	1,443,381	0.2	41,006,454
Other Securities		3.2	696,161,557
		4.9	1,065,535,283
Energy 7.3%
Chevron Corp.	2,272,934	1.1	232,248,396
Exxon Mobil Corp.	5,005,641	2.0	442,498,664
Schlumberger Ltd.	1,675,628	0.6	134,619,954
Other Securities		3.6	776,574,509
		7.3	1,585,941,523
Food & Staples Retailing 2.3%
CVS Health Corp.	1,320,351	0.6	132,695,275
Wal-Mart Stores, Inc.	1,886,902	0.6	126,177,137
Other Securities		1.1	243,157,342
		2.3	502,029,754
Food, Beverage & Tobacco 5.8%
Altria Group, Inc.	2,352,091	0.7	147,499,627
PepsiCo, Inc.	1,738,263	0.8	178,971,558
Philip Morris International, Inc.	1,862,946	0.8	182,792,261
The Coca-Cola Co.	4,689,756	1.0	210,101,069
Other Securities		2.5	548,795,560
		5.8	1,268,160,075
Health Care Equipment & Services 5.2%
Medtronic plc	1,690,376	0.6	133,793,260
UnitedHealth Group, Inc.	1,145,810	0.7	150,880,261
Other Securities		3.9	842,311,157
		5.2	1,126,984,678
Household & Personal Products 2.0%
The Procter & Gamble Co.	3,193,390	1.2	255,854,407
Other Securities		0.8	189,464,585
		2.0	445,318,992
Insurance 2.6%
Other Securities		2.6	571,424,984
Materials 2.9%
Other Securities		2.9	642,028,992

16 See financial notes

Schwab S&P 500 Index Fund

Condensed Portfolio Holdings (Unaudited) continued

Security	Number of Shares	% of Net Assets	Value ($)
Media 3.2%
Comcast Corp., Class A	2,935,764	0.8	178,377,021
The Walt Disney Co.	1,802,583	0.9	186,134,721
Other Securities		1.5	323,134,842
		3.2	687,646,584
Pharmaceuticals, Biotechnology & Life Sciences 9.4%
AbbVie, Inc.	1,935,886	0.5	118,089,046
Allergan plc *	475,068	0.5	102,880,726
Amgen, Inc.	907,759	0.7	143,698,250
Bristol-Myers Squibb Co.	2,007,664	0.7	144,913,188
Celgene Corp. *	942,726	0.4	97,487,296
Gilead Sciences, Inc.	1,642,750	0.7	144,906,977
Johnson & Johnson	3,321,025	1.7	372,220,482
Merck & Co., Inc.	3,333,114	0.8	182,787,972
Pfizer, Inc.	7,275,033	1.1	237,966,329
Other Securities		2.3	502,942,031
		9.4	2,047,892,297
Real Estate 2.9%
Other Securities		2.9	640,841,801
Retailing 5.5%
Amazon.com, Inc. *	464,980	1.4	306,696,158
The Home Depot, Inc.	1,527,150	0.9	204,470,113
Other Securities		3.2	696,939,519
		5.5	1,208,105,790
Semiconductors & Semiconductor Equipment 2.6%
Intel Corp.	5,695,905	0.8	172,472,003
Other Securities		1.8	402,864,082
		2.6	575,336,085
Software & Services 12.0%
Alphabet, Inc., Class A *	353,212	1.2	250,031,711
Alphabet, Inc., Class C *	358,675	1.1	248,565,362
Facebook, Inc., Class A *	2,763,700	1.5	324,955,846
International Business Machines Corp.	1,065,090	0.7	155,439,235
MasterCard, Inc., Class A	1,180,990	0.5	114,544,220
Microsoft Corp.	9,522,231	2.2	474,873,660
Oracle Corp.	3,803,386	0.7	151,602,966
Visa, Inc., Class A	2,306,800	0.8	178,177,232
Other Securities		3.3	720,124,904
		12.0	2,618,315,136
Technology Hardware & Equipment 4.9%
Apple, Inc.	6,678,015	2.9	625,997,126
Cisco Systems, Inc.	6,065,728	0.7	166,746,863
Other Securities		1.3	287,538,467
		4.9	1,080,282,456
Telecommunication Services 2.7%
AT&T, Inc.	7,407,702	1.3	287,566,992
Verizon Communications, Inc.	4,909,278	1.2	250,078,621
Other Securities		0.2	46,097,595
		2.7	583,743,208

Security	Number of Shares	% of Net Assets	Value ($)
Transportation 2.1%
Other Securities		2.1	458,876,546
Utilities 3.3%
Other Securities		3.3	728,065,701
Total Common Stock
(Cost $12,817,510,420)			21,727,499,807

Other Investment Company 0.1% of net assets
Securities Lending Collateral 0.1%
Other Securities		0.1	19,862,813
Total Other Investment Company
(Cost $19,862,813)			19,862,813
Security Rate, Maturity Date	Face Amount ($)	% of Net Assets	Value ($)
Short-Term Investment 0.3% of net assets
Time Deposit 0.3%
Other Securities		0.3	67,873,253
Total Short-Term Investment
(Cost $67,873,253)			67,873,253

End of Investments.

At 04/30/16, the tax basis cost of the fund's investments was $12,945,669,634 and the unrealized appreciation and depreciation were $9,560,260,855 and ($690,694,616), respectively, with a net unrealized appreciation of $8,869,566,239.

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 investment adviser.
(b)	All or a portion of this security is on loan. Securities on loan were valued at $19,632,857.
(c)	The rate shown is the 7-day yield.
(d)	The rate shown is the current daily overnight rate.

In addition to the above, the fund held the following at 04/30/16:

	Number of Contracts	Contract Value ($)	Unrealized Appreciation ($)
Futures Contracts
S&P 500 Index, e-mini, Long, expires 06/17/16	1,050	108,102,750	1,903,877

See financial notes 17

Schwab S&P 500 Index Fund

Statement of

Operations

For the period November 1, 2015 through April 30, 2016; unaudited

Investment Income
Dividends received from affiliated issuer		$170,752
Dividends received from unaffiliated issuers		242,273,589
Interest		81,713
Securities on loan	+	460,785
Total investment income		242,986,839
Expenses
Investment adviser and administrator fees		6,294,330
Shareholder service fees		1,982,660
Shareholder reports		253,997
Transfer agent fees		220,772
Portfolio accounting fees		204,666
Custodian fees		181,278
Proxy fees		180,211
Registration fees		82,700
Independent trustees' fees		62,476
Professional fees		57,180
Index fees		38,151
Other expenses	+	155,373
Total expenses		9,713,794
Expense reduction by CSIM and its affiliates	–	220,772
Net expenses	–	9,493,022
Net investment income		233,493,817
Realized and Unrealized Gains (Losses)
Net realized gains on unaffiliated issuers		91,532,526
Net realized gains on futures contracts	+	604,735
Net realized gains		92,137,261
Net change in unrealized appreciation (depreciation) on affiliated issuer		(2,818,948)
Net change in unrealized appreciation (depreciation) on unaffiliated issuers		(227,540,374)
Net change in unrealized appreciation (depreciation) on futures contracts	+	(3,561,223)
Net change in unrealized appreciation (depreciation)	+	(233,920,545)
Net realized and unrealized losses		(141,783,284)
Increase in net assets resulting from operations		$91,710,533

20 See financial notes

Schwab 1000 Index Fund

Financial Statements

Financial Highlights

	11/1/15– 4/30/16*	11/1/14– 10/31/15	11/1/13– 10/31/14	11/1/12– 10/31/13	11/1/11– 10/31/12	11/1/10– 10/31/11
Per-Share Data
Net asset value at beginning of period	$53.67	$53.63	$48.31	$40.23	$37.44	$35.79
Income (loss) from investment operations:
Net investment income (loss)¹	0.49	0.94	0.83	0.81	0.71	0.62
Net realized and unrealized gains (losses)	(0.65)	1.40	6.74	9.74	4.32	2.07
Total from investment operations	(0.16)	2.34	7.57	10.55	5.03	2.69
Less distributions:
Distributions from net investment income	(0.96)	(0.86)	(0.75)	(0.81)	(0.72)	(0.57)
Distributions from net realized gains	(2.18)	(1.44)	(1.50)	(1.66)	(1.52)	(0.47)
Total distributions	(3.14)	(2.30)	(2.25)	(2.47)	(2.24)	(1.04)
Net asset value at end of period	$50.37	$53.67	$53.63	$48.31	$40.23	$37.44
Total return	(0.15%) ²	4.66%	16.36%	27.85%	14.38%	7.60%
Ratios/Supplemental Data
Ratios to average net assets:
Net operating expenses	0.29% ³	0.29%	0.29%	0.29%	0.29%	0.29%
Gross operating expenses	0.33% ³	0.33%	0.33%	0.34%	0.34%	0.34%
Net investment income (loss)	1.98% ³	1.77%	1.64%	1.87%	1.85%	1.64%
Portfolio turnover rate	3% ²	4%	4%	4%	4%	5%
Net assets, end of period (x 1,000,000)	$6,380	$6,550	$6,586	$5,887	$4,848	$4,552

*	Unaudited.

Calculated based on the average shares outstanding during the period.

Not annualized.

Annualized (except for proxy costs).

22 See financial notes

Schwab 1000 Index Fund

Condensed Portfolio Holdings as of April 30, 2016 (Unaudited)

Holdings by Category		Cost ($)	Value ($)
99.5%	Common Stock	2,037,125,229	6,349,465,187
0.8%	Other Investment Companies	47,844,881	47,844,881
100.3%	Total Investments	2,084,970,110	6,397,310,068
(0.3%)	Other Assets and Liabilities, Net		(17,758,707)
100.0%	Net Assets		6,379,551,361

Security	Number of Shares	% of Net Assets	Value ($)
Common Stock 99.5% of net assets
Automobiles & Components 1.1%
Other Securities		1.1	69,933,398
Banks 5.5%
Bank of America Corp.	3,223,841	0.8	46,939,125
Citigroup, Inc.	922,256	0.7	42,682,008
JPMorgan Chase & Co.	1,145,078	1.1	72,368,930
Wells Fargo & Co.	1,444,496	1.1	72,195,910
Other Securities		1.8	113,604,951
		5.5	347,790,924
Capital Goods 7.5%
3M Co.	191,454	0.5	32,045,571
General Electric Co.	2,919,902	1.4	89,786,986
Honeywell International, Inc.	239,099	0.4	27,321,843
The Boeing Co.	193,989	0.4	26,149,717
United Technologies Corp.	244,203	0.4	25,487,467
Other Securities		4.4	276,832,993
		7.5	477,624,577
Commercial & Professional Supplies 0.9%
Other Securities		0.9	54,633,819
Consumer Durables & Apparel 1.6%
Other Securities		1.6	100,255,276

Security	Number of Shares	% of Net Assets	Value ($)
Consumer Services 2.2%
McDonald's Corp.	284,336	0.6	35,965,661
Starbucks Corp.	463,354	0.4	26,054,395
Other Securities		1.2	75,966,723
		2.2	137,986,779
Diversified Financials 4.7%
Berkshire Hathaway, Inc., Class B *	584,412	1.3	85,020,258
The Charles Schwab Corp. (a)	375,265	0.2	10,661,279
Other Securities		3.2	206,345,565
		4.7	302,027,102
Energy 6.7%
Chevron Corp.	588,537	0.9	60,136,711
Exxon Mobil Corp.	1,301,963	1.8	115,093,529
Schlumberger Ltd.	431,405	0.6	34,659,078
Other Securities		3.4	215,997,523
		6.7	425,886,841
Food & Staples Retailing 2.1%
CVS Health Corp.	342,511	0.5	34,422,356
Wal-Mart Stores, Inc.	491,627	0.5	32,875,097
Other Securities		1.1	68,237,526
		2.1	135,534,979
Food, Beverage & Tobacco 5.4%
Altria Group, Inc.	611,705	0.6	38,360,021
PepsiCo, Inc.	452,385	0.7	46,577,560
Philip Morris International, Inc.	484,865	0.7	47,574,954
The Coca-Cola Co.	1,216,648	0.9	54,505,830
Other Securities		2.5	159,920,423
		5.4	346,938,788
Health Care Equipment & Services 5.2%
Medtronic plc	438,922	0.6	34,740,676
UnitedHealth Group, Inc.	297,792	0.6	39,213,251
Other Securities		4.0	256,550,304
		5.2	330,504,231
Household & Personal Products 1.9%
The Procter & Gamble Co.	841,119	1.1	67,390,454
Other Securities		0.8	52,871,054
		1.9	120,261,508
Insurance 3.0%
Other Securities		3.0	190,482,554
Materials 3.1%
Other Securities		3.1	198,936,537
Media 3.3%
Comcast Corp., Class A	760,023	0.7	46,178,998
The Walt Disney Co.	470,260	0.8	48,559,048
Other Securities		1.8	115,565,655
		3.3	210,303,701

See financial notes 23

Schwab 1000 Index Fund

Condensed Portfolio Holdings (Unaudited) continued

Security	Number of Shares	% of Net Assets	Value ($)
Pharmaceuticals, Biotechnology & Life Sciences 9.0%
AbbVie, Inc.	505,126	0.5	30,812,686
Allergan plc *	123,377	0.4	26,718,523
Amgen, Inc.	235,202	0.6	37,232,477
Bristol-Myers Squibb Co.	521,839	0.6	37,666,339
Celgene Corp. *	245,440	0.4	25,380,950
Gilead Sciences, Inc.	426,544	0.6	37,625,446
Johnson & Johnson	861,087	1.5	96,510,631
Merck & Co., Inc.	863,818	0.7	47,371,779
Pfizer, Inc.	1,909,351	1.0	62,454,871
Other Securities		2.7	173,976,361
		9.0	575,750,063
Real Estate 3.9%
Other Securities		3.9	247,794,565
Retailing 5.2%
Amazon.com, Inc. *	120,441	1.2	79,441,679
The Home Depot, Inc.	396,635	0.8	53,105,460
Other Securities		3.2	201,775,608
		5.2	334,322,747
Semiconductors & Semiconductor Equipment 2.5%
Intel Corp.	1,472,780	0.7	44,595,778
Other Securities		1.8	117,079,599
		2.5	161,675,377
Software & Services 11.8%
Alphabet, Inc., Class A *	91,788	1.0	64,974,889
Alphabet, Inc., Class C *	93,332	1.0	64,680,009
Facebook, Inc., Class A *	716,300	1.3	84,222,554
International Business Machines Corp.	275,740	0.6	40,241,496
MasterCard, Inc., Class A	305,410	0.5	29,621,716
Microsoft Corp.	2,470,038	2.0	123,180,795
Oracle Corp.	988,410	0.6	39,398,023
Visa, Inc., Class A	601,900	0.7	46,490,756
Other Securities		4.1	263,267,327
		11.8	756,077,565
Technology Hardware & Equipment 4.8%
Apple, Inc.	1,730,874	2.5	162,252,129
Cisco Systems, Inc.	1,571,015	0.7	43,187,202
Other Securities		1.6	103,785,402
		4.8	309,224,733
Telecommunication Services 2.5%
AT&T, Inc.	1,921,041	1.2	74,574,812
Verizon Communications, Inc.	1,272,057	1.0	64,798,584
Other Securities		0.3	20,351,282
		2.5	159,724,678

Security	Number of Shares	% of Net Assets	Value ($)
Transportation 2.1%
Other Securities		2.1	133,442,822
Utilities 3.5%
Other Securities		3.5	222,351,623
Total Common Stock
(Cost $2,037,125,229)			6,349,465,187

Other Investment Companies 0.8% of net assets
Money Market Fund 0.4%
Other Securities		0.4	23,740,682
Securities Lending Collateral 0.4%
Other Securities		0.4	24,104,199
Total Other Investment Companies
(Cost $47,844,881)			47,844,881

End of Investments.

At 04/30/16, the tax basis cost of the fund's investments was $2,062,881,288 and the unrealized appreciation and depreciation were $4,388,381,454 and ($53,952,674), respectively, with a net unrealized appreciation of $4,334,428,780.

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 investment adviser.
(b)	All or a portion of this security is on loan. Securities on loan were valued at $23,395,197.
(c)	The rate shown is the 7-day yield.

REIT —

Real Estate Investment Trust

In addition to the above, the fund held the following at 04/30/16:

	Number of Contracts	Contract Value ($)	Unrealized Appreciation ($)
Futures Contracts
S&P 500 Index, e-mini, Long, expires 06/17/16	280	28,827,400	1,115,377

24 See financial notes

Schwab 1000 Index Fund

Statement of

Operations

For the period November 1, 2015 through April 30, 2016; unaudited

Investment Income
Dividends received from affiliated issuer		$45,032
Dividends received from unaffiliated issuers (net of foreign withholding taxes of $2,853)		70,362,264
Securities on loan	+	412,984
Total investment income		70,820,280
Expenses
Investment adviser and administrator fees		6,922,472
Shareholder service fees		3,000,611
Shareholder reports		108,023
Portfolio accounting fees		79,332
Proxy fees		70,781
Custodian fees		52,620
Transfer agent fees		41,848
Professional fees		35,088
Independent trustees' fees		32,133
Registration fees		18,839
Interest expense		620
Other expenses	+	41,854
Total expenses		10,404,221
Expense reduction by CSIM and its affiliates	–	1,304,690
Net expenses	–	9,099,531
Net investment income		61,720,749
Realized and Unrealized Gains (Losses)
Net realized gains on unaffiliated issuers		59,719,364
Net realized gains on futures contracts	+	3,696,218
Net realized gains		63,415,582
Net change in unrealized appreciation (depreciation) on affiliated underlying funds		(791,809)
Net change in unrealized appreciation (depreciation) on unaffiliated issuers		(135,555,974)
Net change in unrealized appreciation (depreciation) on futures contracts	+	(320,825)
Net change in unrealized appreciation (depreciation)	+	(136,668,608)
Net realized and unrealized losses		(73,253,026)
Decrease in net assets resulting from operations		($11,532,277)

See financial notes 27

Schwab Small-Cap Index Fund

Financial Statements

Financial Highlights

	11/1/15– 4/30/16*	11/1/14– 10/31/15	11/1/13– 10/31/14	11/1/12– 10/31/13	11/1/11– 10/31/12	11/1/10– 10/31/11
Per-Share Data
Net asset value at beginning of period	$26.29	$28.13	$27.62	$21.26	$20.55	$19.18
Income (loss) from investment operations:
Net investment income (loss)¹	0.22	0.38	0.35	0.42	0.33	0.25
Net realized and unrealized gains (losses)	(0.72)	(0.34)	1.76	6.94	1.89	1.37
Total from investment operations	(0.50)	0.04	2.11	7.36	2.22	1.62
Less distributions:
Distributions from net investment income	(0.36)	(0.34)	(0.31)	(0.50)	(0.35)	(0.20)
Distributions from net realized gains	(1.31)	(1.54)	(1.29)	(0.50)	(1.16)	(0.05)
Total distributions	(1.67)	(1.88)	(1.60)	(1.00)	(1.51)	(0.25)
Net asset value at end of period	$24.12	$26.29	$28.13	$27.62	$21.26	$20.55
Total return	(1.86%) ²	0.36%	8.08%	36.23%	11.87%	8.45%
Ratios/Supplemental Data
Ratios to average net assets:
Net operating expenses	0.17% ³	0.17%	0.17%	0.17%	0.17%	0.19%
Gross operating expenses	0.21% ³	0.20%	0.21%	0.20%	0.21%	0.19%
Net investment income (loss)	1.83% ³	1.37%	1.27%	1.76%	1.63%	1.18%
Portfolio turnover rate	5% ²	17%	12%	11%	41% ⁴	26%
Net assets, end of period (x 1,000,000)	$2,516	$2,607	$2,567	$2,351	$1,675	$1,502

*	Unaudited.

Calculated based on the average shares outstanding during the period.

Not annualized.

Annualized (except for proxy costs).

⁴

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 29

Schwab Small-Cap Index Fund

Condensed Portfolio Holdings as of April 30, 2016 (Unaudited)

Holdings by Category		Cost ($)	Value ($)
99.8%	Common Stock	1,981,827,802	2,510,738,263
0.0%	Rights	462,876	411,139
0.0%	Warrants	1,724	1,815
4.4%	Other Investment Company	109,377,623	109,377,623
0.2%	Short-Term Investment	5,599,652	5,599,652
104.4%	Total Investments	2,097,269,677	2,626,128,492
(4.4%)	Other Assets and Liabilities, Net		(110,097,791)
100.0%	Net Assets		2,516,030,701

Security	Number of Shares	% of Net Assets	Value ($)
Common Stock 99.8% of net assets
Automobiles & Components 1.1%
Other Securities		1.1	28,339,719
Banks 11.5%
FirstMerit Corp.	258,432	0.2	5,726,853
Investors Bancorp, Inc.	500,352	0.3	5,779,066
Prosperity Bancshares, Inc.	105,795	0.2	5,582,802
Umpqua Holdings Corp.	337,388	0.2	5,340,852
Webster Financial Corp.	138,927	0.2	5,090,285
Other Securities		10.4	261,257,800
		11.5	288,777,658
Capital Goods 7.8%
Curtiss-Wright Corp.	69,840	0.2	5,348,347
Teledyne Technologies, Inc. *	54,026	0.2	5,021,717
Woodward, Inc.	95,358	0.2	5,169,357
Other Securities		7.2	181,465,141
		7.8	197,004,562
Commercial & Professional Supplies 3.6%
Other Securities		3.6	90,291,573

Security	Number of Shares	% of Net Assets	Value ($)
Consumer Durables & Apparel 2.5%
Other Securities		2.5	63,015,361
Consumer Services 4.4%
Vail Resorts, Inc.	55,571	0.3	7,204,224
Other Securities		4.1	102,441,649
		4.4	109,645,873
Diversified Financials 2.1%
MarketAxess Holdings, Inc.	57,122	0.3	7,012,297
Other Securities		1.8	46,503,065
		2.1	53,515,362
Energy 2.9%
Other Securities		2.9	73,889,406
Food & Staples Retailing 0.8%
Casey's General Stores, Inc.	60,006	0.3	6,720,672
Other Securities		0.5	13,898,704
		0.8	20,619,376
Food, Beverage & Tobacco 2.3%
Post Holdings, Inc. *	91,699	0.3	6,587,656
TreeHouse Foods, Inc. *	84,952	0.3	7,509,757
Other Securities		1.7	43,928,429
		2.3	58,025,842
Health Care Equipment & Services 7.1%
ABIOMED, Inc. *	63,900	0.2	6,207,246
Amsurg Corp. *	82,753	0.3	6,701,338
HealthSouth Corp.	140,200	0.2	5,812,692
STERIS plc	127,127	0.4	8,984,065
WellCare Health Plans, Inc. *	66,506	0.2	5,984,875
West Pharmaceutical Services, Inc.	109,832	0.3	7,820,038
Other Securities		5.5	137,672,081
		7.1	179,182,335
Household & Personal Products 0.4%
Other Securities		0.4	10,299,230
Insurance 2.4%
CNO Financial Group, Inc.	289,168	0.2	5,312,016
First American Financial Corp.	160,800	0.3	5,792,016
Other Securities		1.9	48,302,314
		2.4	59,406,346
Materials 4.2%
Berry Plastics Group, Inc. *	180,657	0.3	6,507,265
Olin Corp.	254,848	0.2	5,553,138
Other Securities		3.7	93,806,747
		4.2	105,867,150
Media 1.6%
Other Securities		1.6	40,157,026

30 See financial notes

Schwab Small-Cap Index Fund

Condensed Portfolio Holdings (Unaudited) continued

Security	Number of Shares	% of Net Assets	Value ($)
Pharmaceuticals, Biotechnology & Life Sciences 7.0%
Neurocrine Biosciences, Inc. *	132,003	0.3	6,016,697
PAREXEL International Corp. *	84,980	0.2	5,192,278
Other Securities		6.5	163,653,477
		7.0	174,862,452
Real Estate 10.3%
CubeSmart	268,043	0.3	7,936,753
DCT Industrial Trust, Inc.	136,926	0.2	5,527,703
EPR Properties	87,200	0.2	5,744,736
Gramercy Property Trust	640,968	0.2	5,428,999
Highwoods Properties, Inc.	142,207	0.3	6,645,333
Sovran Self Storage, Inc.	58,617	0.3	6,226,298
Sun Communities, Inc.	85,536	0.2	5,805,328
Other Securities		8.6	216,526,321
		10.3	259,841,471
Retailing 3.9%
Burlington Stores, Inc. *	107,191	0.2	6,106,671
Pool Corp.	66,228	0.2	5,788,989
Other Securities		3.5	87,150,392
		3.9	99,046,052
Semiconductors & Semiconductor Equipment 3.1%
Microsemi Corp. *	168,044	0.2	5,678,207
Other Securities		2.9	72,885,426
		3.1	78,563,633
Software & Services 9.3%
EPAM Systems, Inc. *	73,883	0.2	5,388,287
Euronet Worldwide, Inc. *	77,882	0.3	6,004,702
Fair Isaac Corp.	47,541	0.2	5,073,100
Guidewire Software, Inc. *	105,027	0.2	5,983,388
Manhattan Associates, Inc. *	112,188	0.3	6,791,862
MAXIMUS, Inc.	101,917	0.2	5,391,409
Tyler Technologies, Inc. *	50,452	0.3	7,386,677
Other Securities		7.6	190,958,074
		9.3	232,977,499
Technology Hardware & Equipment 5.0%
FEI Co.	61,814	0.2	5,502,682
ViaSat, Inc. *	66,019	0.2	5,063,657
Other Securities		4.6	114,731,507
		5.0	125,297,846
Telecommunication Services 0.9%
Other Securities		0.9	22,452,041
Transportation 1.6%
Other Securities		1.6	38,799,719
Utilities 4.0%
IDACORP, Inc.	74,243	0.2	5,399,694
Piedmont Natural Gas Co., Inc.	122,206	0.3	7,307,919
Portland General Electric Co.	136,908	0.2	5,437,986

Security	Number of Shares	% of Net Assets	Value ($)
WGL Holdings, Inc.	76,233	0.2	5,175,458
Other Securities		3.1	77,539,674
		4.0	100,860,731
Total Common Stock
(Cost $1,981,827,802)			2,510,738,263

Rights 0.0% of net assets
Banks 0.0%
Other Securities		0.0	1,625
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
Other Securities		0.0	249,431
Telecommunication Services 0.0%
Other Securities		0.0	160,083
Total Rights
(Cost $462,876)			411,139

Warrants 0.0% of net assets
Energy 0.0%
Other Securities		0.0	—
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
Other Securities		0.0	1,815
Total Warrants
(Cost $1,724)			1,815

Other Investment Company 4.4% of net assets
Securities Lending Collateral 4.4%
Wells Fargo Advantage Government Money Market Fund, Select Class 0.23% (c)	109,377,623	4.4	109,377,623
Total Other Investment Company
(Cost $109,377,623)			109,377,623
Security Rate, Maturity Date	Face Amount ($)	% of Net Assets	Value ($)
Short-Term Investment 0.2% of net assets
Time Deposit 0.2%
Sumitomo Mitsui Banking Corp. 0.15%, 05/02/16 (e)	5,599,652	0.2	5,599,652
Total Short-Term Investment
(Cost $5,599,652)			5,599,652

End of Investments.

See financial notes 31

Schwab Small-Cap Index Fund

Condensed Portfolio Holdings (Unaudited) continued

At 04/30/16, tax basis cost of the fund's investments was $2,117,072,471 and the unrealized appreciation and depreciation were $783,580,204 and ($274,524,183), respectively, with a net unrealized appreciation of $509,056,021.

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

*	Non-income producing security.
(a)	Illiquid security. At the period end, the value of these amounted to $523,242 or 0.0% of net assets.
(b)	All or a portion of this security is on loan. Securities on loan were valued at $104,636,123.
(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)	The rate shown is the current daily overnight rate.

CVR —	Contingent Value Rights
REIT —	Real Estate Investment Trust

In addition to the above, the fund held the following at 04/30/16:

	Number of Contracts	Contract Value ($)	Unrealized Depreciation ($)
Futures Contracts
Russell 2000 Index, mini, Long, expires 06/17/16	35	3,946,600	(58,825)

The following is a summary of the inputs used to value the fund's investments as of April 30, 2016 (see financial note 2(a) for additional information):

Assets Valuation Input

Description	Quoted Prices in Active Markets for Identical Assets (Level 1)	Other Significant Observable Inputs (Level 2)	Significant Unobservable Inputs (Level 3)	Total
Common Stock¹	$2,250,896,792	$—	$—	$2,250,896,792
Real Estate	259,727,743	—	113,728	259,841,471
Rights ¹	—	—	411,139	411,139
Warrants ¹	1,815	—	—	1,815
Other Investment Company¹	109,377,623	—	—	109,377,623
Short-Term Investment¹	—	5,599,652	—	5,599,652
Total	$2,620,003,973	$5,599,652	$524,867	$2,626,128,492
Liabilities Valuation Input

Other Financial Instruments
Futures Contracts²	($58,825)	$—	$—	($58,825)

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

In the above table for significant unobservable inputs (Level 3), amounts include investments determined to have no value at April 30, 2016. See the Portfolio Holdings footnote in the complete schedule of Portfolio Holdings (Fair-valued by management in accordance with procedures approved by the Board of Trustees) for investment details.

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

Investments in Securities	Balance as of October 31, 2015	Realized Gains (Losses)	Change in Unrealized Appreciation (Depreciation)	Gross Purchases	Gross Sales	Gross Transfers in	Gross Transfers out	Balance as of April 30, 2016
Common Stock	$53,022	($158,396)	($538,465)	$—	($6,543)	$764,110	$—	$113,728
Rights	320,914	2,530	(51,737)	249,432	($110,000)	—	—	411,139
Total	$373,936	($155,866)	($590,202)	$249,432	($116,543)	$764,110	$—	$524,867

32 See financial notes

Schwab Small-Cap Index Fund

Statement of

Changes in Net Assets

For the current and prior report periods

Figures for the current period are unaudited

Operations
	11/1/15-4/30/16		11/1/14-10/31/15
Net investment income		$22,781,047	$36,385,637
Net realized gains (losses)		(14,196,154)	129,409,804
Net change in unrealized appreciation (depreciation)	+	(65,413,143)	(161,888,183)
Increase (decrease) in net assets from operations		(56,828,250)	3,907,258
Distributions to Shareholders
Distributions from net investment income		(36,921,658)	(31,478,925)
Distributions from net realized gains	+	(133,048,449)	(140,885,597)
Total distributions		($169,970,107)	($172,364,522)

Transactions in Fund Shares
		11/1/15-4/30/16		11/1/14-10/31/15
		SHARES	VALUE	SHARES	VALUE
Shares sold		13,408,564	$322,027,961	22,816,080	$620,636,969
Shares reinvested		6,229,806	148,954,660	6,143,892	156,607,812
Shares redeemed	+	(14,483,551)	(335,408,790)	(21,022,054)	(568,337,329)
Net transactions in fund shares		5,154,819	$135,573,831	7,937,918	$208,907,452
Shares Outstanding and Net Assets
		11/1/15-4/30/16		11/1/14-10/31/15
		SHARES	NET ASSETS	SHARES	NET ASSETS
Beginning of period		99,169,772	$2,607,255,227	91,231,854	$2,566,805,039
Total increase or decrease	+	5,154,819	(91,224,526)	7,937,918	40,450,188
End of period		104,324,591	$2,516,030,701	99,169,772	$2,607,255,227
Net investment income not yet distributed			$12,401,499		$26,542,110

36 See financial notes

Schwab Total Stock Market Index Fund

Financial Statements

Financial Highlights

	11/1/15– 4/30/16*	11/1/14– 10/31/15	11/1/13– 10/31/14	11/1/12– 10/31/13	11/1/11– 10/31/12	11/1/10– 10/31/11
Per-Share Data
Net asset value at beginning of period	$37.69	$36.96	$32.53	$25.80	$22.92	$21.57
Income (loss) from investment operations:
Net investment income (loss)	0.38 ¹	0.72 ¹	0.60	0.57	0.47	0.41
Net realized and unrealized gains (losses)	(0.41)	0.83	4.49	6.70	2.83	1.33
Total from investment operations	(0.03)	1.55	5.09	7.27	3.30	1.74
Less distributions:
Distributions from net investment income	(0.70)	(0.61)	(0.51)	(0.54)	(0.42)	(0.39)
Distributions from net realized gains	(0.30)	(0.21)	(0.15)	—	—	—
Total distributions	(1.00)	(0.82)	(0.66)	(0.54)	(0.42)	(0.39)
Net asset value at end of period	$36.66	$37.69	$36.96	$32.53	$25.80	$22.92
Total return	0.02% ²	4.36%	15.93%	28.76%	14.71%	8.14%
Ratios/Supplemental Data
Ratios to average net assets:
Net operating expenses	0.09% ³	0.09%	0.09%	0.09%	0.09%	0.09%
Gross operating expenses	0.11% ³	0.11%	0.10%	0.10%	0.10%	0.11%
Net investment income (loss)	2.16% ³	1.92%	1.79%	2.02%	2.02%	1.79%
Portfolio turnover rate	0% ²^,⁴	2%	1%	2%	3%	1%
Net assets, end of period (x 1,000,000)	$4,605	$4,477	$4,049	$3,183	$2,240	$1,747

*	Unaudited.

Calculated based on the average shares outstanding during the period.

Not annualized.

Annualized (except for proxy costs).

⁴

Less than 0.005%.

See financial notes 37

Schwab Total Stock Market Index Fund

Condensed Portfolio Holdings as of April 30, 2016 (Unaudited)

Holdings by Category		Cost ($)	Value ($)
99.0%	Common Stock	2,979,734,381	4,557,356,922
0.0%	Rights	67,393	58,980
0.0%	Warrants	—	—
0.6%	Other Investment Company	30,052,867	30,052,867
0.9%	Short-Term Investment	39,325,202	39,325,202
100.5%	Total Investments	3,049,179,843	4,626,793,971
(0.5%)	Other Assets and Liabilities, Net		(21,550,394)
100.0%	Net Assets		4,605,243,577

Security	Number of Shares	% of Net Assets	Value ($)
Common Stock 99.0% of net assets
Automobiles & Components 1.1%
Other Securities		1.1	50,048,088
Banks 5.8%
Bank of America Corp.	2,144,301	0.7	31,221,023
Citigroup, Inc.	614,589	0.6	28,443,179
JPMorgan Chase & Co.	759,563	1.1	48,004,382
Wells Fargo & Co.	959,513	1.0	47,956,460
Other Securities		2.4	110,969,168
		5.8	266,594,212
Capital Goods 7.6%
3M Co.	126,757	0.4	21,216,587
General Electric Co.	1,945,400	1.3	59,821,050
Honeywell International, Inc.	158,780	0.4	18,143,791
The Boeing Co.	129,036	0.4	17,394,053
Other Securities		5.1	233,080,806
		7.6	349,656,287
Commercial & Professional Supplies 1.1%
Other Securities		1.1	49,066,823

Security	Number of Shares	% of Net Assets	Value ($)
Consumer Durables & Apparel 1.6%
Other Securities		1.6	75,587,834
Consumer Services 2.3%
McDonald's Corp.	189,440	0.5	23,962,266
Starbucks Corp.	304,794	0.4	17,138,567
Other Securities		1.4	63,090,908
		2.3	104,191,741
Diversified Financials 4.6%
Berkshire Hathaway, Inc., Class B *	388,202	1.2	56,475,627
The Charles Schwab Corp. (a)	250,126	0.2	7,106,080
Other Securities		3.2	146,248,259
		4.6	209,829,966
Energy 6.6%
Chevron Corp.	389,323	0.9	39,781,024
Exxon Mobil Corp.	860,199	1.6	76,041,592
Schlumberger Ltd.	289,103	0.5	23,226,535
Other Securities		3.6	165,108,029
		6.6	304,157,180
Food & Staples Retailing 2.0%
CVS Health Corp.	227,637	0.5	22,877,519
Wal-Mart Stores, Inc.	321,789	0.5	21,518,030
Other Securities		1.0	47,154,363
		2.0	91,549,912
Food, Beverage & Tobacco 5.1%
Altria Group, Inc.	404,823	0.5	25,386,450
PepsiCo, Inc.	300,358	0.7	30,924,860
Philip Morris International, Inc.	318,909	0.7	31,291,351
The Coca-Cola Co.	806,414	0.8	36,127,347
Other Securities		2.4	111,201,917
		5.1	234,931,925
Health Care Equipment & Services 5.2%
Medtronic plc	292,388	0.5	23,142,510
UnitedHealth Group, Inc.	195,281	0.6	25,714,602
Other Securities		4.1	189,364,781
		5.2	238,221,893
Household & Personal Products 1.8%
The Procter & Gamble Co.	552,824	1.0	44,292,259
Other Securities		0.8	38,544,344
		1.8	82,836,603
Insurance 2.9%
Other Securities		2.9	133,951,232
Materials 3.3%
Other Securities		3.3	152,430,665

38 See financial notes

Schwab Total Stock Market Index Fund

Condensed Portfolio Holdings (Unaudited) continued

Security	Number of Shares	% of Net Assets	Value ($)
Media 3.2%
Comcast Corp., Class A	501,460	0.7	30,468,710
The Walt Disney Co.	311,839	0.7	32,200,495
Other Securities		1.8	85,159,107
		3.2	147,828,312
Pharmaceuticals, Biotechnology & Life Sciences 8.7%
AbbVie, Inc.	335,396	0.5	20,459,156
Allergan plc *	80,987	0.4	17,538,545
Amgen, Inc.	154,689	0.5	24,487,269
Bristol-Myers Squibb Co.	344,053	0.5	24,833,746
Gilead Sciences, Inc.	282,192	0.5	24,892,156
Johnson & Johnson	572,309	1.4	64,144,393
Merck & Co., Inc.	579,516	0.7	31,780,657
Pfizer, Inc.	1,275,025	0.9	41,706,068
Other Securities		3.3	152,816,270
		8.7	402,658,260
Real Estate 4.3%
Other Securities		4.3	199,574,538
Retailing 5.1%
Amazon.com, Inc. *	80,325	1.1	52,981,567
The Home Depot, Inc.	263,363	0.8	35,261,672
Other Securities		3.2	147,932,518
		5.1	236,175,757
Semiconductors & Semiconductor Equipment 2.5%
Intel Corp.	975,297	0.6	29,531,993
Other Securities		1.9	86,635,628
		2.5	116,167,621
Software & Services 11.5%
Alphabet, Inc., Class A *	60,876	0.9	43,092,903
Alphabet, Inc., Class C *	61,527	0.9	42,638,826
Facebook, Inc., Class A *	478,207	1.2	56,227,579
International Business Machines Corp.	183,251	0.6	26,743,651
MasterCard, Inc., Class A	202,156	0.4	19,607,110
Microsoft Corp.	1,646,518	1.8	82,111,853
Oracle Corp.	660,813	0.6	26,340,006
Visa, Inc., Class A	398,504	0.7	30,780,449
Other Securities		4.4	200,746,998
		11.5	528,289,375
Technology Hardware & Equipment 4.9%
Apple, Inc.	1,148,762	2.4	107,684,950
Cisco Systems, Inc.	1,049,640	0.6	28,854,604
Other Securities		1.9	87,113,726
		4.9	223,653,280
Telecommunication Services 2.4%
AT&T, Inc.	1,274,207	1.1	49,464,716
Verizon Communications, Inc.	843,169	0.9	42,951,029
Other Securities		0.4	17,693,716
		2.4	110,109,461

Security	Number of Shares	% of Net Assets	Value ($)
Transportation 2.0%
Other Securities		2.0	94,478,250
Utilities 3.4%
Other Securities		3.4	155,367,707
Total Common Stock
(Cost $2,979,734,381)			4,557,356,922

Rights 0.0% of net assets
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
Other Securities		0.0	34,410
Technology Hardware & Equipment 0.0%
Other Securities		0.0	—
Telecommunication Services 0.0%
Other Securities		0.0	24,570
Total Rights
(Cost $67,393)			58,980

Warrants 0.0% of net assets
Energy 0.0%
Other Securities		0.0	—
Total Warrants
(Cost $—)			—

Other Investment Company 0.6% of net assets
Securities Lending Collateral 0.6%
Wells Fargo Advantage Government Money Market Fund, Select Class 0.23% (d)	30,052,867	0.6	30,052,867
Total Other Investment Company
(Cost $30,052,867)			30,052,867
Security Rate, Maturity Date	Face Amount ($)	% of Net Assets	Value ($)
Short-Term Investment 0.9% of net assets
Time Deposit 0.9%
Sumitomo Mitsui Banking Corp. 0.15%, 05/02/16 (f)	39,325,202	0.9	39,325,202
Total Short-Term Investment
(Cost $39,325,202)			39,325,202

End of Investments.

See financial notes 39

Schwab Total Stock Market Index Fund

Condensed Portfolio Holdings (Unaudited) continued

At 04/30/16, the tax basis cost of the fund's investments was $3,070,083,081 and the unrealized appreciation and depreciation were $1,717,898,631 and ($161,187,741), respectively, with a net unrealized appreciation of $1,556,710,890.

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 investment adviser.
(b)	Illiquid security. At the period end, the value of these amounted to $58,980 or 0.0% of net assets.
(c)	All or a portion of this security is on loan. Securities on loan were valued at $29,045,840.
(d)	The rate shown is the 7-day yield.
(e)	Fair-valued by management in accordance with procedures approved by the Board of Trustees.
(f)	The rate shown is the current daily overnight rate.

CVR —	Contingent Value Rights
REIT —	Real Estate Investment Trust

In addition to the above, the fund held the following at 04/30/16:

	Number of Contracts	Contract Value ($)	Unrealized Appreciation ($)
Futures Contracts
Russell 2000 Index, mini, Long, expires 06/17/16	65	7,329,400	382,216
S&P 500 Index, e-mini, Long, expires 06/17/16	360	37,063,800	1,098,744
Net Unrealized Appreciation			1,480,960

The following is a summary of the inputs used to value the fund's investments as of April 30, 2016 (see financial note 2(a) for additional information):

Description	Quoted Prices in Active Markets for Identical Assets (Level 1)	Other Significant Observable Inputs (Level 2)	Significant Unobservable Inputs (Level 3)	Total
Common Stock¹	$4,557,356,922	$—	$—	$4,557,356,922
Rights ¹	—	—	58,980	58,980
Warrants ¹	—	—	—	—
Other Investment Company¹	30,052,867	—	—	30,052,867
Short-Term Investment¹	—	39,325,202	—	39,325,202
Total	$4,587,409,789	$39,325,202	$58,980	$4,626,793,971
Other Financial Instruments
Futures Contracts²	$1,480,960	$—	$—	$1,480,960

¹	As categorized in the complete schedule of Portfolio Holdings.
²	Futures contracts are not included in Investments in the schedule of Condensed 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:

Investments in Securities	Balance as of October 31, 2015	Realized Gains (Losses)	Change in Unrealized Appreciation (Depreciation)	Gross Purchases	Gross Sales	Gross Transfers in	Gross Transfers out	Balance as of April 30, 2016
Rights	$32,760	$—	($8,190)	$34,410	$—	$—	$—	$58,980
Total	$32,760	$—	($8,190)	$34,410	$—	$—	$—	$58,980

All net realized and change in unrealized gains (losses) in the table above are reflected on the accompanying Statement of Operations. The net change in unrealized appreciation (depreciation) for Level 3 investments held by the fund at April 30, 2016 was ($8,190).

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, 2016.

40 See financial notes

Schwab Total Stock Market Index Fund

Statement of

Assets and Liabilities

As of April 30, 2016; unaudited

Assets
Investment in affiliated issuer, at value (cost $5,313,111)		$7,106,080
Investments in unaffiliated issuers, at value (cost $3,013,813,865) including securities on loan of $29,045,840		4,589,635,024
Collateral invested for securities on loan, at value (cost $30,052,867)	+	30,052,867
Total investments, at value (cost $3,049,179,843)		4,626,793,971
Deposit with broker for futures contracts		2,810,250
Receivables:
Investments sold		31
Dividends		4,378,447
Fund shares sold		3,466,552
Income from securities on loan		116,457
Interest		328
Prepaid expenses	+	81,945
Total assets		4,637,647,981
Liabilities
Collateral held for securities on loan		30,052,867
Payables:
Investments bought		109,809
Investment adviser and administrator fees		34,575
Shareholder service fees		14,817
Fund shares redeemed		1,659,228
Variation margin on futures contracts		318,700
Due to custodian		31
Accrued expenses	+	214,377
Total liabilities		32,404,404
Net Assets
Total assets		4,637,647,981
Total liabilities	–	32,404,404
Net assets		$4,605,243,577
Net Assets by Source
Capital received from investors		2,999,912,518
Net investment income not yet distributed		32,079,032
Net realized capital losses		(5,843,061)
Net unrealized capital appreciation		1,579,095,088

Net Asset Value (NAV)
Net Assets	÷	Shares Outstanding	=	NAV
$4,605,243,577		125,632,722		$36.66

See financial notes 41

Schwab Total Stock Market Index Fund

Statement of

Operations

For the period November 1, 2015 through April 30, 2016; unaudited

Investment Income
Dividends received from affiliated issuer		$28,815
Dividends received from unaffiliated issuers (net of foreign withholding taxes of $3,111)		48,785,012
Interest		22,834
Securities on loan	+	658,807
Total investment income		49,495,468
Expenses
Investment adviser and administrator fees		1,317,230
Shareholder service fees		420,283
Index fees		205,914
Portfolio accounting fees		73,279
Shareholder reports		62,209
Proxy fees		56,480
Transfer agent fees		53,424
Custodian fees		42,249
Registration fees		36,447
Professional fees		26,475
Independent trustees' fees		16,072
Interest expense		21
Other expenses	+	33,285
Total expenses		2,343,368
Expense reduction by CSIM and its affiliates	–	311,023
Net expenses	–	2,032,345
Net investment income		47,463,123
Realized and Unrealized Gains (Losses)
Net realized gains on unaffiliated issuers		17,515,255
Net realized losses on futures contracts	+	(2,415,076)
Net realized gains		15,100,179
Net change in unrealized appreciation (depreciation) on affiliated issuer		(468,066)
Net change in unrealized appreciation (depreciation) on unaffiliated issuers		(57,337,566)
Net change in unrealized appreciation (depreciation) on futures contracts	+	380,004
Net change in unrealized appreciation (depreciation)	+	(57,425,628)
Net realized and unrealized losses		(42,325,449)
Increase in net assets resulting from operations		$5,137,674

42 See financial notes

Schwab International Index Fund

Financial Statements

Financial Highlights

	11/1/15– 4/30/16*	11/1/14– 10/31/15	11/1/13– 10/31/14	11/1/12– 10/31/13	11/1/11– 10/31/12	11/1/10– 10/31/11
Per-Share Data
Net asset value at beginning of period	$18.49	$19.42	$19.92	$16.32	$16.02	$17.31
Income (loss) from investment operations:
Net investment income (loss)	0.25 ¹	0.54 ¹	0.64	0.49	0.57	0.57
Net realized and unrealized gains (losses)	(0.88)	(0.86)	(0.63)	3.69	0.33	(1.38)
Total from investment operations	(0.63)	(0.32)	0.01	4.18	0.90	(0.81)
Less distributions:
Distributions from net investment income	(0.47)	(0.61)	(0.51)	(0.58)	(0.60)	(0.48)
Net asset value at end of period	$17.39	$18.49	$19.42	$19.92	$16.32	$16.02
Total return	(3.36%) ²	(1.53%)	0.09%	26.40%	6.07%	(4.83%)
Ratios/Supplemental Data
Ratios to average net assets:
Net operating expenses	0.19% ³	0.19%	0.19%	0.19%	0.19%	0.19%
Gross operating expenses	0.23% ³	0.23%	0.23%	0.23%	0.23%	0.21%
Net investment income (loss)	3.01% ³	2.82%	3.42%	2.88%	3.66%	3.26%
Portfolio turnover rate	1% ²	7%	2%	5%	31% ⁴	10%
Net assets, end of period (x 1,000,000)	$2,937	$2,844	$2,699	$2,205	$1,415	$1,375

*	Unaudited.

Calculated based on the average shares outstanding during the period.

Not annualized.

Annualized (except for proxy costs).

⁴

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

44 See financial notes

Schwab International Index Fund

Condensed Portfolio Holdings as of April 30, 2016 (Unaudited)

Holdings by Category		Cost ($)	Value ($)
98.4%	Common Stock	2,599,544,434	2,890,439,514
0.6%	Preferred Stock	17,300,936	17,060,236
1.4%	Other Investment Company	42,212,895	42,212,895
0.4%	Short-Term Investments	12,331,303	12,331,303
100.8%	Total Investments	2,671,389,568	2,962,043,948
(0.8%)	Other Assets and Liabilities, Net		(24,628,102)
100.0%	Net Assets		2,937,415,846

Security	Number of Shares	% of Net Assets	Value ($)
Common Stock 98.4% of net assets
Australia 7.1%
Australia & New Zealand Banking Group Ltd.	699,373	0.4	12,819,453
BHP Billiton Ltd.	769,972	0.4	12,024,605
Commonwealth Bank of Australia	410,716	0.8	22,929,047
National Australia Bank Ltd.	631,534	0.5	12,956,568
Westpac Banking Corp.	799,240	0.6	18,760,990
Other Securities		4.4	129,276,607
		7.1	208,767,270
Austria 0.2%
Other Securities		0.2	5,587,795
Belgium 1.4%
Anheuser-Busch InBev N.V.	193,359	0.8	23,986,933
Other Securities		0.6	17,716,939
		1.4	41,703,872
Denmark 2.0%
Novo Nordisk A/S, Class B	470,467	0.9	26,268,220
Other Securities		1.1	31,855,440
		2.0	58,123,660

Security	Number of Shares	% of Net Assets	Value ($)
Finland 0.9%
Other Securities		0.9	27,229,745
France 9.9%
AXA S.A.	472,949	0.4	11,941,773
BNP Paribas S.A.	254,171	0.5	13,460,626
Sanofi	282,340	0.8	23,272,319
TOTAL S.A.	529,033	0.9	26,737,750
Other Securities		7.3	215,707,509
		9.9	291,119,977
Germany 8.5%
Allianz SE - Reg'd	109,338	0.6	18,601,440
BASF SE	219,949	0.6	18,196,557
Bayer AG - Reg'd	198,571	0.8	22,948,229
Daimler AG - Reg'd	230,525	0.6	16,062,207
Deutsche Telekom AG - Reg'd	773,690	0.5	13,580,912
SAP SE	236,029	0.6	18,519,074
Siemens AG - Reg'd	190,197	0.7	19,903,779
Other Securities		4.1	121,266,353
		8.5	249,078,551
Hong Kong 3.2%
AIA Group Ltd.	2,892,000	0.6	17,307,465
Other Securities		2.6	77,657,114
		3.2	94,964,579
Ireland 0.5%
Other Securities		0.5	14,380,305
Israel 0.7%
Teva Pharmaceutical Industries Ltd.	219,589	0.4	12,062,686
Other Securities		0.3	8,261,443
		0.7	20,324,129
Italy 2.1%
Other Securities		2.1	61,891,886
Japan 22.1%
KDDI Corp.	419,400	0.4	12,081,125
Mitsubishi UFJ Financial Group, Inc.	3,059,409	0.5	14,118,598
SoftBank Group Corp.	230,700	0.4	12,404,853
Toyota Motor Corp.	649,603	1.1	32,928,184
Other Securities		19.7	576,519,382
		22.1	648,052,142
Netherlands 3.0%
ING Groep N.V. CVA	928,070	0.4	11,372,029
Unilever N.V. CVA	391,174	0.6	17,184,219
Other Securities		2.0	59,354,076
		3.0	87,910,324
New Zealand 0.2%
Other Securities		0.2	5,320,947

See financial notes 45

Schwab International Index Fund

Condensed Portfolio Holdings (Unaudited) continued

Security	Number of Shares	% of Net Assets	Value ($)
Norway 0.6%
Other Securities		0.6	17,826,483
Portugal 0.2%
Other Securities		0.2	4,949,442
Singapore 1.3%
Other Securities		1.3	38,756,608
Spain 3.2%
Banco Santander S.A.	3,459,966	0.6	17,570,812
Telefonica S.A.	1,085,760	0.4	11,877,339
Other Securities		2.2	65,296,108
		3.2	94,744,259
Sweden 2.9%
Other Securities		2.9	84,494,587
Switzerland 9.0%
Nestle S.A. - Reg'd	766,263	1.9	57,193,602
Novartis AG - Reg'd	546,624	1.4	41,599,293
Roche Holding AG	168,753	1.5	42,696,057
UBS Group AG - Reg’d	876,324	0.5	15,191,470
Other Securities		3.7	108,782,270
		9.0	265,462,692
United Kingdom 19.4%
AstraZeneca plc	303,330	0.6	17,402,831
BP plc	4,408,288	0.8	24,286,937
British American Tobacco plc	448,625	0.9	27,353,606
BT Group plc	2,032,491	0.4	13,174,747
Diageo plc	604,604	0.6	16,346,132
GlaxoSmithKline plc	1,168,011	0.9	24,963,277
HSBC Holdings plc	4,699,609	1.1	31,143,720
Imperial Brands plc	230,021	0.4	12,506,980
Lloyds Banking Group plc	13,699,335	0.5	13,446,043
National Grid plc	897,242	0.4	12,802,396
Prudential plc	616,272	0.4	12,164,919
Reckitt Benckiser Group plc	152,618	0.5	14,867,884
Royal Dutch Shell plc, A Shares	947,722	0.8	24,823,871
Royal Dutch Shell plc, B Shares	952,433	0.9	25,006,006
SABMiller plc	232,508	0.5	14,240,191
Unilever plc	307,724	0.5	13,749,683
Vodafone Group plc	6,372,661	0.7	20,531,680
Other Securities		8.5	250,939,358
		19.4	569,750,261
Total Common Stock
(Cost $2,599,544,434)			2,890,439,514

Preferred Stock 0.6% of net assets
Germany 0.5%
Other Securities		0.5	15,301,285
Italy 0.1%
Other Securities		0.1	1,712,948

Security	Number of Shares	% of Net Assets	Value ($)
United Kingdom 0.0%
Other Securities		0.0	46,003
Total Preferred Stock
(Cost $17,300,936)			17,060,236

Other Investment Company 1.4% of net assets
United States 1.4%
Securities Lending Collateral 1.4%
Wells Fargo Advantage Government Money Market Fund, Select Class 0.23% (c)	42,212,895	1.4	42,212,895
Total Other Investment Company
(Cost $42,212,895)			42,212,895
Security Rate, Maturity Date	Face Amount ($)	% of Net Assets	Value ($)
Short-Term Investments 0.4% of net assets
Time Deposit 0.4%
Other Securities		0.4	12,331,303
Total Short-Term Investments
(Cost $12,331,303)			12,331,303

End of Investments.

At 04/30/16, the tax basis cost of the fund's investments was $2,689,597,663 and the unrealized appreciation and depreciation were $542,042,121 and ($269,595,836), respectively, with a net unrealized appreciation of $272,446,285.

At 04/30/16, the values of certain foreign securities held by the fund aggregating $2,881,680,025 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 $39,697,005.
(b)	Illiquid security. At the period end, the value of these amounted to $46,003 or 0.0% of net assets.
(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)	Securities exempt from registration under Rule 144A of the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registrations, normally to qualified institutional buyers. At the period end, the value of these amounted to $8,052,660 or 0.3% of net assets.
(f)	The rate shown is the current daily overnight rate.

46 See financial notes

Schwab International Index Fund

Condensed Portfolio Holdings (Unaudited) continued

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

In addition to the above, the fund held the following at 04/30/16:

	Number of Contracts	Contract Value ($)	Unrealized Appreciation ($)
Futures Contracts
MSCI EAFE, e-mini, Long, expires 06/17/16	140	11,633,300	180,796

The following is a summary of the inputs used to value the fund's investments as of April 30, 2016 (see financial note 2(a) for additional information):

Description	Quoted Prices in Active Markets for Identical Assets (Level 1)	Other Significant Observable Inputs (Level 2)	Significant Unobservable Inputs (Level 3)	Total
Common Stock¹	$—	$2,039,188,340	$—	$2,039,188,340
Hong Kong	1,285,039	93,679,540	—	94,964,579
Israel	2,369,606	17,954,523	—	20,324,129
Japan	1,333,974	646,718,168	—	648,052,142
Netherlands	20,785,103	67,125,221	—	87,910,324
Preferred Stock¹	—	17,014,233	—	17,014,233
United Kingdom	—	—	46,003	46,003
Other Investment Company¹	42,212,895	—	—	42,212,895
Short-Term Investments¹	—	12,331,303	—	12,331,303
Total	$67,986,617	$2,894,011,328	$46,003	$2,962,043,948
Other Financial Instruments
Futures Contracts²	$180,796	$—	$—	$180,796

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

See financial notes 47

Schwab International Index Fund

Condensed Portfolio Holdings (Unaudited) continued

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

Investments in Securities	Balance as of October 31, 2015	Realized Gains (Losses)	Change in Unrealized Appreciation (Depreciation)	Gross Purchases	Gross Sales	Gross Transfers in	Gross Transfers out	Balance as of April 30, 2016
Common Stock
Australia	$1,513,552	$—	$74,147	$—	($1,587,699)	$—	$—	$—
Preferred Stock
Ireland	14,460	(235)	60	—	(14,285)	—	—	—
United Kingdom	58,962	(1,289)	259	45,754	(57,683)	—	—	46,003
Total	$1,586,974	($1,524)	$74,466	$45,754	($1,659,667)	$—	$—	$46,003

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 $16,901,525 from Level 1 to Level 2 for the period ended April 30, 2016. 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 from Level 2 to Level 1 and no transfers in or out of Level 3 during the period.

48 See financial notes

Schwab International Index Fund

Statement of

Operations

For the period November 1, 2015 through April 30, 2016; unaudited

Investment Income
Dividends (net of foreign withholding tax of $4,451,471)		$44,333,867
Interest		16,715
Securities on loan	+	804,531
Total investment income		45,155,113
Expenses
Investment adviser and administrator fees		2,117,602
Shareholder service fees		265,573
Index fees		255,271
Custodian fees		243,433
Shareholder reports		63,143
Portfolio accounting fees		62,230
Registration fees		52,213
Proxy fees		45,756
Transfer agent fees		31,626
Professional fees		27,878
Independent trustees' fees		11,713
Interest expense		1,438
Other expenses	+	33,752
Total expenses		3,211,628
Expense reduction by CSIM and its affiliates	–	482,138
Net expenses	–	2,729,490
Net investment income		42,425,623
Realized and Unrealized Gains (Losses)
Net realized losses on investments		(20,846,648)
Net realized losses on futures contracts		(5,192,104)
Net realized losses on foreign currency transactions	+	(73,199)
Net realized losses		(26,111,951)
Net change in unrealized appreciation (depreciation) on investments		(111,931,274)
Net change in unrealized appreciation (depreciation) on futures contracts		(85,335)
Net change in unrealized appreciation (depreciation) on foreign currency translations	+	590,695
Net change in unrealized appreciation (depreciation)	+	(111,425,914)
Net realized and unrealized losses		(137,537,865)
Decrease in net assets resulting from operations		($95,112,242)

50 See financial notes

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 Fundamental Global Real Estate Index 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
Schwab Large-Cap Growth Fund™
Schwab Small-Cap Equity Fund™	Schwab Investments (organized October 26, 1990)
Schwab Hedged Equity Fund™	Schwab 1000 Index Fund
Schwab Financial Services Fund™	Schwab Short-Term Bond Market Fund™
Schwab Health Care Fund™	Schwab Intermediate-Term Bond Fund™
Schwab ^® International Core Equity Fund	Schwab Total Bond Market Fund™
Schwab Target 2010 Fund	Schwab GNMA Fund™
Schwab Target 2015 Fund	Schwab ^® Treasury Inflation Protected Securities Index Fund
Schwab Target 2020 Fund	Schwab Tax-Free Bond Fund™
Schwab Target 2025 Fund	Schwab California Tax-Free Bond Fund™
Schwab Target 2030 Fund	Schwab Global Real Estate Fund™

Each fund in this report offers one share class. Shares are bought and sold (subject to a redemption fee, see financial note 9) at closing net asset value per share (NAV), which is the price for all outstanding shares of 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 funds follow the investment company accounting and reporting guidance of the Financial Accounting Standards Board Accounting Standard Codification Topic 946 Financial Services — Investment Companies. The accounting policies are in conformity with accounting principles generally accepted in the United States of America (GAAP).

The funds invest in certain other investment companies (underlying funds). For specific investments in underlying funds, please refer to the complete schedule of portfolio holdings on Form N-CSRS for this reporting period, which is filed with the U.S. Securities and Exchange Commission (SEC). For more information about the underlying funds’ operations and policies, please refer to those funds’ semiannual and annual reports, which are filed with the 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.

Schwab Equity Index Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

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

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

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

• Short-term securities (60 days or less to maturity): A short-term security may be valued at its amortized cost when it approximates the security's 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 significant 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, without consideration to the classification level of the specific investments held by an underlying fund.

Schwab Equity Index Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

• 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.

• 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, 2016 are disclosed in the Condensed 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 contracts are traded publicly on exchanges, and their market value may change daily.

Securities Lending: Under the trusts’ Securities Lending Program, a fund (lender) may make short-term loans of its securities to another party (borrower) to generate additional revenue for the fund. The borrower pledges collateral in the form of cash, securities issued or fully guaranteed by the U.S. government or foreign governments, or letters of credit issued by a bank. Collateral at the individual loan level is required to 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. The terms of the securities lending agreements allow the funds or the lending agent to terminate any loan at any given time and the securities must be returned within the earlier of the standard trade settlement period or the specified time period under the relevant securities lending agreement. 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.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 lending agent fees and broker rebates, associated

Schwab Equity Index Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

with securities lending activities under the trust’s Securities Lending Program paid to the unaffiliated lending agents ranged from 10% to 15%, with subsequent breakpoints to a low of 7.5%, of gross lending revenue through November 30, 2015. After December 1, 2015, the total costs and expenses to be paid to the unaffiliated lending agents start at 10% of gross lending revenue, with subsequent breakpoints to a low of 7.5%.

As of April 30, 2016, the funds had securities on loan, all of which were classified as common stocks. The value of the securities on loan and the related collateral as of April 30, 2016, if any, are disclosed in each fund's Condensed Portfolio Holdings. The value of the securities on loan and the investment of cash collateral are also disclosed in each fund's Statement of Assets and Liabilities.

Cash Management Transactions: The funds may subscribe to the Brown Brothers Harriman & Co. (BBH) Cash Management Service Sweep (CMS Sweep). The BBH CMS Sweep is an investment product that automatically sweeps the funds’ cash balances into overnight offshore time deposits with either the BBH Grand Cayman branch or a branch of a pre-approved commercial bank. This fully automated program allows the funds to earn interest on cash balances. Excess cash invested with deposit institutions domiciled outside of the U.S., as with any offshore deposit, may be subject to sovereign actions in the jurisdiction of the deposit institution including, but not limited to, freeze, seizure or diminution. The funds bear the risk associated with the repayment of principal and payment of interest on such instruments by the institution with which the deposit is ultimately placed. Balances in the CMS Sweep are accounted for on a cost basis, which approximates market value.

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 appreciation or depreciation arises 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 appreciation to provide for potential non-U.S. taxes payable upon the sale of these securities.

When a fund closes out a futures contract 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.

Schwab Equity Index Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

(e) Expenses:

Expenses that are specific to a fund are charged directly to the fund. Expenses that are common to all funds within a 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.

(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 net realized 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, 2016, if any, are reflected in each fund's Statement 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. Equity 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.

Schwab Equity Index Funds

Financial Notes, unaudited (continued)

3. Risk Factors (continued):

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

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 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. 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.

Schwab Equity Index Funds

Financial Notes, unaudited (continued)

3. Risk Factors (continued):

assets invested in derivatives can have a disproportionately large 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. A fund's use of derivatives could reduce the fund's performance, increase its volatility, and could cause the fund to lose more than the initial amount invested.

Liquidity Risk. A fund may be unable to sell certain securities, such as illiquid securities, readily at a favorable time or price, or the fund may have to sell them at a loss.

Securities 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 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:

% of Average Daily Net Assets		Schwab 1000 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 the period ended April 30, 2016, the aggregate advisory fee paid to CSIM by the Schwab 1000 Index Fund was 0.22%, as a percentage of the fund's average daily net assets.

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 S&P 500 Index Fund		Schwab Small-Cap Index Fund		Schwab Total Stock Market Index Fund		Schwab International 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 financial intermediaries, including Charles Schwab & Co., Inc. (a broker-dealer affiliate of CSIM, Schwab) (together, service providers), of certain account maintenance, customer liaison and shareholder services to the current shareholders of the funds.

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, as distributor of the funds (or, in the case of payments made to Schwab acting as a service provider, pursuant to Schwab’s written agreement with the funds), and a fund will pay no more than the amount set forth in the table below of the

Schwab Equity Index Funds

Financial Notes, unaudited (continued)

4. Affiliates and Affiliated Transactions (continued):

average annual daily net asset value of the fund shares owned by shareholders holding shares through such service provider. Payments under the Plan are made as described above without regard to whether the fee is more or less than the service provider’s actual cost of providing the services, and if more, such excess may be retained as profit by the service provider.

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

The funds may engage in certain transactions involving affiliates. For instance, a fund may own shares of The Charles Schwab Corporation if that company is included in its index. The table below shows funds with investment activities involving The Charles Schwab Corporation shares during the report period:

Fund	Balance of Shares Held at 10/31/15	Gross Purchases	Gross Sales	Balance of Shares Held at 04/30/16	Market Value at 04/30/16	Realized Gains (Losses) 11/01/15 to 04/30/16	Dividends Received 11/01/15 to 04/30/16
Schwab S&P 500 Index Fund	1,402,481	40,900	—	1,443,381	$41,006,454	$—	$170,752
Schwab 1000 Index Fund	375,265	—	—	375,265	10,661,279	—	45,032
Schwab Total Stock Market Index Fund	240,126	10,000	—	250,126	7,106,080	—	28,815

Schwab Equity Index Funds

Financial Notes, unaudited (continued)

4. Affiliates and Affiliated Transactions (continued):

Certain Schwab Funds may own shares of other Schwab Funds. The table below reflects the percentages of shares of each fund in this report that are owned by other Schwab Funds as of April 30, 2016, as applicable:

	Underlying 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
Schwab MarketTrack All Equity Portfolio	0.8%	—%	3.8%	—%	2.6%
Schwab MarketTrack Growth Portfolio	0.9%	—%	4.0%	—%	2.2%
Schwab MarketTrack Balanced Portfolio	0.5%	—%	2.2%	—%	1.2%
Schwab MarketTrack Conservative Portfolio	0.1%	—%	0.7%	—%	0.4%
Schwab MarketTrack Growth Portfolio II	0.0%*	0.0%*	0.2%	—%	0.2%
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	0.4%	—%	—%	—%	—%
Schwab Target 2045 Fund	0.0%*	—%	—%	—%	—%
Schwab Target 2050 Fund	0.0%*	—%	—%	—%	—%
Schwab Target 2055 Fund	0.0%*	—%	—%	—%	—%

*	Less than 0.05%

Certain other related parties may own shares of the funds in this report. As of April 30, 2016, 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 3.2%, 7.7% and 3.6%, respectively.

Pursuant to an exemptive order issued by the SEC, the funds may enter into interfund borrowing and lending transactions with other funds in the Fund Complex (for definition refer to Trustees and Officers section). All loans are for temporary or emergency purposes and the interest rate to be charged will be the average of the overnight repurchase agreement rate and the short-term bank loan rate. All loans are subject to numerous conditions designed to ensure fair and equitable treatment of all participating funds/portfolios. 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.

The funds may engage in direct transactions with certain other Schwab Funds when practical. When one fund is seeking to sell a security that another is seeking to buy, an interfund transaction can allow both funds to benefit by reducing transaction costs. This practice is limited to funds that share the same investment adviser, trustees and/or officers. For the period ended April 30, 2016, each fund’s total aggregate security transactions with other Schwab Funds were as follows:

	Total Aggregate Transactions	Realized Gains (Losses)
Schwab S&P 500 Index Fund	$78,901,310	$—
Schwab 1000 Index Fund	30,431,217	—
Schwab Small-Cap Index Fund	6,751,910	—
Schwab Total Stock Market Index Fund	10,773,954	—
Schwab International Index Fund	—	—

Schwab Equity Index Funds

Financial Notes, unaudited (continued)

5. Board of Trustees:

At a Special Meeting of Shareholders on December 11, 2015, twelve individuals were elected to serve as trustees of all trusts constituting the Schwab Funds, Laudus Funds and Schwab ETFs effective January 1, 2016. The twelve individuals elected to the Board of Trustees consist of the former Schwab Funds and Laudus Funds trustees, the former Schwab ETFs trustees and three new nominees. The trustees believe that combining the composition of the Board of Trustees and adding the new nominees will further align oversight of the Schwab Funds, Laudus Funds and Schwab ETFs, among other benefits.

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 trusts were in compliance with these limitations throughout the report period. The trusts did not pay any of these interested persons for their services as trustees, but they did pay non-interested persons (independent trustees), as noted on each fund’s Statement of Operations. For information regarding the trustees, please refer to the Trustees and Officers table at the end of this report.

6. Borrowing from Banks:

The funds are participants with other U.S. registered investment companies managed by CSIM in a joint, syndicated, committed $530 million line of credit (the Credit Facility), with State Street as agent, which matures on October 6, 2016. Under the terms of the Credit Facility, in addition to the interest charged on any borrowings by a fund, each fund pays a commitment fee of 0.125% per annum on its proportionate share of the unused portion of the Credit Facility. There were no borrowings from any of the lines of credit during the period.

The funds also have access to custodian overdraft facilities. A fund may have utilized the overdraft facility and incurred an 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. Derivatives:

Certain funds entered into equity index futures contracts during the report period. The funds invested in futures contracts to equitize available cash. The fair value and variation margin for futures contracts held at April 30, 2016 are presented on the Condensed Portfolio Holdings and Statement of Assets and Liabilities, respectively. The net realized and change in 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 ended April 30, 2016, 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	$167,888,271	1,688
Schwab 1000 Index Fund	46,166,896	463
Schwab Small-Cap Index Fund	18,636,758	166
Schwab Total Stock Market Index Fund	48,638,000	478
Schwab International Index Fund	25,224,363	305

8. Purchases and Sales/Maturities of Investment Securities:

For the period ended April 30, 2016, 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	$743,432,558	$155,802,665
Schwab 1000 Index Fund	163,348,892	200,864,914
Schwab Small-Cap Index Fund	163,038,429	130,547,420
Schwab Total Stock Market Index Fund	212,708,238	15,101,304
Schwab International Index Fund	281,792,995	33,658,195

Schwab Equity Index 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 on the Statement of Changes in Net Assets. The redemption fees charged during the current and prior periods are:

	Current Period (11/1/15-4/30/16)	Prior Period (11/1/14-10/31/15)
Schwab S&P 500 Index Fund	$198,651	$266,905
Schwab 1000 Index Fund	20,527	44,069
Schwab Small-Cap Index Fund	7,178	34,586
Schwab Total Stock Market Index Fund	32,359	50,564
Schwab International Index Fund	34,793	27,617

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, 2015, the funds had capital loss carryforwards available to offset future net capital gains before the expiration dates as follows:

Expiration Date	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
October 31, 2017	$—	$—	$—	$—	$13,252,761
No expiration*	—	—	—	—	61,829,409
Total	$—	$—	$—	$—	$75,082,170

*	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.

As of October 31, 2015, 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, 2015, 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.

Shareholder Vote Results (Unaudited)

Separate Special Meetings of Shareholders of Schwab Capital Trust and Schwab Investments (the “Trusts”) were held on December 11, 2015, for the purpose of seeking shareholder approval to elect the following individuals as trustees of the Trusts: Walter W. Bettinger II, Marie A. Chandoha, Joseph R. Martinetto, Robert W. Burns, John F. Cogan, Stephen T. Kochis, David L. Mahoney, Kiran M. Patel, Kimberly S. Patmore, Charles A. Ruffel, Gerald B. Smith, and Joseph H. Wender. The number of votes necessary to conduct the Special Meetings and approve the proposal were obtained. The results of the shareholder votes are listed below:

Schwab Capital Trust

Proposal – To elect each of the following individuals as trustees of the Trust:	For	Withheld
Walter W. Bettinger II	1,781,628,338.445	341,201,457.803
Marie A. Chandoha	2,069,741,484.184	53,088,312.064
Joseph R. Martinetto	2,070,394,888.403	52,434,907.845
Robert W. Burns	2,070,083,106.758	52,746,689.490
John F. Cogan	1,909,915,620.213	212,914,176.035
Stephen T. Kochis	2,067,778,859.342	55,050,936.906
David L. Mahoney	2,068,011,019.030	54,818,777.218
Kiran M. Patel	2,066,263,491.520	56,566,304.728
Kimberly S. Patmore	2,069,034,220.641	53,795,575.607
Charles A. Ruffel	2,070,448,922.775	52,380,873.473
Gerald B. Smith	2,069,060,923.296	53,768,872.952
Joseph H. Wender	2,065,502,834.216	57,326,962.032

Schwab Investments

Proposal – To elect each of the following individuals as trustees of the Trust:	For	Withheld
Walter W. Bettinger II	455,044,237.249	36,419,955.557
Marie A. Chandoha	477,959,152.412	13,505,040.394
Joseph R. Martinetto	477,030,357.012	14,433,835.794
Robert W. Burns	477,007,412.045	14,456,780.761
John F. Cogan	474,418,782.095	17,045,410.711
Stephen T. Kochis	475,828,281.753	15,635,911.053
David L. Mahoney	475,556,592.663	15,907,600.143
Kiran M. Patel	475,521,368.945	15,942,823.861
Kimberly S. Patmore	477,086,785.812	14,377,406.994
Charles A. Ruffel	476,771,942.158	14,692,250.648
Gerald B. Smith	474,861,961.806	16,602,231.000
Joseph H. Wender	474,877,465.494	16,586,727.312

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 and Laudus 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, and Position(s) with the trust (Terms of office, and length of Time Served¹)	Principal Occupations During the Past Five Years	Number of Portfolios in Fund Complex Overseen by the Trustee	Other Directorships
Robert W. Burns 1959 Trustee (Trustee of Schwab Strategic Trust since 2009; The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios and Laudus Trust since 2016)	Retired/Private Investor (Jan. 2009 – present). Formerly, Managing Director, Pacific Investment Management Company, LLC (PIMCO) and President, PIMCO Funds.	97	Director, PS Business Parks, Inc. (2005 – 2012)
John F. Cogan 1947 Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust and Schwab Annuity Portfolios since 2008; Laudus Trust since 2010; Schwab Strategic Trust since 2016)	Senior Fellow, The Hoover Institution at Stanford University (Oct. 1979 – present); Senior Fellow, Stanford Institute for Economic Policy Research (2000 – present); Professor of Public Policy, Stanford University (1994 – 2015).	97	Director, Gilead Sciences, Inc. (2005 – present)
Stephen Timothy Kochis 1946 Trustee (Trustee of Schwab Strategic Trust since 2012; The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios and Laudus Trust since 2016)	CEO and Owner, Kochis Global (wealth management consulting) (May 2012 – present); Chairman and CEO, Aspiriant, LLC (wealth management) (Jan. 2008 – Apr. 2012).	97	None
David L. Mahoney 1954 Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios and Laudus Trust since 2011; Schwab Strategic Trust since 2016)	Private Investor.	97	Director, Symantec Corporation (2003 – present) Director, Corcept Therapeutics Incorporated (2004 – present) Director, Adamas Pharmaceuticals, Inc. (2009 – present)
Kiran M. Patel 1948 Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios and Laudus Trust since 2011; Schwab Strategic Trust since 2016)	Retired. Executive Vice President and General Manager of Small Business Group, Intuit, Inc. (financial software and services firm for consumers and small businesses) (Dec. 2008 – Sept. 2013).	97	Director, KLA-Tencor Corporation (2008 – present)

Independent Trustees (continued)
Name, Year of Birth, and Position(s) with the trust (Terms of office, and length of Time Served¹)	Principal Occupations During the Past Five Years	Number of Portfolios in Fund Complex Overseen by the Trustee	Other Directorships
Kimberly S. Patmore 1956 Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2016)	Consultant, Patmore Management Consulting (management consulting) (2008 – present).	97	None
Charles A. Ruffel 1956 Trustee (Trustee of Schwab Strategic Trust since 2009; The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios and Laudus Trust since 2015)	Co-Chief Executive Officer, Kudu Investment Management, LLC (financial services) (Jan. 2015 – present); Partner, Kudu Advisors, LLC (financial services) (June 2008 – Jan. 2015); Advisor, Asset International, Inc. (publisher of financial services information) (Aug. 2008 – Jan. 2015).	97	None
Gerald B. Smith 1950 Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust and Schwab Annuity Portfolios since 2000; Laudus Trust since 2010; Schwab Strategic Trust since 2016)	Chairman, Chief Executive Officer and Founder of Smith Graham & Co. (investment advisors) (Mar. 1990 – present).	97	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 The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust and Schwab Annuity Portfolios since 2008; Laudus Trust since 2010; Schwab Strategic Trust since 2016)	Senior Consultant, Goldman Sachs & Co., Inc. (investment banking and securities firm) (Jan. 2008 – present); Partner, Colgin Partners, LLC (vineyards) (Feb. 1998 – present).	97	Board Member and Chairman of the Audit Committee, Isis Pharmaceuticals (1994 – present) Lead Independent Director and Chair of Audit Committee, OUTFRONT Media Inc. (2014 – present)

Interested Trustees
Name, Year of Birth, and Position(s) with the trust (Terms of office, and length of Time Served¹)	Principal Occupations During the Past Five Years	Number of Portfolios in Fund Complex Overseen by the Trustee	Other Directorships
Walter W. Bettinger II² 1960 Chairman and Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust and Schwab Annuity Portfolios since 2008; Schwab Strategic Trust since 2009; Laudus Trust since 2010)	Director, President and Chief Executive Officer, The Charles Schwab Corporation (Oct. 2008 – present); President and Chief Executive Officer (Oct. 2008 – present), Director (May 2008 – present), Charles Schwab & Co., Inc.; Director, Charles Schwab Bank (Apr. 2006 – present); and Director, Schwab Holdings, Inc. (May 2008 – present).	97	Director, The Charles Schwab Corporation (2008 – present)

Interested Trustees (continued)
Name, Year of Birth, and Position(s) with the trust (Terms of office, and length of Time Served¹)	Principal Occupations During the Past Five Years	Number of Portfolios in Fund Complex Overseen by the Trustee	Other Directorships
Marie A. Chandoha² 1961 Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2016)	Director, President and Chief Executive Officer (Dec. 2010 – present), Chief Investment Officer (Sept. 2010 – Oct. 2011), Charles Schwab Investment Management, Inc.; Trustee (Jan. 2016 – present), President, Chief Executive Officer (Dec. 2010 – present), and Chief Investment Officer (Sept. 2010 – Oct. 2011), Schwab Funds, Laudus Funds and Schwab ETFs; Director, Charles Schwab Worldwide Funds plc and Charles Schwab Asset Management (Ireland) Limited (Jan. 2011 – present); Global Head of Fixed Income Business Division, BlackRock, Inc. (formerly Barclays Global Investors) (Mar. 2007 – Aug. 2010).	97	None
Joseph R. Martinetto² 1962 Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2016)	Senior Executive Vice President and Chief Financial Officer, The Charles Schwab Corporation and Charles Schwab & Co., Inc. (July 2015 – present); Executive Vice President and Chief Financial Officer of The Charles Schwab Corporation and Charles Schwab & Co., Inc. (May 2007 – July 2015); Director, Charles Schwab & Co., Inc. (May 2007 – present); Director (Apr. 2010 – present) and Chief Executive Officer (July 2013 – Apr. 2015), Charles Schwab Bank; Director, Executive Vice President and Chief Financial Officer, Schwab Holdings, Inc. (May 2007 – present).	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 A. Chandoha 1961 President and Chief Executive Officer (Officer of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2010)	Director, President and Chief Executive Officer (Dec. 2010 – present), Chief Investment Officer (Sept. 2010 – Oct. 2011), Charles Schwab Investment Management, Inc.; Trustee (Jan. 2016 – present), President, Chief Executive Officer (Dec. 2010 – present), and Chief Investment Officer (Sept. 2010 – Oct. 2011), Schwab Funds, Laudus Funds and Schwab ETFs; Director, Charles Schwab Worldwide Funds plc and Charles Schwab Asset Management (Ireland) Limited (Jan. 2011 – present); Global Head of Fixed Income Business Division, BlackRock, Inc. (formerly Barclays Global Investors) (Mar. 2007 – Aug. 2010).
Mark Fischer 1970 Treasurer and Chief Financial Officer (Officer of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2013)	Treasurer and Chief Financial Officer, Schwab Funds, Laudus Funds and Schwab ETFs (Jan. 2016 – present); Assistant Treasurer, Schwab Funds and Laudus Funds (Dec. 2013 – Dec. 2015), Schwab ETFs (Nov. 2013 – Dec. 2015); Vice President, Charles Schwab Investment Management, Inc. (Oct. 2013 – present); Executive Director, J.P. Morgan Investor Services (Apr. 2011 – Sept. 2013); Assistant Treasurer, Massachusetts Financial Service Investment Management (May 2005 – Mar. 2011).

Officers of the Trust (continued)
Name, Year of Birth, and Position(s) with the trust (Terms of office, and length of Time Served³)	Principal Occupations During the Past Five Years
George Pereira 1964 Senior Vice President and Chief Operating Officer (Officer of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust and Schwab Annuity Portfolios since 2004; Laudus Trust since 2006; Schwab Strategic Trust since 2009)	Senior Vice President and Chief Financial Officer (Nov. 2004 – present), Chief Operating Officer (Jan. 2011 – present), Charles Schwab Investment Management, Inc.; Senior Vice President and Chief Operating Officer (Jan. 2016 – present), Treasurer and Chief Financial Officer, Laudus Funds (June 2006 – Dec. 2015); Treasurer and Principal Financial Officer, Schwab Funds (Nov. 2004 – Dec. 2015) and Schwab ETFs (Oct. 2009 – Dec. 2015); Director, Charles Schwab Worldwide Funds plc and Charles Schwab Asset Management (Ireland) Limited (Apr. 2005 – present).
Omar Aguilar 1970 Senior Vice President and Chief Investment Officer – Equities (Officer of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2011)	Senior Vice President and Chief Investment Officer – Equities, Charles Schwab Investment Management, Inc. (Apr. 2011 – present); Senior Vice President and Chief Investment Officer – Equities, Schwab Funds, Laudus Funds and Schwab ETFs (June 2011 – present); Head of the Portfolio Management Group and Vice President of Portfolio Management, Financial Engines, Inc. (May 2009 – Apr. 2011); Head of Quantitative Equity, ING Investment Management (July 2004 – Jan. 2009).
Brett Wander 1961 Senior Vice President and Chief Investment Officer – Fixed Income (Officer of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2011)	Senior Vice President and Chief Investment Officer – Fixed Income, Charles Schwab Investment Management, Inc. (Apr. 2011 – present); Senior Vice President and Chief Investment Officer – Fixed Income, Schwab Funds, Laudus Funds and Schwab ETFs (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 (Apr. 2006 – Jan. 2008).
David Lekich 1964 Chief Legal Officer and Secretary, Schwab Funds and Schwab ETFs Vice President and Assistant Clerk, Laudus Funds (Officer of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2011)	Senior Vice President (Sept. 2011 – present), Vice President (Mar. 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 (Apr. 2011 – present) and Chief Legal Officer (Dec. 2011 – present), Schwab Funds; Vice President and Assistant Clerk, Laudus Funds (Apr. 2011 – present); Secretary (May 2011 – present) and Chief Legal Officer (Nov. 2011 – present), Schwab ETFs.
Catherine MacGregor 1964 Vice President and Assistant Secretary, Schwab Funds and Schwab ETFs Chief Legal Officer, Vice President and Clerk, Laudus Funds (Officer of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios and Laudus Trust since 2005; Schwab Strategic Trust since 2009)	Vice President, Charles Schwab & Co., Inc., Charles Schwab Investment Management, Inc. (July 2005 – present); Vice President (Dec. 2005 – present), Chief Legal Officer and Clerk (Mar. 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	Each Trustee shall hold office until the election and qualification of his or her successor, or until he or she dies, resigns or is removed. The retirement policy requires that each independent trustee retire by December 31 of the year in which the Trustee turns 74 or the Trustee’s twentieth year of service as an independent trustee on any trust in the Fund Complex, whichever occurs first.
²	Mr. Bettinger, Ms. Chandoha, and Mr. Martinetto 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/Clerk 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.

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-backed securities (agency fixed-rate and hybrid ARM pass-throughs), 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 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.

International Spliced Index An internally calculated index, comprised of the Schwab International Index from inception of the Schwab International Index Fund until the close of business on 12/20/2011, the MSCI EAFE Index from 12/21/2011 until the close of business on 2/28/2013, and the MSCI EAFE Index (Net) from 3/1/2013 forward. The Schwab International Index includes the common stocks of the 350 largest publicly traded companies from selected countries outside of the United States.

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 (Net) is a free float-adjusted market capitalization index that is designed to measure equity market performance in the global emerging markets. This series approximates the minimum possible dividend reinvestment. 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 of 1933 (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.

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.csimfunds.com/schwabfunds_prospectus, the SEC’s website at 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.csimfunds.com/schwabfunds_prospectus or the SEC’s website at www.sec.gov.

The Schwab Funds Family^®

Stock Funds

Schwab Core Equity Fund™
Schwab Dividend Equity Fund™
Schwab Large-Cap Growth Fund™
Schwab Small-Cap Equity Fund™
Schwab Hedged Equity Fund™
Schwab Financial Services Fund™
Schwab Health Care Fund™
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 Fundamental Global Real Estate Index Fund
Schwab Global Real Estate Fund™
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™
Schwab MarketTrack All Equity Portfolio™
Schwab MarketTrack Growth Portfolio™
Schwab MarketTrack Balanced Portfolio™
Schwab MarketTrack Conservative Portfolio™
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™
Schwab Intermediate-Term Bond Fund™
Schwab Total Bond Market Fund™
Schwab GNMA Fund™
Schwab^® Treasury Inflation Protected Securities Index Fund
Schwab Tax-Free Bond Fund™
Schwab California Tax-Free Bond Fund™

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 many seek to preserve the value of your investment at $1 per share, it is possible to lose money.

Performance at a Glance

Total Return for the 6 Months Ended April 30, 2016
Schwab Core Equity Fund (Ticker Symbol: SWANX)	-4.25%
S&P 500^® Index	0.43%
Fund Category: Morningstar Large Blend	-1.04%
Performance Details	page 8

Schwab Dividend Equity Fund (Ticker Symbol: SWDSX)	-1.48%
Russell 1000^® Value Index	1.93%
Fund Category: Morningstar Large Value	0.34%
Performance Details	page 9

Schwab Large-Cap Growth Fund (Ticker Symbol: SWLSX)	-3.49%
Russell 1000^® Growth Index	-1.37%
Fund Category: Morningstar Large Growth	-3.70%
Performance Details	page 10

Schwab Small-Cap Equity Fund (Ticker Symbol: SWSCX)	-3.23%
Russell 2000^® Index	-1.90%
Fund Category: Morningstar Small Blend	-1.06%
Performance Details	page 11

Schwab Hedged Equity Fund (Ticker Symbol: SWHEX)	-1.36%
S&P 500^® Index	0.43%
Fund Category: Morningstar Long-Short Equity	-2.97%
Performance Details	page 12

Total Return for the 6 Months Ended April 30, 2016
Schwab Financial Services Fund (Ticker Symbol: SWFFX)	-3.98%
S&P 1500 SuperComposite Financials Sector Index	-1.58%
Fund Category: Morningstar Financial	-2.97%
Performance Details	page 13

Schwab Health Care Fund¹ (Ticker Symbol: SWHFX)	-2.42%
Dow Jones Global Health Care Index	-2.19%
Fund Category: Morningstar Health	-8.11%
Performance Details	page 14

Schwab International Core Equity Fund¹ (Ticker Symbol: SICNX)	-4.21%
MSCI EAFE^® Index (Net)²	-3.07%
Fund Category: Morningstar Foreign Large Blend	-3.11%
Performance Details	pages 15-16

Minimum Initial Investment³

$100

For index definitions, please see the Glossary.

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	The net version of the index reflects reinvested dividends net of withholding taxes, but reflects no deductions for expenses or other taxes.
³	Please see the funds' prospectus for further detail and eligibility requirements.

2Schwab 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,

The six-month reporting period ended April 30, 2016, proved rocky for most equity markets, as investors tried to assess whether slowing growth overseas would knock the U.S. recovery off course. The S&P 500^® Index dropped as much as 12% during the reporting period, only to end the six months back in slightly positive territory. Volatile oil and commodity prices also contributed to market fluctuations, and weighed on many financial institutions that suffered losses on loans made to energy firms. Overall, the period proved challenging for the Schwab Active Equity Funds, especially the Schwab Core Equity Fund and the Schwab Financial Services Fund, which were negatively affected by the heightened volatility most markets faced.

In the U.S., the Federal Reserve remained on hold through the first several months of 2016 after boosting interest rates in December for the first time since 2006, as economic data remained solid but not strong enough to fuel inflation. Quarterly corporate profits fell in the fourth quarter for the first time since 2008, during the financial crisis, and projections for first-quarter earnings indicated more of the same. Overseas, better-than-estimated export data out of China’s economy drove a rally in emerging market stocks, even as the leading credit rating agencies cut their respective outlooks for the country’s credit ratings due to slowing growth concerns. Meanwhile, fears of a recession in Japan and parts of Europe continued to weigh on stock prices in those markets.

Asset Class Performance Comparison % returns during the six months ended 4/30/2016

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.

* 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 Funds3

The Investment Environment

Schwab Active Equity Funds5

The Investment Environment continued

Index figures assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged and cannot be invested in directly. Performance results less than one year are not annualized. Past performance is not an indication of future results.

For index definitions, please see the Glossary.

Management views may have changed since the report date.

6Schwab Active Equity Funds

Fund Management

Jonas Svallin, CFA Vice President and Head of Active Equities, has overall responsibility for all aspects of the management of the funds and leads the Active Equity portfolio management and research team. 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 to 2009, Mr. Svallin was a principal and head portfolio manager at Algert Coldiron Investors LLC (now known as Algert Global). Prior to joining Algert, 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.

Iain Clayton, CFA, FRM, Managing Director and Senior Portfolio Manager, is responsible for the day-to-day co-management of the Schwab Core Equity Fund, Schwab International Core Equity Fund and Schwab Health Care Fund. Prior to joining CSIM in 2013, Mr. Clayton spent more than five years at SSI Investment Management, where he was a portfolio manager and director of quantitative research. In these roles, Mr. Clayton co-managed multiple investment strategies and developed quantitative models and valuation approaches. From 2004 to 2008, he worked as a portfolio manager and director at RCM Capital Management (now known as Allianz Global Investors) and helped manage various equity portfolios and developed fundamental-based stock selection models. Prior to that, he was a vice president at Eureka Investment Advisors for almost three years and also served as a senior quantitative analyst/assistant portfolio manager. He has also worked as a quantitative research analyst at RCM Capital Management.

Schwab Active Equity Funds7

Schwab Core Equity Fund

Performance and Fund Facts as of 04/30/16

Average Annual Total Returns^1,2,3

Fund and Inception Date	6 Months	1 Year	5 Years	10 Years
Fund: Schwab Core Equity Fund (7/1/96)	-4.25%	-3.50%	9.08%	6.00%
S&P 500^® Index	0.43%	1.21%	11.02%	6.91%
Fund Category: Morningstar Large Blend	-1.04%	-1.97%	9.15%	5.94%

Fund Expense Ratio⁴: 0.74%

Statistics
Number of Holdings	144
Weighted Average Market Cap (millions)	$110,018
Price/Earnings Ratio (P/E)	22.1
Price/Book Ratio (P/B)	2.4
Portfolio Turnover Rate	37%

Sector Weightings % of Investments
Information Technology	18.2%
Financials	15.7%
Health Care	15.5%
Consumer Discretionary	12.9%
Industrials	11.3%
Consumer Staples	10.2%
Energy	6.8%
Utilities	4.7%
Materials	3.0%
Telecommunication Services	1.4%
Other	0.3%
Total	100.0%

Top Equity Holdings % of Net Assets⁵
Apple, Inc.	3.0%
Citigroup, Inc.	2.8%
PepsiCo, Inc.	2.7%
Merck & Co., Inc.	2.3%
Microsoft Corp.	2.2%
Lowe's Cos., Inc.	2.1%
Alphabet, Inc., Class A	2.1%
Amazon.com, Inc.	2.0%
Pfizer, Inc.	2.0%
UGI Corp.	2.0%
Total	23.2%

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 fund operating expenses without contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
⁵	This list is not a recommendation of any security by the investment adviser.

8Schwab Active Equity Funds

Schwab Dividend Equity Fund

Performance and Fund Facts as of 04/30/16

Average Annual Total Returns^1,2,3

Fund and Inception Date	6 Months	1 Year	5 Years	10 Years
Fund: Schwab Dividend Equity Fund (9/2/03)	-1.48%	-4.47%	8.91%	5.92%
Russell 1000^® Value Index	1.93%	-0.40%	10.13%	5.67%
Dividend Equity Spliced Index	1.93%	-0.40%	10.70%	6.76%
S&P 500^® Index	0.43%	1.21%	11.02%	6.91%
Fund Category: Morningstar Large Value	0.34%	-2.54%	8.51%	5.16%

Fund Expense Ratio⁴: 0.88%

Yields¹

30-Day SEC Yield

1.69%

Statistics
Number of Holdings	145
Weighted Average Market Cap (millions)	$91,230
Price/Earnings Ratio (P/E)	23.1
Price/Book Ratio (P/B)	1.8
Portfolio Turnover Rate	28%

Sector Weightings % of Investments
Financials	27.3%
Energy	13.3%
Health Care	13.0%
Industrials	12.1%
Information Technology	9.1%
Utilities	8.5%
Consumer Staples	6.3%
Consumer Discretionary	4.8%
Materials	4.1%
Telecommunication Services	1.3%
Other	0.2%
Total	100.0%

Top Equity Holdings % of Net Assets⁵
JPMorgan Chase & Co.	4.1%
Exxon Mobil Corp.	3.9%
Citigroup, Inc.	3.5%
Pfizer, Inc.	3.0%
Chevron Corp.	2.3%
UGI Corp.	2.1%
Entergy Corp.	2.0%
Intel Corp.	1.9%
Voya Financial, Inc.	1.7%
Fifth Third Bancorp	1.7%
Total	26.2%

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 fund operating expenses without contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
⁵	This list is not a recommendation of any security by the investment adviser.

Schwab Active Equity Funds9

Schwab Large-Cap Growth Fund

Performance and Fund Facts as of 04/30/16

Average Annual Total Returns^1,2,3

Fund and Inception Date	6 Months	1 Year	5 Years	10 Years
Fund: Schwab Large-Cap Growth Fund (10/3/05)	-3.49%	-3.00%	9.58%	6.55%
Russell 1000^® Growth Index	-1.37%	1.07%	11.44%	8.20%
Fund Category: Morningstar Large Growth	-3.70%	-2.51%	9.24%	6.60%

Fund Expense Ratios⁴: Net 0.99%; Gross 1.03%

Statistics
Number of Holdings	107
Weighted Average Market Cap (millions)	$108,207
Price/Earnings Ratio (P/E)	21.2
Price/Book Ratio (P/B)	3.3
Portfolio Turnover Rate	33%

Sector Weightings % of Investments
Information Technology	25.5%
Consumer Discretionary	20.9%
Health Care	16.6%
Industrials	12.1%
Consumer Staples	10.0%
Financials	7.8%
Materials	2.8%
Utilities	2.0%
Energy	1.2%
Telecommunication Services	1.1%
Total	100.0%

Top Equity Holdings % of Net Assets⁵
Apple, Inc.	5.1%
Amazon.com, Inc.	4.0%
Alphabet, Inc., Class A	3.9%
PepsiCo, Inc.	3.4%
Comcast Corp., Class A	3.2%
Amgen, Inc.	2.8%
Lowe's Cos., Inc.	2.5%
Facebook, Inc., Class A	2.3%
Gilead Sciences, Inc.	2.1%
Omnicom Group, Inc.	2.1%
Total	31.4%

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 the investment 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	This list is not a recommendation of any security by the investment adviser.

10Schwab Active Equity Funds

Schwab Small-Cap Equity Fund

Performance and Fund Facts as of 04/30/16

Average Annual Total Returns^1,2,3

Fund and Inception Date	6 Months	1 Year	5 Years	10 Years
Fund: Schwab Small-Cap Equity Fund (7/1/03)	-3.23%	-5.11%	9.57%	5.35%
Russell 2000^® Index	-1.90%	-5.94%	6.98%	5.42%
Fund Category: Morningstar Small Blend	-1.06%	-5.31%	6.51%	5.22%

Fund Expense Ratio⁴: 1.09%

Statistics
Number of Holdings	314
Weighted Average Market Cap (millions)	$1,504
Price/Earnings Ratio (P/E)	47.3
Price/Book Ratio (P/B)	1.9
Portfolio Turnover Rate	38%

Sector Weightings % of Investments
Financials	24.2%
Information Technology	17.9%
Health Care	15.6%
Industrials	14.3%
Consumer Discretionary	11.7%
Consumer Staples	3.9%
Energy	3.4%
Materials	2.0%
Utilities	1.6%
Telecommunication Services	1.5%
Other	3.9%
Total	100.0%

Top Equity Holdings % of Net Assets⁵
Mack-Cali Realty Corp.	1.3%
First Industrial Realty Corp.	1.3%
Wabash National Corp.	1.2%
KCG Holdings, Inc., Class A	1.2%
CoreSite Realty Corp.	1.2%
Tenneco, Inc.	1.1%
Dean Foods Co.	1.1%
RE/MAX Holdings, Inc., Class A	1.1%
Empire State Realty Trust, Inc., Class A	1.1%
TCF Financial Corp.	1.1%
Total	11.7%

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 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 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 fund operating expenses without contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
⁵	This list is not a recommendation of any security by the investment adviser.

Schwab Active Equity Funds11

Schwab Hedged Equity Fund

Performance and Fund Facts as of 04/30/16

Average Annual Total Returns^1,2,3

Fund and Inception Date	6 Months	1 Year	5 Years	10 Years
Fund: Schwab Hedged Equity Fund (9/3/02)	-1.36%	0.72%	5.51%	3.96%
S&P 500^® Index	0.43%	1.21%	11.02%	6.91%
Fund Category: Morningstar Long-Short Equity	-2.97%	-4.90%	2.53%	4.61%

Fund Expense Ratios⁴: Net 1.82%; Gross 1.84%

Statistics
Number of Holdings
Long Holdings	126
Short Holdings	78
Weighted Average Market Cap (millions)
Long Holdings	$57,940
Short Holdings	$7,284
Price/Earnings Ratio (P/E)
Long Holdings	40.8
Short Holdings	370.3
Price/Book Ratio (P/B)
Long Holdings	2.1
Short Holdings	2.9
Portfolio Turnover Rate	69%
Portfolio Turnover Rate excluding short sales	47%

Top Equity Long Holdings % of Net Assets⁵
Apple, Inc.	3.2%
Amazon.com, Inc.	2.8%
Bank of America Corp.	2.4%
Amgen, Inc.	2.3%
Citigroup, Inc.	2.3%
Total	13.0%

Top Equity Short Holdings % of Net Assets⁵
Louisiana-Pacific Corp.	1.3%
Monster Beverage Corp.	1.3%
Martin Marietta Materials, Inc.	1.3%
Dunkin' Brands Group, Inc.	1.3%
Hexcel Corp.	1.2%
Total	6.4%

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	As stated in the prospectus. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as the investment 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	This list is not a recommendation of any security by the investment adviser.

12Schwab Active Equity Funds

Schwab Financial Services Fund

Performance and Fund Facts as of 04/30/16

Average Annual Total Returns^1,2

Fund and Inception Date	6 Months	1 Year	5 Years	10 Years
Fund: Schwab Financial Services Fund (7/3/00)	-3.98%	-3.86%	7.94%	0.95%
S&P 1500 SuperComposite Financials Sector Index	-1.58%	-0.54%	9.51%	-0.86%
S&P 500^® Index	0.43%	1.21%	11.02%	6.91%
Fund Category: Morningstar Financial	-2.97%	-4.11%	7.09%	1.28%

Fund Expense Ratio³: 0.93%

Statistics
Number of Holdings	94
Weighted Average Market Cap (millions)	$82,144
Price/Earnings Ratio (P/E)	14.9
Price/Book Ratio (P/B)	1.2
Portfolio Turnover Rate	27%

Industry Weightings % of Investments
Banks	36.9%
Diversified Financials	23.8%
Real Estate	23.8%
Insurance	14.5%
Other	1.0%
Total	100.0%

Top Equity Holdings % of Net Assets⁴
Berkshire Hathaway, Inc., Class B	6.6%
JPMorgan Chase & Co.	6.1%
Wells Fargo & Co.	5.8%
Bank of America Corp.	5.2%
Citigroup, Inc.	4.8%
Simon Property Group, Inc.	3.6%
MetLife, Inc.	2.4%
The PNC Financial Services Group, Inc.	2.3%
The Goldman Sachs Group, Inc.	1.9%
Discover Financial Services	1.9%
Total	40.6%

For index definitions, please see the Glossary.

Since the Schwab 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. Reflects the total annual fund operating expenses without contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
⁴	This list is not a recommendation of any security by the investment adviser.

Schwab Active Equity Funds13

Schwab Health Care Fund

Performance and Fund Facts as of 04/30/16

Average Annual Total Returns^1,2

Fund and Inception Date	6 Months	1 Year	5 Years	10 Years
Fund: Schwab Health Care Fund (7/3/00)	-2.42%	-3.75%	15.49%	10.53%
Dow Jones Global Health Care Index	-2.19%	-4.34%	13.85%	9.17%
S&P 500^® Index	0.43%	1.21%	11.02%	6.91%
Fund Category: Morningstar Health	-8.11%	-10.35%	15.41%	10.77%

Fund Expense Ratio³: 0.79%

Statistics
Number of Holdings	92
Weighted Average Market Cap (millions)	$85,871
Price/Earnings Ratio (P/E)	22.6
Price/Book Ratio (P/B)	3.7
Portfolio Turnover Rate	27%

Industry Weightings % of Investments
Pharmaceuticals, Biotechnology & Life Sciences	71.7%
Health Care Equipment & Services	28.1%
Other	0.2%
Total	100.0%

Top Equity Holdings % of Net Assets⁴
Johnson & Johnson	7.5%
Pfizer, Inc.	5.7%
Gilead Sciences, Inc.	5.5%
Merck & Co., Inc.	5.1%
Amgen, Inc.	4.9%
Roche Holding AG	3.0%
Celgene Corp.	2.8%
AbbVie, Inc.	2.6%
C.R. Bard, Inc.	2.5%
Express Scripts Holding Co.	2.4%
Total	42.0%

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 Schwab 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. Reflects the total annual fund operating expenses without contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
⁴	This list is not a recommendation of any security by the investment adviser.

14Schwab Active Equity Funds

Schwab International Core Equity Fund

Performance and Fund Facts as of 04/30/16

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)	-4.21%	-8.67%	3.86%	1.28%
MSCI EAFE^® Index (Net)⁴	-3.07%	-9.32%	1.69%	-0.08%
MSCI EAFE^® Index (Gross)	-2.82%	-8.89%	2.16%	0.37%
Fund Category: Morningstar Foreign Large Blend	-3.11%	-9.96%	0.83%	-0.62%

Fund Expense Ratios⁵: Net 0.86%; Gross 0.92%

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	The net version of the index reflects reinvested dividends net of withholding taxes, but reflects no deductions for expenses or other taxes.
⁵	As stated in the prospectus. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as the investment 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.

Schwab Active Equity Funds15

Fund Expenses (Unaudited)

Examples for a $1,000 Investment

	Expense Ratio¹ (Annualized)	Beginning Account Value at 11/1/15	Ending Account Value (Net of Expenses) at 4/30/16	Expenses Paid During Period² 11/1/15–4/30/16
Schwab Core Equity Fund
Actual Return	0.73%	$1,000.00	$ 957.50	$ 3.55
Hypothetical 5% Return	0.73%	$1,000.00	$ 1,021.27	$ 3.67
Schwab Dividend Equity Fund
Actual Return	0.88%	$1,000.00	$ 985.20	$ 4.34
Hypothetical 5% Return	0.88%	$1,000.00	$ 1,020.52	$ 4.42
Schwab Large-Cap Growth Fund
Actual Return	0.99%	$1,000.00	$ 965.10	$ 4.84
Hypothetical 5% Return	0.99%	$1,000.00	$1,019.98	$ 4.97
Schwab Small-Cap Equity Fund
Actual Return	1.09%	$1,000.00	$ 967.70	$ 5.33
Hypothetical 5% Return	1.09%	$1,000.00	$1,019.48	$ 5.47
Schwab Hedged Equity Fund
Actual Return	1.80%	$1,000.00	$ 986.40	$8.89
Hypothetical 5% Return	1.80%	$1,000.00	$ 1,015.95	$ 9.02
Schwab Financial Services Fund
Actual Return	0.88%	$1,000.00	$ 960.20	$ 4.29
Hypothetical 5% Return	0.88%	$1,000.00	$ 1,020.52	$ 4.42
Schwab Health Care Fund
Actual Return	0.79%	$1,000.00	$ 975.80	$3.88
Hypothetical 5% Return	0.79%	$1,000.00	$ 1,020.97	$ 3.97
Schwab International Core Equity Fund
Actual Return	0.86%	$1,000.00	$ 957.90	$ 4.19
Hypothetical 5% Return	0.86%	$1,000.00	$ 1,020.62	$ 4.32

¹	Based on the most recent six-month expense ratio; may differ from the expense ratio provided in the Financial Highlights. This ratio also does not include certain non-routine expenses, such as proxy expenses.
²	Expenses for each fund are equal to its annualized expense ratio, multiplied by the average account value over the period, multiplied by the 182 days of the period, and divided by the 366 days of the fiscal year.

Schwab Active Equity Funds17

Schwab Core Equity Fund

Financial Statements

Financial Highlights

	11/1/15– 4/30/16*	11/1/14– 10/31/15	11/1/13– 10/31/14	11/1/12– 10/31/13	11/1/11– 10/31/12	11/1/10– 10/31/11
Per-Share Data
Net asset value at beginning of period	$23.10	$25.48	$23.46	$18.80	$16.81	$15.78
Income (loss) from investment operations:
Net investment income (loss)	0.21 ¹	0.30 ¹	0.30	0.32	0.26	0.19
Net realized and unrealized gains (losses)	(1.09)	1.05	3.60	4.51	2.07	1.01
Total from investment operations	(0.88)	1.35	3.90	4.83	2.33	1.20
Less distributions:
Distributions from net investment income	(0.36)	(0.33)	(0.22)	(0.17)	(0.34)	(0.17)
Distributions from net realized gains	(2.95)	(3.40)	(1.66)	—	—	—
Total distributions	(3.31)	(3.73)	(1.88)	(0.17)	(0.34)	(0.17)
Net asset value at end of period	$18.91	$23.10	$25.48	$23.46	$18.80	$16.81
Total return	(4.25%) ²	5.61%	17.88%	25.89%	13.99%	7.60%
Ratios/Supplemental Data
Ratios to average net assets:
Net operating expenses	0.73% ³	0.74%	0.72%	0.72%	0.72%	0.73%
Gross operating expenses	0.74% ³	0.74%	0.72%	0.73%	0.73%	0.73%
Net investment income (loss)	2.19% ³	1.29%	1.19%	1.51%	1.37%	1.06%
Portfolio turnover rate	37% ²	81%	63%	80%	45% ⁴	35%
Net assets, end of period (x 1,000,000)	$2,134	$2,363	$2,317	$2,247	$1,880	$1,719

*	Unaudited.

Calculated based on the average shares outstanding during the period.

Not annualized.

Annualized (except for proxy costs).

⁴

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, 2016 (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 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 fund also makes available its complete schedule of portfolio holdings 15 to 20 days after calendar quarters on the fund's website at www.csimfunds.com/schwabfunds_prospectus.

Holdings by Category		Cost ($)	Value ($)
99.8%	Common Stock	1,939,856,591	2,128,258,765
0.3%	Other Investment Companies	7,071,055	7,071,055
100.1%	Total Investments	1,946,927,646	2,135,329,820
(0.1%)	Other Assets and Liabilities, Net		(1,501,704)
100.0%	Net Assets		2,133,828,116

Security	Number of Shares	Value ($)
Common Stock 99.8% of net assets
Automobiles & Components 1.7%
Lear Corp.	310,820	35,784,707
Banks 6.0%
Bank of America Corp.	1,119,549	16,300,633
Citigroup, Inc.	1,277,382	59,117,239
Fifth Third Bancorp	893,944	16,368,115
JPMorgan Chase & Co.	420,304	26,563,213
MGIC Investment Corp. *	699,480	5,057,240
Radian Group, Inc.	275,858	3,528,224
		126,934,664
Capital Goods 8.4%
3M Co.	30,093	5,036,967
BWX Technologies, Inc.	351,717	11,743,831
Carlisle Cos., Inc.	229,359	23,371,682
Eaton Corp. plc	411,116	26,011,309
Fluor Corp.	106,464	5,819,322
Huntington Ingalls Industries, Inc.	178,312	25,814,228
Illinois Tool Works, Inc.	107,789	11,266,106
Joy Global, Inc.	13,250	282,225
Owens Corning	235,398	10,844,786
Quanta Services, Inc. *	86,880	2,060,794
Spirit AeroSystems Holdings, Inc., Class A *	495,128	23,345,285
Stanley Black & Decker, Inc.	241,022	26,975,182
The Toro Co.	69,380	5,997,901
		178,569,618
Commercial & Professional Supplies 1.2%
R.R. Donnelley & Sons Co.	1,436,729	24,999,085

Security	Number of Shares	Value ($)
Consumer Durables & Apparel 0.2%
Michael Kors Holdings Ltd. *	77,163	3,986,241
Consumer Services 1.4%
Darden Restaurants, Inc.	385,840	24,018,540
Six Flags Entertainment Corp.	42,530	2,553,926
Vail Resorts, Inc.	33,437	4,334,773
		30,907,239
Diversified Financials 2.9%
Ally Financial, Inc. *	303,669	5,408,345
Berkshire Hathaway, Inc., Class B *	50,570	7,356,924
Discover Financial Services	106,744	6,006,485
Lazard Ltd., Class A	133,885	4,826,554
The Bank of New York Mellon Corp.	223,392	8,989,294
Voya Financial, Inc.	909,090	29,518,152
		62,105,754
Energy 6.8%
Apache Corp.	72,004	3,917,018
Chevron Corp.	124,634	12,735,102
ConocoPhillips	240,054	11,472,181
CVR Energy, Inc.	149,118	3,620,585
Devon Energy Corp.	354,855	12,306,371
Exxon Mobil Corp.	421,354	37,247,694
FMC Technologies, Inc. *	445,705	13,589,545
Marathon Petroleum Corp.	365,951	14,301,365
Patterson-UTI Energy, Inc.	269,735	5,327,266
RPC, Inc. (a)	357,906	5,411,539
Transocean Ltd. (a)	218,481	2,420,769
Valero Energy Corp.	368,839	21,713,552
		144,062,987
Food & Staples Retailing 2.3%
The Kroger Co.	531,518	18,810,422
Wal-Mart Stores, Inc.	440,092	29,428,952
		48,239,374
Food, Beverage & Tobacco 6.1%
Altria Group, Inc.	239,049	14,990,763
Campbell Soup Co.	103,900	6,411,669
ConAgra Foods, Inc.	71,523	3,187,065
Dr Pepper Snapple Group, Inc.	311,006	28,273,555
General Mills, Inc.	136,778	8,389,963
Ingredion, Inc.	57,826	6,655,194
PepsiCo, Inc.	551,708	56,803,856
The JM Smucker Co.	8,494	1,078,568
Tyson Foods, Inc., Class A	80,443	5,294,758
		131,085,391
Health Care Equipment & Services 5.9%
AmerisourceBergen Corp.	320,725	27,293,698
C.R. Bard, Inc.	175,223	37,177,064
Cardinal Health, Inc.	171,819	13,480,919
Hologic, Inc. *	1,020,087	34,264,722
IMS Health Holdings, Inc. *	172,227	4,588,127

See financial notes 19

Schwab Core Equity Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Molina Healthcare, Inc. *	142,104	7,355,303
ResMed, Inc.	29,376	1,639,181
		125,799,014
Household & Personal Products 1.8%
Kimberly-Clark Corp.	51,878	6,494,607
Spectrum Brands Holdings, Inc.	112,204	12,746,374
The Clorox Co.	31,237	3,911,810
The Procter & Gamble Co.	202,959	16,261,075
		39,413,866
Insurance 2.9%
American Financial Group, Inc.	248,828	17,196,503
Everest Re Group Ltd.	12,824	2,371,158
MetLife, Inc.	412,456	18,601,765
Prudential Financial, Inc.	17,498	1,358,545
The Allstate Corp.	55,331	3,599,281
The Hanover Insurance Group, Inc.	62,947	5,398,335
The Travelers Cos., Inc.	53,532	5,883,167
Unum Group	233,383	7,984,032
		62,392,786
Materials 3.0%
Air Products & Chemicals, Inc.	33,550	4,894,609
Cabot Corp.	131,344	6,408,274
International Paper Co.	277,023	11,986,785
PolyOne Corp.	191,260	6,881,535
PPG Industries, Inc.	75,443	8,328,153
RPM International, Inc.	238,200	12,036,246
The Sherwin-Williams Co.	46,981	13,498,111
		64,033,713
Media 3.3%
Comcast Corp., Class A	691,487	42,014,750
Omnicom Group, Inc.	201,390	16,709,328
The Interpublic Group of Cos., Inc.	166,910	3,828,916
The Walt Disney Co.	74,245	7,666,539
		70,219,533
Pharmaceuticals, Biotechnology & Life Sciences 9.6%
AbbVie, Inc.	176,062	10,739,782
Amgen, Inc.	244,053	38,633,590
Charles River Laboratories International, Inc. *	42,437	3,363,981
Gilead Sciences, Inc.	359,423	31,704,703
Johnson & Johnson	257,250	28,832,580
Merck & Co., Inc.	899,153	49,309,550
Pfizer, Inc.	1,298,658	42,479,103
		205,063,289
Real Estate 3.9%
Equity LifeStyle Properties, Inc.	88,314	6,048,626
Lamar Advertising Co., Class A	190,288	11,805,468
Mid-America Apartment Communities, Inc.	17,941	1,717,133

Security	Number of Shares	Value ($)
Simon Property Group, Inc.	201,107	40,456,695
SL Green Realty Corp.	225,903	23,737,887
		83,765,809
Retailing 6.3%
Amazon.com, Inc. *	64,666	42,653,047
American Eagle Outfitters, Inc.	285,264	4,082,128
Best Buy Co., Inc.	313,984	10,072,607
Lowe's Cos., Inc.	591,220	44,944,544
Target Corp.	184,248	14,647,716
The Home Depot, Inc.	112,159	15,016,968
The TJX Cos., Inc.	41,583	3,152,823
		134,569,833
Semiconductors & Semiconductor Equipment 1.8%
Intel Corp.	485,694	14,706,815
Lam Research Corp.	26,900	2,055,160
Maxim Integrated Products, Inc.	59,900	2,139,628
Microsemi Corp. *	266,423	9,002,433
ON Semiconductor Corp. *	680,892	6,448,047
Teradyne, Inc.	156,476	2,958,961
		37,311,044
Software & Services 11.6%
Alphabet, Inc., Class A *	61,989	43,880,773
Alphabet, Inc., Class C *	10,791	7,478,271
Citrix Systems, Inc. *	31,000	2,537,040
Computer Sciences Corp.	664,927	22,029,032
CoreLogic, Inc. *	114,548	4,064,163
eBay, Inc. *	378,285	9,241,503
Facebook, Inc., Class A *	199,856	23,499,068
Genpact Ltd. *	81,705	2,278,752
Leidos Holdings, Inc.	390,346	19,365,065
Microsoft Corp.	935,751	46,665,902
Nuance Communications, Inc. *	438,088	7,526,352
Oracle Corp.	109,166	4,351,357
Synopsys, Inc. *	171,023	8,127,013
Take-Two Interactive Software, Inc. *	33,435	1,142,808
Teradata Corp. *	359,820	9,103,446
Vantiv, Inc., Class A *	177,101	9,659,089
VeriSign, Inc. *	96,010	8,295,264
Xerox Corp.	1,964,112	18,855,475
		248,100,373
Technology Hardware & Equipment 4.8%
Apple, Inc.	686,270	64,330,950
Ciena Corp. *	165,502	2,785,399
Cisco Systems, Inc.	926,957	25,482,048
Jabil Circuit, Inc.	281,066	4,879,306
Juniper Networks, Inc.	236,421	5,532,251
		103,009,954
Telecommunication Services 1.4%
AT&T, Inc.	170,224	6,608,096
Verizon Communications, Inc.	463,292	23,600,094
		30,208,190

20 See financial notes

Schwab Core Equity Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Transportation 1.8%
Delta Air Lines, Inc.	870,769	36,284,944
United Parcel Service, Inc., Class B	19,992	2,100,560
		38,385,504
Utilities 4.7%
Ameren Corp.	47,227	2,266,896
CenterPoint Energy, Inc.	475,101	10,190,916
Entergy Corp.	391,556	29,437,180
FirstEnergy Corp.	233,689	7,615,925
UGI Corp.	1,052,970	42,371,513
Xcel Energy, Inc.	185,570	7,428,367
		99,310,797
Total Common Stock
(Cost $1,939,856,591)		2,128,258,765

Other Investment Companies 0.3% of net assets
Money Market Fund 0.1%
State Street Institutional U.S. Government Money Market Fund, Premier Class 0.23% (b)	3,140,705	3,140,705

Security	Number of Shares	Value ($)
Securities Lending Collateral 0.2%
Wells Fargo Advantage Government Money Market Fund, Institutional Class 0.23% (b)	3,930,350	3,930,350
Total Other Investment Companies
(Cost $7,071,055)		7,071,055

End of Investments.

At 04/30/16, the tax basis cost of the fund's investments was $1,948,904,696 and the unrealized appreciation and depreciation were $258,048,532 and ($71,623,408), respectively, with a net unrealized appreciation of $186,425,124.

*	Non-income producing security.
(a)	All or a portion of this security is on loan. Securities on loan were valued at $3,824,080.
(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, 2016 (see financial note 2(a) for additional information):

Description	Quoted Prices in Active Markets for Identical Assets (Level 1)	Other Significant Observable Inputs (Level 2)	Significant Unobservable Inputs (Level 3)	Total
Common Stock¹	$2,128,258,765	$—	$—	$2,128,258,765
Other Investment Companies¹	7,071,055	—	—	7,071,055
Total	$2,135,329,820	$—	$—	$2,135,329,820

¹	As categorized in Portfolio Holdings.

See financial notes 21

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
	11/1/15-4/30/16		11/1/14-10/31/15
Net investment income		$23,760,876	$30,380,445
Net realized gains (losses)		(25,892,784)	307,255,040
Net change in unrealized appreciation (depreciation)	+	(96,740,567)	(207,380,437)
Increase (decrease) in net assets from operations		(98,872,475)	130,255,048
Distributions to Shareholders
Distributions from net investment income		(37,055,587)	(30,311,016)
Distributions from net realized gains	+	(299,452,225)	(308,068,333)
Total distributions		($336,507,812)	($338,379,349)

Transactions in Fund Shares
		11/1/15-4/30/16		11/1/14-10/31/15
		SHARES	VALUE	SHARES	VALUE
Shares sold		8,239,502	$156,783,204	12,845,696	$293,750,932
Shares reinvested		12,520,076	244,391,884	10,461,915	236,857,753
Shares redeemed	+	(10,190,080)	(194,843,706)	(11,947,882)	(276,936,418)
Net transactions in fund shares		10,569,498	$206,331,382	11,359,729	$253,672,267
Shares Outstanding and Net Assets
		11/1/15-4/30/16		11/1/14-10/31/15
		SHARES	NET ASSETS	SHARES	NET ASSETS
Beginning of period		102,293,901	$2,362,877,021	90,934,172	$2,317,329,055
Total increase or decrease	+	10,569,498	(229,048,905)	11,359,729	45,547,966
End of period		112,863,399	$2,133,828,116	102,293,901	$2,362,877,021
Net investment income not yet distributed			$9,662,312		$22,957,023

24 See financial notes

Schwab Dividend Equity Fund

Financial Statements

Financial Highlights

	11/1/15– 4/30/16*	11/1/14– 10/31/15	11/1/13– 10/31/14	11/1/12– 10/31/13	11/1/11– 10/31/12	11/1/10– 10/31/11
Per-Share Data
Net asset value at beginning of period	$16.43	$19.17	$18.22	$14.52	$13.15	$12.08
Income (loss) from investment operations:
Net investment income (loss)	0.19 ¹	0.29 ¹	0.27	0.32	0.27	0.23
Net realized and unrealized gains (losses)	(0.43)	(0.21)	2.16	3.70	1.38	1.06
Total from investment operations	(0.24)	0.08	2.43	4.02	1.65	1.29
Less distributions:
Distributions from net investment income	(0.19)	(0.27)	(0.29)	(0.32)	(0.28)	(0.22)
Distributions from net realized gains	(1.74)	(2.55)	(1.19)	—	—	—
Total distributions	(1.93)	(2.82)	(1.48)	(0.32)	(0.28)	(0.22)
Net asset value at end of period	$14.26	$16.43	$19.17	$18.22	$14.52	$13.15
Total return	(1.48%) ²	0.12%	14.26%	27.99%	12.65%	10.73%
Ratios/Supplemental Data
Ratios to average net assets:
Net operating expenses	0.89% ³	0.88%	0.89%	0.89%	0.89%	0.89%
Gross operating expenses	0.89% ³	0.88%	0.89%	0.89%	0.89%	0.89%
Net investment income (loss)	2.65% ³	1.71%	1.47%	1.97%	1.89%	1.77%
Portfolio turnover rate	28% ²	73%	72%	64%	55%	31%
Net assets, end of period (x 1,000,000)	$1,681	$1,872	$2,053	$1,804	$1,390	$1,325

*	Unaudited.

Calculated based on the average shares outstanding during the period.

Not annualized.

Annualized (except for proxy costs).

See financial notes 25

Schwab Dividend Equity Fund

Portfolio Holdings as of April 30, 2016 (Unaudited)

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

Holdings by Category		Cost ($)	Value ($)
99.7%	Common Stock	1,576,974,273	1,675,853,807
0.2%	Short-Term Investment	3,730,860	3,730,860
99.9%	Total Investments	1,580,705,133	1,679,584,667
0.1%	Other Assets and Liabilities, Net		1,250,575
100.0%	Net Assets		1,680,835,242

Security	Number of Shares	Value ($)
Common Stock 99.7% of net assets
Automobiles & Components 1.4%
Ford Motor Co.	753,605	10,218,884
General Motors Co.	62,769	1,996,054
Lear Corp.	104,838	12,069,999
		24,284,937
Banks 12.0%
Bank of America Corp.	1,315,859	19,158,907
Citigroup, Inc.	1,265,513	58,567,942
Citizens Financial Group, Inc.	167,138	3,819,103
Fifth Third Bancorp	1,547,263	28,330,385
Huntington Bancshares, Inc.	430,000	4,325,800
JPMorgan Chase & Co.	1,100,975	69,581,620
MGIC Investment Corp. *	564,698	4,082,767
Radian Group, Inc.	273,791	3,501,787
Regions Financial Corp.	376,400	3,530,632
Wells Fargo & Co.	137,174	6,855,956
		201,754,899
Capital Goods 8.3%
AECOM *	30,050	976,325
Allison Transmission Holdings, Inc.	190,831	5,497,841
BWX Technologies, Inc.	282,691	9,439,052
Carlisle Cos., Inc.	242,327	24,693,121
Fluor Corp.	59,968	3,277,851
General Electric Co.	534,884	16,447,683
Huntington Ingalls Industries, Inc.	126,856	18,364,943
Illinois Tool Works, Inc.	41,648	4,353,049
Jacobs Engineering Group, Inc. *	72,872	3,248,634
KBR, Inc.	427,837	6,657,144
Kennametal, Inc.	72,048	1,684,482
Owens Corning	66,523	3,064,715

Security	Number of Shares	Value ($)
Quanta Services, Inc. *	40,972	971,856
Spirit AeroSystems Holdings, Inc., Class A *	251,634	11,864,543
Stanley Black & Decker, Inc.	230,843	25,835,949
The Toro Co.	29,052	2,511,545
		138,888,733
Commercial & Professional Supplies 1.4%
R.R. Donnelley & Sons Co.	1,307,128	22,744,027
Consumer Services 1.9%
Darden Restaurants, Inc.	388,504	24,184,374
Six Flags Entertainment Corp.	70,587	4,238,750
Vail Resorts, Inc.	31,113	4,033,489
		32,456,613
Diversified Financials 5.2%
Ally Financial, Inc. *	317,351	5,652,021
Berkshire Hathaway, Inc., Class B *	59,330	8,631,329
Discover Financial Services	159,301	8,963,867
Janus Capital Group, Inc.	304,748	4,449,321
Lazard Ltd., Class A	227,446	8,199,428
Morningstar, Inc.	12,765	1,062,048
Nasdaq, Inc.	44,619	2,753,439
Synchrony Financial *	443,546	13,559,201
The Bank of New York Mellon Corp.	144,429	5,811,823
Voya Financial, Inc.	898,634	29,178,646
		88,261,123
Energy 13.3%
California Resources Corp.	8,308	18,278
Chevron Corp.	376,315	38,451,867
ConocoPhillips	277,854	13,278,643
CVR Energy, Inc.	116,125	2,819,515
Devon Energy Corp.	225,859	7,832,790
Exxon Mobil Corp.	732,899	64,788,272
FMC Technologies, Inc. *	211,482	6,448,086
HollyFrontier Corp.	47,138	1,678,113
Marathon Petroleum Corp.	219,677	8,584,977
Murphy Oil Corp.	231,301	8,266,698
Noble Corp. plc	610,378	6,854,545
Occidental Petroleum Corp.	88,750	6,802,687
Patterson-UTI Energy, Inc.	461,111	9,106,942
Rowan Cos. plc, Class A	275,353	5,179,390
Schlumberger Ltd.	21,356	1,715,741
Superior Energy Services, Inc.	631,591	10,648,624
Tesoro Corp.	37,307	2,972,995
Valero Energy Corp.	373,363	21,979,880
Western Refining, Inc.	90,316	2,416,856
World Fuel Services Corp.	81,624	3,814,289
		223,659,188
Food & Staples Retailing 2.0%
The Kroger Co.	321,860	11,390,625
Wal-Mart Stores, Inc.	331,489	22,166,670
		33,557,295

26 See financial notes

Schwab Dividend Equity Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Food, Beverage & Tobacco 3.5%
Bunge Ltd.	166,582	10,411,375
ConAgra Foods, Inc.	232,492	10,359,844
Dr Pepper Snapple Group, Inc.	178,495	16,226,980
PepsiCo, Inc.	196,344	20,215,578
Tyson Foods, Inc., Class A	26,441	1,740,347
		58,954,124
Health Care Equipment & Services 5.3%
Allscripts Healthcare Solutions, Inc. *	432,551	5,796,183
AmerisourceBergen Corp.	251,024	21,362,142
C.R. Bard, Inc.	116,684	24,756,844
Cardinal Health, Inc.	230,054	18,050,037
Hologic, Inc. *	374,529	12,580,429
Molina Healthcare, Inc. *	128,619	6,657,320
		89,202,955
Household & Personal Products 0.8%
Spectrum Brands Holdings, Inc.	4,901	556,754
The Procter & Gamble Co.	154,319	12,364,038
		12,920,792
Insurance 4.6%
American Financial Group, Inc.	15,905	1,099,194
Aspen Insurance Holdings Ltd.	12,722	589,665
Axis Capital Holdings Ltd.	77,656	4,136,735
Everest Re Group Ltd.	10,792	1,995,441
Loews Corp.	152,851	6,065,128
MetLife, Inc.	264,412	11,924,981
Prudential Financial, Inc.	57,568	4,469,579
Reinsurance Group of America, Inc.	35,139	3,345,936
The Allstate Corp.	206,297	13,419,620
The Travelers Cos., Inc.	254,328	27,950,647
Unum Group	49,071	1,678,719
		76,675,645
Materials 4.1%
International Paper Co.	370,338	16,024,525
PolyOne Corp.	163,956	5,899,137
RPM International, Inc.	418,865	21,165,249
Steel Dynamics, Inc.	820,706	20,689,998
The Sherwin-Williams Co.	19,028	5,466,935
		69,245,844
Media 0.1%
Omnicom Group, Inc.	21,980	1,823,681
Pharmaceuticals, Biotechnology & Life Sciences 7.6%
Amgen, Inc.	129,338	20,474,205
Gilead Sciences, Inc.	143,953	12,698,094
Johnson & Johnson	146,248	16,391,476
Merck & Co., Inc.	514,894	28,236,787
Pfizer, Inc.	1,553,364	50,810,537
		128,611,099

Security	Number of Shares	Value ($)
Real Estate 5.5%
CBL & Associates Properties, Inc.	157,146	1,835,465
Empire State Realty Trust, Inc., Class A	91,647	1,696,386
Equity LifeStyle Properties, Inc.	186,727	12,788,932
Essex Property Trust, Inc.	6,306	1,390,158
Healthcare Trust of America, Inc., Class A	136,057	3,930,687
Kimco Realty Corp.	39,465	1,109,756
Lamar Advertising Co., Class A	313,370	19,441,475
Mid-America Apartment Communities, Inc.	55,341	5,296,687
Post Properties, Inc.	35,554	2,039,377
Prologis, Inc.	17,518	795,492
Retail Properties of America, Inc., Class A	505,926	8,089,757
Simon Property Group, Inc.	68,893	13,859,205
SL Green Realty Corp.	193,705	20,354,521
		92,627,898
Retailing 1.3%
Amazon.com, Inc. *	8,826	5,821,541
American Eagle Outfitters, Inc.	255,832	3,660,956
Best Buy Co., Inc.	156,519	5,021,130
Chico's FAS, Inc.	211,921	2,672,324
Lowe's Cos., Inc.	57,600	4,378,752
		21,554,703
Semiconductors & Semiconductor Equipment 2.1%
Intel Corp.	1,070,970	32,428,972
Teradyne, Inc.	140,305	2,653,167
		35,082,139
Software & Services 3.3%
Citrix Systems, Inc. *	56,837	4,651,540
Computer Sciences Corp.	282,796	9,369,032
Leidos Holdings, Inc.	321,465	15,947,879
Microsoft Corp.	386,090	19,254,308
Nuance Communications, Inc. *	192,002	3,298,594
Xerox Corp.	258,734	2,483,846
		55,005,199
Technology Hardware & Equipment 3.7%
Apple, Inc.	222,071	20,816,935
Cisco Systems, Inc.	883,316	24,282,357
Hewlett Packard Enterprise Co.	76,465	1,273,907
HP, Inc.	497,396	6,103,049
Jabil Circuit, Inc.	408,246	7,087,150
Juniper Networks, Inc.	74,649	1,746,787
SYNNEX Corp.	8,209	677,817
		61,988,002
Telecommunication Services 1.3%
AT&T, Inc.	147,631	5,731,035
Verizon Communications, Inc.	303,990	15,485,251
		21,216,286

See financial notes 27

Schwab Dividend Equity Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Transportation 2.5%
Delta Air Lines, Inc.	470,316	19,598,068
United Parcel Service, Inc., Class B	217,206	22,821,834
		42,419,902
Utilities 8.5%
American Electric Power Co., Inc.	297,295	18,878,232
CenterPoint Energy, Inc.	927,982	19,905,214
Entergy Corp.	456,216	34,298,319
Exelon Corp.	193,822	6,801,214
FirstEnergy Corp.	475,926	15,510,428
UGI Corp.	860,733	34,635,896
Xcel Energy, Inc.	321,994	12,889,420
		142,918,723
Total Common Stock
(Cost $1,576,974,273)		1,675,853,807
Security Rate, Maturity Date	Face Amount ($)	Value ($)
Short-Term Investment 0.2% of net assets
Time Deposit 0.2%
Sumitomo Mitsui Banking Corp.
0.15%, 05/02/16 (a)	3,730,860	3,730,860
Total Short-Term Investment
(Cost $3,730,860)		3,730,860

End of Investments.

At 04/30/16, the tax basis cost of the fund's investments was $1,580,705,169 and the unrealized appreciation and depreciation were $178,624,642 and ($79,745,144), respectively, with a net unrealized appreciation of $98,879,498.

*	Non-income producing security.
(a)	The rate shown is the current daily overnight rate.

The following is a summary of the inputs used to value the fund's investments as of April 30, 2016 (see financial note 2(a) for additional information):

Description	Quoted Prices in Active Markets for Identical Assets (Level 1)	Other Significant Observable Inputs (Level 2)	Significant Unobservable Inputs (Level 3)	Total
Common Stock¹	$1,675,853,807	$—	$—	$1,675,853,807
Short-Term Investment¹	—	3,730,860	—	3,730,860
Total	$1,675,853,807	$3,730,860	$—	$1,679,584,667

¹	As categorized in Portfolio Holdings.

28 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
	11/1/15-4/30/16		11/1/14-10/31/15
Net investment income		$22,593,227	$33,911,486
Net realized gains (losses)		(30,272,342)	194,016,375
Net change in unrealized appreciation (depreciation)	+	(22,016,906)	(221,097,083)
Increase (decrease) in net assets from operations		(29,696,021)	6,830,778
Distributions to Shareholders
Distributions from net investment income		(22,178,645)	(31,258,036)
Distributions from net realized gains	+	(195,568,378)	(272,348,613)
Total distributions		($217,747,023)	($303,606,649)

Transactions in Fund Shares
		11/1/15-4/30/16		11/1/14-10/31/15
		SHARES	VALUE	SHARES	VALUE
Shares sold		7,033,127	$97,936,211	14,692,885	$248,859,127
Shares reinvested		10,557,354	151,366,960	12,419,993	210,709,144
Shares redeemed	+	(13,652,542)	(192,907,749)	(20,322,510)	(344,140,463)
Net transactions in fund shares		3,937,939	$56,395,422	6,790,368	$115,427,808
Shares Outstanding and Net Assets
		11/1/15-4/30/16		11/1/14-10/31/15
		SHARES	NET ASSETS	SHARES	NET ASSETS
Beginning of period		113,914,626	$1,871,882,864	107,124,258	$2,053,230,927
Total increase or decrease	+	3,937,939	(191,047,622)	6,790,368	(181,348,063)
End of period		117,852,565	$1,680,835,242	113,914,626	$1,871,882,864
Net investment income not yet distributed			$1,001,794		$587,212

See financial notes 31

Schwab Large-Cap Growth Fund

Financial Statements

Financial Highlights

	11/1/15– 4/30/16*	11/1/14– 10/31/15	11/1/13– 10/31/14	11/1/12– 10/31/13	11/1/11– 10/31/12	11/1/10– 10/31/11
Per-Share Data
Net asset value at beginning of period	$17.68	$18.38	$15.66	$12.48	$11.18	$10.48
Income (loss) from investment operations:
Net investment income (loss)	0.11 ¹	0.13 ¹	0.11	0.14	0.07	0.07
Net realized and unrealized gains (losses)	(0.64)	1.08	2.70	3.17	1.29	0.69
Total from investment operations	(0.53)	1.21	2.81	3.31	1.36	0.76
Less distributions:
Distributions from net investment income	(0.20)	(0.09)	(0.09)	(0.13)	(0.06)	(0.06)
Distributions from net realized gains	(2.36)	(1.82)	—	—	—	—
Total distributions	(2.56)	(1.91)	(0.09)	(0.13)	(0.06)	(0.06)
Net asset value at end of period	$14.59	$17.68	$18.38	$15.66	$12.48	$11.18
Total return	(3.49%) ²	7.00%	18.06%	26.76%	12.18%	7.25%
Ratios/Supplemental Data
Ratios to average net assets:
Net operating expenses	1.00% ³^,⁴	0.99%	0.99%	0.99%	0.99%	0.99%
Gross operating expenses	1.05% ³	1.03%	1.04%	1.05%	1.05%	1.05%
Net investment income (loss)	1.48% ³	0.75%	0.60%	1.00%	0.53%	0.56%
Portfolio turnover rate	33% ²	90%	82%	87%	79%	62%
Net assets, end of period (x 1,000,000)	$224	$251	$256	$253	$217	$213

*	Unaudited.

Calculated based on the average shares outstanding during the period.

Not annualized.

Annualized (except for proxy costs).

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, 2016 (Unaudited)

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

Holdings by Category		Cost ($)	Value ($)
99.9%	Common Stock	203,497,987	223,401,551
99.9%	Total Investments	203,497,987	223,401,551
0.1%	Other Assets and Liabilities, Net		328,121
100.0%	Net Assets		223,729,672

Security	Number of Shares	Value ($)
Common Stock 99.9% of net assets
Automobiles & Components 1.4%
Lear Corp.	26,517	3,052,902
Banks 2.0%
Citigroup, Inc.	49,643	2,297,478
MGIC Investment Corp. *	24,964	180,490
Radian Group, Inc.	152,438	1,949,682
		4,427,650
Capital Goods 7.7%
AECOM *	7,793	253,195
Babcock & Wilcox Enterprises, Inc. *	6,252	142,858
BWX Technologies, Inc.	125,021	4,174,451
Carlisle Cos., Inc.	42,938	4,375,382
Huntington Ingalls Industries, Inc.	20,074	2,906,113
Owens Corning	14,991	690,635
Spirit AeroSystems Holdings, Inc., Class A *	75,844	3,576,045
The Toro Co.	13,877	1,199,667
		17,318,346
Commercial & Professional Supplies 1.4%
R.R. Donnelley & Sons Co.	177,400	3,086,760
Consumer Durables & Apparel 1.3%
Carter's, Inc.	3,654	389,772
Michael Kors Holdings Ltd. *	27,132	1,401,639
Wolverine World Wide, Inc.	63,229	1,198,190
		2,989,601

Security	Number of Shares	Value ($)
Consumer Services 2.9%
Darden Restaurants, Inc.	57,752	3,595,062
Six Flags Entertainment Corp.	12,888	773,925
Vail Resorts, Inc.	15,574	2,019,013
		6,388,000
Diversified Financials 1.7%
Ally Financial, Inc. *	77,464	1,379,634
Voya Financial, Inc.	77,036	2,501,359
		3,880,993
Energy 1.2%
CVR Energy, Inc.	12,427	301,727
FMC Technologies, Inc. *	30,714	936,470
Tesoro Corp.	5,852	466,346
Valero Energy Corp.	15,632	920,256
		2,624,799
Food & Staples Retailing 2.0%
The Kroger Co.	124,839	4,418,052
Food, Beverage & Tobacco 8.0%
Altria Group, Inc.	10,957	687,113
Bunge Ltd.	19,749	1,234,312
Campbell Soup Co.	20,318	1,253,824
ConAgra Foods, Inc.	29,578	1,317,996
Dr Pepper Snapple Group, Inc.	48,571	4,415,590
PepsiCo, Inc.	73,369	7,554,072
Post Holdings, Inc. *	8,393	602,953
Tyson Foods, Inc., Class A	11,906	783,653
		17,849,513
Health Care Equipment & Services 7.3%
Allscripts Healthcare Solutions, Inc. *	49,719	666,235
AmerisourceBergen Corp.	52,949	4,505,960
C.R. Bard, Inc.	17,619	3,738,223
Cardinal Health, Inc.	23,081	1,810,935
Express Scripts Holding Co. *	1,972	145,395
Hologic, Inc. *	107,179	3,600,143
Molina Healthcare, Inc. *	37,421	1,936,911
		16,403,802
Insurance 1.6%
American Financial Group, Inc.	34,328	2,372,408
Reinsurance Group of America, Inc.	12,017	1,144,259
		3,516,667
Materials 2.8%
Cabot Corp.	28,083	1,370,170
RPM International, Inc.	59,088	2,985,717
Steel Dynamics, Inc.	76,421	1,926,573
		6,282,460

See financial notes 33

Schwab Large-Cap Growth Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Media 6.0%
Comcast Corp., Class A	117,434	7,135,290
Live Nation Entertainment, Inc. *	18,347	394,094
Omnicom Group, Inc.	56,624	4,698,093
Scripps Networks Interactive, Inc., Class A	11,277	703,121
The Interpublic Group of Cos., Inc.	18,266	419,022
		13,349,620
Pharmaceuticals, Biotechnology & Life Sciences 9.3%
AbbVie, Inc.	52,782	3,219,702
Amgen, Inc.	39,275	6,217,233
Bruker Corp.	31,316	886,243
Eli Lilly & Co.	3,463	261,560
Gilead Sciences, Inc.	53,298	4,701,417
Jazz Pharmaceuticals plc *	4,412	664,888
Johnson & Johnson	7,654	857,860
Merck & Co., Inc.	52,639	2,886,723
Myriad Genetics, Inc. *	6,512	234,432
VWR Corp. *	4,346	115,777
Zoetis, Inc.	14,806	696,326
		20,742,161
Real Estate 2.5%
Empire State Realty Trust, Inc., Class A	40,791	755,042
Equity LifeStyle Properties, Inc.	7,170	491,073
Lamar Advertising Co., Class A	70,832	4,394,417
		5,640,532
Retailing 9.3%
Amazon.com, Inc. *	13,697	9,034,404
American Eagle Outfitters, Inc.	14,361	205,506
Best Buy Co., Inc.	44,825	1,437,986
Chico's FAS, Inc.	45,151	569,354
Genuine Parts Co.	2,819	270,539
Lowe's Cos., Inc.	73,493	5,586,938
Target Corp.	18,320	1,456,440
The Home Depot, Inc.	17,145	2,295,544
		20,856,711
Semiconductors & Semiconductor Equipment 1.5%
Intel Corp.	47,878	1,449,746
Microsemi Corp. *	46,958	1,586,711
Teradyne, Inc.	14,885	281,475
		3,317,932
Software & Services 18.1%
Alphabet, Inc., Class A *	12,427	8,796,825
Citrix Systems, Inc. *	13,954	1,141,995
Computer Sciences Corp.	78,527	2,601,599

Security	Number of Shares	Value ($)
CoreLogic, Inc. *	12,603	447,154
eBay, Inc. *	8,983	219,455
Facebook, Inc., Class A *	43,557	5,121,432
GoDaddy, Inc., Class A *	25,829	784,427
Leidos Holdings, Inc.	82,978	4,116,538
Mentor Graphics Corp.	33,110	660,876
Microsoft Corp.	70,461	3,513,890
Nuance Communications, Inc. *	166,071	2,853,100
Rackspace Hosting, Inc. *	11,954	273,388
Sabre Corp.	8,960	259,392
Take-Two Interactive Software, Inc. *	46,910	1,603,384
Teradata Corp. *	64,313	1,627,119
The Western Union Co.	24,819	496,380
Vantiv, Inc., Class A *	69,172	3,772,641
Visa, Inc., Class A	14,725	1,137,359
Xerox Corp.	115,820	1,111,872
		40,538,826
Technology Hardware & Equipment 5.9%
Apple, Inc.	121,568	11,395,784
Ciena Corp. *	89,542	1,506,992
Cisco Systems, Inc.	2,958	81,316
SYNNEX Corp.	2,744	226,572
		13,210,664
Telecommunication Services 1.1%
Verizon Communications, Inc.	49,234	2,507,980
Transportation 2.9%
Alaska Air Group, Inc.	7,796	549,072
Delta Air Lines, Inc.	104,967	4,373,975
JetBlue Airways Corp. *	19,365	383,234
Matson, Inc.	16,324	634,677
United Parcel Service, Inc., Class B	5,429	570,425
		6,511,383
Utilities 2.0%
FirstEnergy Corp.	20,951	682,793
UGI Corp.	94,518	3,803,404
		4,486,197
Total Common Stock
(Cost $203,497,987)		223,401,551

End of Investments.

At 04/30/16, the tax basis cost of the fund's investments was $203,498,004 and the unrealized appreciation and depreciation were $30,183,897 and ($10,280,350), respectively, with a net unrealized appreciation of $19,903,547.

*	Non-income producing security.

34 See financial notes

Schwab Small-Cap Equity Fund

Financial Statements

Financial Highlights

	11/1/15– 4/30/16*	11/1/14– 10/31/15	11/1/13– 10/31/14	11/1/12– 10/31/13	11/1/11– 10/31/12	11/1/10– 10/31/11
Per-Share Data
Net asset value at beginning of period	$21.19	$25.11	$24.87	$17.72	$15.61	$13.96
Income (loss) from investment operations:
Net investment income (loss)	0.05 ¹	0.05 ¹	(0.02)	0.09	0.02	(0.01)
Net realized and unrealized gains (losses)	(0.73)	0.63	2.71	7.16	2.10	1.66
Total from investment operations	(0.68)	0.68	2.69	7.25	2.12	1.65
Less distributions:
Distributions from net investment income	(0.04)	(0.02)	(0.07)	(0.10)	(0.01)	—
Distributions from net realized gains	(2.53)	(4.58)	(2.38)	—	—	—
Total distributions	(2.57)	(4.60)	(2.45)	(0.10)	(0.01)	—
Net asset value at end of period	$17.94	$21.19	$25.11	$24.87	$17.72	$15.61
Total return	(3.23%) ²	3.01%	11.67%	41.10%	13.57%	11.82%
Ratios/Supplemental Data
Ratios to average net assets:
Net operating expenses	1.10% ³	1.09%	1.10%	1.10%	1.12%	1.11%
Gross operating expenses	1.10% ³	1.09%	1.10%	1.11%	1.12%	1.12%
Net investment income (loss)	0.55% ³	0.22%	(0.10%)	0.42%	0.11%	(0.05%)
Portfolio turnover rate	38% ²	95%	103%	84%	101%	72%
Net assets, end of period (x 1,000,000)	$588	$630	$666	$590	$388	$226

*	Unaudited.

Calculated based on the average shares outstanding during the period.

Not annualized.

Annualized (except for proxy costs).

See financial notes 39

Schwab Small-Cap Equity Fund

Portfolio Holdings as of April 30, 2016 (Unaudited)

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

Holdings by Category		Cost ($)	Value ($)
99.3%	Common Stock	574,670,754	583,397,853
3.7%	Other Investment Company	21,775,839	21,775,839
0.4%	Short-Term Investment	2,174,490	2,174,490
103.4%	Total Investments	598,621,083	607,348,182
(3.4%)	Other Assets and Liabilities, Net		(19,804,666)
100.0%	Net Assets		587,543,516

Security	Number of Shares	Value ($)
Common Stock 99.3% of net assets
Automobiles & Components 2.5%
American Axle & Manufacturing Holdings, Inc. *	377,959	5,862,144
Dana Holding Corp.	149,855	1,937,625
Tenneco, Inc. *	124,196	6,619,647
		14,419,416
Banks 10.4%
1st Source Corp.	35,101	1,208,878
Banc of California, Inc.	281,820	5,735,037
BancFirst Corp.	13,210	823,908
Camden National Corp.	14,621	636,160
CenterState Banks, Inc.	9,039	147,245
Central Pacific Financial Corp.	7,126	166,321
Chemical Financial Corp.	4,588	176,454
Community Trust Bancorp, Inc.	4,493	161,164
Enterprise Financial Services Corp.	5,349	146,402
Essent Group Ltd. *	171,109	3,494,046
Farmers Capital Bank Corp.	2,672	75,110
Federal Agricultural Mortgage Corp., Class C	71,919	2,925,665
Financial Institutions, Inc.	5,385	150,780
First Bancorp (North Carolina)	14,300	291,720
First BanCorp (Puerto Rico) *	1,059,719	4,132,904
First Citizens BancShares, Inc., Class A	4,287	1,093,185
First Community Bancshares, Inc.	27,051	562,931
First Defiance Financial Corp.	10,948	433,322
First Financial Corp.	51,845	1,836,868
First Interstate BancSystem, Inc., Class A	28,960	784,816
First Midwest Bancorp, Inc.	7,437	137,436

Security	Number of Shares	Value ($)
Great Southern Bancorp, Inc.	5,287	200,166
Great Western Bancorp, Inc.	73,760	2,324,915
Heartland Financial USA, Inc.	17,026	570,541
International Bancshares Corp.	164,585	4,310,481
MainSource Financial Group, Inc.	29,140	636,709
MGIC Investment Corp. *	766,064	5,538,643
MidWestOne Financial Group, Inc.	2,163	61,343
NBT Bancorp, Inc.	7,853	222,554
Opus Bank	3,911	141,265
Preferred Bank	31,993	1,016,098
Radian Group, Inc.	454,710	5,815,741
Republic Bancorp, Inc., Class A	40,136	1,096,114
Sierra Bancorp	27,373	482,038
Synovus Financial Corp.	33,960	1,058,194
TCF Financial Corp.	467,616	6,378,282
TriState Capital Holdings, Inc. *	26,875	359,050
Triumph Bancorp, Inc. *	34,457	547,522
United Community Banks, Inc.	187,305	3,770,450
Waterstone Financial, Inc.	46,541	652,505
WSFS Financial Corp.	14,072	480,418
		60,783,381
Capital Goods 7.7%
Accuride Corp. *	167,189	270,846
Aegion Corp. *	20,007	424,749
Aerojet Rocketdyne Holdings, Inc. *	118,180	2,141,422
Allied Motion Technologies, Inc.	2,130	45,902
Altra Industrial Motion Corp.	20,400	585,480
BWX Technologies, Inc.	171,902	5,739,808
Comfort Systems USA, Inc.	61,944	1,826,729
Commercial Vehicle Group, Inc. *	66,418	170,694
Cubic Corp.	19,275	801,262
EMCOR Group, Inc.	103,646	5,024,758
General Cable Corp.	211,465	3,307,313
Global Brass & Copper Holdings, Inc.	97,379	2,638,971
Hurco Cos., Inc.	9,200	297,896
John Bean Technologies Corp.	87,360	4,554,950
Kadant, Inc.	20,540	972,569
L.B. Foster Co., Class A	10,746	211,481
MasTec, Inc. *	8,386	190,027
Meritor, Inc. *	210,226	1,786,921
Moog, Inc., Class A *	32,357	1,580,963
National Presto Industries, Inc.	13,791	1,202,437
The Greenbrier Cos., Inc. (a)	76,756	2,301,912
Vectrus, Inc. *	92,604	1,996,542
Wabash National Corp. *	509,661	7,262,669
		45,336,301
Commercial & Professional Supplies 3.9%
ACCO Brands Corp. *	53,714	512,431
ARC Document Solutions, Inc. *	30,710	126,525
Deluxe Corp.	30,273	1,900,539
Ennis, Inc.	189,823	3,709,141
Heidrick & Struggles International, Inc.	53,646	1,058,436
Interface, Inc.	46,237	786,954
Kforce, Inc.	41,508	789,067
Quad Graphics, Inc.	485,387	6,091,607

40 See financial notes

Schwab Small-Cap Equity Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
The Brink's Co.	173,420	5,868,533
TrueBlue, Inc. *	104,891	1,960,413
		22,803,646
Consumer Durables & Apparel 1.5%
CSS Industries, Inc.	20,620	576,535
Culp, Inc.	30,041	788,276
JAKKS Pacific, Inc. *(a)	393,593	2,951,948
Johnson Outdoors, Inc., Class A	7,100	171,323
Libbey, Inc.	44,244	822,938
NACCO Industries, Inc., Class A	6,561	390,511
Nautilus, Inc. *	47,323	834,778
Perry Ellis International, Inc. *	112,646	2,145,906
ZAGG, Inc. *	30,831	246,956
		8,929,171
Consumer Services 3.7%
Ascent Capital Group, Inc., Class A *	43,779	659,749
Bloomin' Brands, Inc.	219,298	4,100,873
Brinker International, Inc.	62,978	2,917,141
Capella Education Co.	19,655	1,087,118
Carrols Restaurant Group, Inc. *	100,190	1,393,643
Diamond Resorts International, Inc. *(a)	122,281	2,593,580
Isle of Capri Casinos, Inc. *	164,972	2,458,083
K12, Inc. *	223,431	2,745,967
Regis Corp. *	122,556	1,675,340
Ruby Tuesday, Inc. *	142,609	627,480
Strayer Education, Inc. *	34,996	1,737,201
		21,996,175
Diversified Financials 3.0%
Calamos Asset Management, Inc., Class A	78,751	648,908
GAIN Capital Holdings, Inc.	93,629	641,359
Interactive Brokers Group, Inc., Class A	140,190	5,327,220
KCG Holdings, Inc., Class A *	521,624	7,146,249
Marlin Business Services Corp.	39,303	581,291
Nelnet, Inc., Class A	29,304	1,228,131
Regional Management Corp. *	97,682	1,613,707
Westwood Holdings Group, Inc.	3,268	188,073
World Acceptance Corp. *(a)	11,133	483,061
		17,857,999
Energy 3.5%
Alon USA Energy, Inc.	313,065	3,287,182
Archrock, Inc.	163,484	1,610,317
Atwood Oceanics, Inc. (a)	67,050	647,703
Cloud Peak Energy, Inc. *	95,161	210,306
CVR Energy, Inc.	54,440	1,321,803
Delek US Holdings, Inc.	5,514	87,617
Exterran Corp. *	14,594	223,288
Matrix Service Co. *	126,707	2,387,160
McDermott International, Inc. *	33,315	151,250
Natural Gas Services Group, Inc. *	5,346	122,905
Navios Maritime Acquisition Corp.	106,690	205,912
Par Pacific Holdings, Inc. *	57,645	1,101,596
Parker Drilling Co. *	276,630	846,488

Security	Number of Shares	Value ($)
Pioneer Energy Services Corp. *	459,778	1,429,910
RigNet, Inc. *	18,195	311,135
Teekay Corp.	91,241	1,021,899
TETRA Technologies, Inc. *	486,041	3,499,495
Western Refining, Inc.	80,101	2,143,503
		20,609,469
Food & Staples Retailing 0.9%
SpartanNash, Co.	97,434	2,698,921
SUPERVALU, Inc. *	442,562	2,226,087
Village Super Market, Inc., Class A	24,752	603,949
		5,528,957
Food, Beverage & Tobacco 2.8%
Cal-Maine Foods, Inc. (a)	77,115	3,914,357
Darling Ingredients, Inc. *	36,461	528,320
Dean Foods Co.	377,654	6,506,978
Farmer Brothers Co. *	73,417	2,217,928
Fresh Del Monte Produce, Inc.	3,985	172,391
John B. Sanfilippo & Son, Inc.	30,010	1,660,453
Universal Corp.	24,921	1,359,441
		16,359,868
Health Care Equipment & Services 4.8%
Accuray, Inc. *	194,805	1,044,155
Alliance HealthCare Services, Inc. *	8,250	59,317
Allscripts Healthcare Solutions, Inc. *	369,990	4,957,866
AngioDynamics, Inc. *	19,638	240,565
Atrion Corp.	172	68,336
Cantel Medical Corp.	1,824	122,190
Civitas Solutions, Inc. *	19,759	395,970
Cross Country Healthcare, Inc. *	20,645	256,617
CryoLife, Inc.	7,332	90,917
Cynosure, Inc., Class A *	7,020	343,559
Exactech, Inc. *	14,757	335,574
Five Star Quality Care, Inc. *	42,845	104,542
Haemonetics Corp. *	94,841	3,075,694
Inogen, Inc. *	9,450	461,727
Integra LifeSciences Holdings Corp. *	48,337	3,423,226
Invacare Corp.	8,848	99,452
Merit Medical Systems, Inc. *	162,014	3,280,783
Molina Healthcare, Inc. *	7,134	369,256
National HealthCare Corp.	8,700	560,715
Natus Medical, Inc. *	3,688	117,537
NxStage Medical, Inc. *	165,194	2,662,927
Quality Systems, Inc.	112,365	1,582,099
RadNet, Inc. *	322,538	1,628,817
RTI Surgical, Inc. *	95,298	380,239
SurModics, Inc. *	54,803	1,102,636
Triple-S Management Corp., Class B *	59,765	1,556,281
Utah Medical Products, Inc.	1,991	133,198
		28,454,195
Household & Personal Products 0.3%
Central Garden & Pet Co., Class A *	9,964	162,314
Natural Health Trends Corp. (a)	2,650	95,903

See financial notes 41

Schwab Small-Cap Equity Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Oil-Dri Corp. of America	4,619	154,090
USANA Health Sciences, Inc. *	13,528	1,602,256
		2,014,563
Insurance 2.3%
Ambac Financial Group, Inc. *	11,023	178,903
American Equity Investment Life Holding Co.	162,970	2,281,580
Employers Holdings, Inc.	8,609	255,687
Hallmark Financial Services, Inc. *	7,085	79,990
Heritage Insurance Holdings, Inc.	93,004	1,236,023
Maiden Holdings Ltd.	421,358	5,153,208
National Western Life Group, Inc., Class A	5,980	1,295,866
Selective Insurance Group, Inc.	82,967	2,879,785
		13,361,042
Materials 2.0%
AEP Industries, Inc.	25,706	1,584,261
Chase Corp.	2,598	146,241
Domtar Corp.	1,258	48,609
Innospec, Inc.	8,039	388,766
Koppers Holdings, Inc. *	135,275	3,399,461
OMNOVA Solutions, Inc. *	33,533	239,761
SunCoke Energy, Inc.	107,342	797,551
Tredegar Corp.	25,888	413,172
Trinseo S.A. *	113,426	4,853,499
		11,871,321
Media 0.9%
New Media Investment Group, Inc.	133,488	2,142,482
Sinclair Broadcast Group, Inc., Class A	36,226	1,161,768
Starz, Class A *	57,344	1,560,330
World Wrestling Entertainment, Inc., Class A (a)	13,240	220,314
		5,084,894
Pharmaceuticals, Biotechnology & Life Sciences 11.3%
Acorda Therapeutics, Inc. *	159,260	4,116,871
Aegerion Pharmaceuticals, Inc. *	163,728	466,625
AMAG Pharmaceuticals, Inc. *	120,616	3,198,736
BioSpecifics Technologies Corp. *	36,710	1,305,408
Catalent, Inc. *	200,933	5,933,552
Cepheid *	72,182	2,060,074
Concert Pharmaceuticals, Inc. *	17,504	244,006
Depomed, Inc. *	77,740	1,351,121
Emergent BioSolutions, Inc. *	161,176	6,208,500
Enanta Pharmaceuticals, Inc. *	56,897	1,661,392
Five Prime Therapeutics, Inc. *	8,480	403,563
Genomic Health, Inc. *	14,921	392,124
Halozyme Therapeutics, Inc. *	8,126	85,729
Heska Corp. *	8,326	254,776
Impax Laboratories, Inc. *	51,023	1,701,617
INC Research Holdings, Inc., Class A *	92,261	4,440,522
Insys Therapeutics, Inc. *(a)	70,533	1,022,023
Ligand Pharmaceuticals, Inc. *	10,482	1,266,959
Momenta Pharmaceuticals, Inc. *	63,393	602,867

Security	Number of Shares	Value ($)
Myriad Genetics, Inc. *	160,661	5,783,796
PAREXEL International Corp. *	29,487	1,801,656
PDL BioPharma, Inc.	396,033	1,493,044
Phibro Animal Health Corp., Class A	118,344	2,454,455
Prestige Brands Holdings, Inc. *	99,798	5,666,531
Repligen Corp. *	53,935	1,436,828
SciClone Pharmaceuticals, Inc. *	221,102	2,918,546
Spectrum Pharmaceuticals, Inc. *	669,218	4,744,756
Sucampo Pharmaceuticals, Inc., Class A *	117,155	1,262,931
Vanda Pharmaceuticals, Inc. *	225,626	2,008,071
		66,287,079
Real Estate 9.4%
Brandywine Realty Trust	123,499	1,846,310
CBL & Associates Properties, Inc.	4,922	57,489
CoreSite Realty Corp.	92,437	6,926,304
CyrusOne, Inc.	102,200	4,510,086
Empire State Realty Trust, Inc., Class A	349,063	6,461,156
First Industrial Realty Trust, Inc.	320,329	7,348,347
Healthcare Realty Trust, Inc.	143,716	4,351,721
Mack-Cali Realty Corp.	290,694	7,430,139
RE/MAX Holdings, Inc., Class A	175,853	6,471,390
Saul Centers, Inc.	53,832	2,862,786
Summit Hotel Properties, Inc.	527,475	6,013,215
Sunstone Hotel Investors, Inc.	57,426	735,627
		55,014,570
Retailing 3.5%
Build-A-Bear Workshop, Inc. *	55,236	727,458
Chico's FAS, Inc.	258,590	3,260,820
Citi Trends, Inc.	35,131	630,953
Express, Inc. *	208,374	3,788,239
GameStop Corp., Class A	69,951	2,294,393
Kirkland's, Inc.	46,408	762,019
Outerwall, Inc. (a)	115,282	4,762,299
Rent-A-Center, Inc.	212,193	3,119,237
The Children's Place, Inc.	10,390	809,485
Tilly's, Inc., Class A *	79,209	498,225
		20,653,128
Semiconductors & Semiconductor Equipment 3.6%
Advanced Energy Industries, Inc. *	171,100	5,535,085
Cohu, Inc.	119,403	1,380,299
FormFactor, Inc. *	280,883	2,162,799
IXYS Corp.	107,621	1,162,307
Microsemi Corp. *	131,303	4,436,728
Photronics, Inc. *	240,760	2,547,241
Synaptics, Inc. *	11,027	788,982
Tessera Technologies, Inc.	111,031	3,188,810
		21,202,251
Software & Services 10.4%
ACI Worldwide, Inc. *	48,959	978,690
AVG Technologies N.V. *	254,826	5,045,555
Carbonite, Inc. *	6,538	49,297
Cardtronics, Inc. *	37,490	1,477,856
Cornerstone OnDemand, Inc. *	17,756	609,919

42 See financial notes

Schwab Small-Cap Equity Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
CSG Systems International, Inc.	21,801	967,528
DHI Group, Inc. *	341,856	2,430,596
EarthLink Holdings Corp.	770,988	4,479,440
Epiq Systems, Inc.	65,465	966,918
Everi Holdings, Inc. *	51,542	86,591
Fleetmatics Group plc *	91,543	3,318,434
GoDaddy, Inc., Class A *	122,561	3,722,178
GTT Communications, Inc. *	9,647	154,159
Internap Corp. *	20,226	46,115
Intralinks Holdings, Inc. *	111,799	996,129
j2 Global, Inc.	72,427	4,600,563
Mentor Graphics Corp.	109,689	2,189,392
MicroStrategy, Inc., Class A *	25,857	4,636,677
Monster Worldwide, Inc. *	523,134	1,674,029
NeuStar, Inc., Class A *(a)	201,197	4,726,118
Pegasystems, Inc.	228,946	6,041,885
Progress Software Corp. *	188,100	4,800,312
QAD, Inc., Class A	34,750	681,447
QuinStreet, Inc. *	20,184	71,048
Sykes Enterprises, Inc. *	51,931	1,513,789
United Online, Inc. *	9,584	103,795
Web.com Group, Inc. *	213,758	4,273,022
WebMD Health Corp. *	2,806	176,048
Zix Corp. *	73,733	275,024
		61,092,554
Technology Hardware & Equipment 4.5%
Bel Fuse, Inc., Class B	19,212	320,072
Black Box Corp.	94,886	1,387,233
Ciena Corp. *	76,965	1,295,321
Eastman Kodak Co. *	7,598	89,808
Electronics For Imaging, Inc. *	41,724	1,662,284
Extreme Networks, Inc. *	59,252	207,975
Insight Enterprises, Inc. *	234,131	5,785,377
Ixia *	108,864	1,101,704
Lexmark International, Inc., Class A	85,757	3,310,220
Methode Electronics, Inc.	6,472	192,413
NETGEAR, Inc. *	141,825	6,013,380
Sanmina Corp. *	53,051	1,254,656
SYNNEX Corp.	22,977	1,897,211
Tech Data Corp. *	11,942	820,296
TTM Technologies, Inc. *	136,641	890,899
		26,228,849
Telecommunication Services 1.5%
FairPoint Communications, Inc. *	150,966	2,001,809
General Communication, Inc., Class A *	220,922	3,733,582
Hawaiian Telcom Holdco, Inc. *	8,245	189,882
IDT Corp., Class B	88,037	1,350,488
Inteliquent, Inc.	40,647	674,334
Spok Holdings, Inc.	38,190	648,848
Vonage Holdings Corp. *	60,400	282,068
		8,881,011
Transportation 3.2%
Air Transport Services Group, Inc. *	123,440	1,739,270
Allegiant Travel Co.	11,505	1,847,358
ArcBest Corp.	56,932	1,086,832
Atlas Air Worldwide Holdings, Inc. *	25,462	1,016,952

Security	Number of Shares	Value ($)
Hawaiian Holdings, Inc. *	115,037	4,839,606
Matson, Inc.	103,034	4,005,962
Park-Ohio Holdings Corp.	17,497	445,299
SkyWest, Inc.	65,970	1,550,295
YRC Worldwide, Inc. *	251,369	2,312,595
		18,844,169
Utilities 1.7%
American States Water Co.	33,422	1,393,363
Atlantic Power Corp.	466,149	1,239,956
Consolidated Water Co., Ltd.	16,109	223,754
Dynegy, Inc. *	5,942	104,758
NRG Yield, Inc., Class A	49,916	755,229
Southwest Gas Corp.	81,640	5,299,253
Talen Energy Corp. *	65,826	767,531
		9,783,844
Total Common Stock
(Cost $574,670,754)		583,397,853

Other Investment Company 3.7% of net assets
Securities Lending Collateral 3.7%
Wells Fargo Advantage Government Money Market Fund, Select Class 0.23% (b)	21,775,839	21,775,839
Total Other Investment Company
(Cost $21,775,839)		21,775,839
Security Rate, Maturity Date	Face Amount ($)	Value ($)
Short-Term Investment 0.4% of net assets
Time Deposits 0.4%
Sumitomo Mitsui Banking Corp.
0.15%, 05/02/16 (c)	2,174,490	2,174,490
Total Short-Term Investment
(Cost $2,174,490)		2,174,490

End of Investments.

At 04/30/16, the tax basis cost of the fund's investments was $599,349,827 and the unrealized appreciation and depreciation were $68,574,668 and ($60,576,313), respectively, with a net unrealized appreciation of $7,998,355.

*	Non-income producing security.
(a)	All or a portion of this security is on loan. Securities on loan were valued at $21,109,984.
(b)	The rate shown is the 7-day yield.
(c)	The rate shown is the current daily overnight rate.

See financial notes 43

Schwab Hedged Equity Fund

Financial Statements

Financial Highlights

	11/1/15– 4/30/16*	11/1/14– 10/31/15	11/1/13– 10/31/14	11/1/12– 10/31/13	11/1/11– 10/31/12	11/1/10– 10/31/11
Per-Share Data
Net asset value at beginning of period	$17.46	$19.02	$18.62	$16.36	$15.32	$14.79
Income (loss) from investment operations:
Net investment income (loss)	0.06 ¹	(0.01) ¹	(0.08)	(0.10)	(0.08)	(0.05)
Net realized and unrealized gains (losses)	(0.31)	0.89	1.99	2.36	1.12	0.58
Total from investment operations	(0.25)	0.88	1.91	2.26	1.04	0.53
Less distributions:
Distributions from net investment income	(0.12)	—	—	—	—	—
Distributions from net realized gains	(1.61)	(2.44)	(1.51)	—	—	—
Total distributions	(1.73)	(2.44)	(1.51)	—	—	—
Net asset value at end of period	$15.48	$17.46	$19.02	$18.62	$16.36	$15.32
Total return	(1.36%) ²	4.84%	11.07%	13.81%	6.79%	3.58%
Ratios/Supplemental Data
Ratios to average net assets:
Net operating expenses (including dividend expense on short sales)	1.81% ³	1.82%	1.99%	2.48%	2.08%	1.86%
Net operating expenses (excluding dividend expense on short sales)	1.54% ³^,⁴	1.54% ⁴	1.52% ⁴	1.48% ⁴	1.53% ⁴	1.44% ⁵
Gross operating expenses	1.84% ³	1.84%	2.02%	2.52%	2.13%	1.88%
Net investment income (loss)	0.74% ³	(0.06%)	(0.46%)	(0.49%)	(0.47%)	(0.25%)
Portfolio turnover rate	69% ²	146%	142%	130%	109%	98%
Net assets, end of period (x 1,000,000)	$196	$212	$200	$193	$194	$236

*	Unaudited.

Calculated based on the average shares outstanding during the period.

Not annualized.

Annualized (except for proxy costs).

⁴

The ratio of net operating expenses would have been 1.33% for the period ended 10/31/12, 10/31/13, 10/31/14, 10/31/15 and 4/30/16, respectively, if stock loan fees on short sales had not been incurred.

⁵

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.

48 See financial notes

Schwab Hedged Equity Fund

Portfolio Holdings as of April 30, 2016 (Unaudited)

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

Holdings by Category		Cost ($)	Value ($)
98.9%	Common Stock	190,065,449	193,832,177
1.2%	Other Investment Company	2,428,308	2,428,308
100.1%	Total Investments	192,493,757	196,260,485
(40.4%)	Short Sales	(84,461,012)	(79,168,200)
40.3%	Other Assets and Liabilities, Net		78,975,989
100.0%	Net Assets		196,068,274

Security	Number of Shares	Value ($)
Common Stock 98.9% of net assets
Automobiles & Components 2.4%
American Axle & Manufacturing Holdings, Inc. *	76,311	1,183,584
Dana Holding Corp. (a)	167,437	2,164,960
Ford Motor Co.	46,604	631,950
Lear Corp.	6,727	774,480
		4,754,974
Banks 9.0%
Bank of America Corp. (a)	323,460	4,709,578
Citigroup, Inc. (a)	94,361	4,367,027
Fifth Third Bancorp	45,758	837,829
MGIC Investment Corp. *	158,548	1,146,302
Radian Group, Inc. (a)	202,790	2,593,684
Regions Financial Corp. (a)	239,500	2,246,510
The PNC Financial Services Group, Inc. (a)	18,477	1,621,911
		17,522,841
Capital Goods 5.4%
Allison Transmission Holdings, Inc.	67,679	1,949,832
Babcock & Wilcox Enterprises, Inc. *	24,000	548,400
Briggs & Stratton Corp.	25,748	545,085
Huntington Ingalls Industries, Inc. (a)	19,529	2,827,213
Ply Gem Holdings, Inc. *	64,533	945,409
Spirit AeroSystems Holdings, Inc., Class A *(a)	77,421	3,650,400
The Toro Co.	1,563	135,121
		10,601,460

Security	Number of Shares	Value ($)
Commercial & Professional Supplies 2.1%
R.R. Donnelley & Sons Co. (a)	211,444	3,679,126
The Brink's Co.	14,374	486,416
		4,165,542
Consumer Durables & Apparel 2.2%
Smith & Wesson Holding Corp. *	105,140	2,295,206
Wolverine World Wide, Inc. (a)	107,649	2,039,949
		4,335,155
Consumer Services 3.4%
Bloomin' Brands, Inc.	61,706	1,153,902
Darden Restaurants, Inc. (a)	57,972	3,608,757
Houghton Mifflin Harcourt Co. *	27,385	561,666
ServiceMaster Global Holdings, Inc. *	11,131	426,540
Six Flags Entertainment Corp.	14,459	868,263
		6,619,128
Diversified Financials 2.6%
Ally Financial, Inc. *	56,944	1,014,172
Interactive Brokers Group, Inc., Class A (a)	39,333	1,494,654
Voya Financial, Inc. (a)	79,310	2,575,196
		5,084,022
Energy 5.8%
Alon USA Energy, Inc.	14,213	149,236
Apache Corp.	58,893	3,203,779
CVR Energy, Inc. (a)	77,231	1,875,169
Devon Energy Corp.	19,967	692,456
Marathon Petroleum Corp.	12,616	493,033
Schlumberger Ltd.	7,334	589,214
Tesoro Corp.	18,669	1,487,733
Valero Energy Corp. (a)	39,378	2,318,183
Western Refining, Inc.	8,665	231,875
World Fuel Services Corp.	8,171	381,831
		11,422,509
Food & Staples Retailing 2.3%
SpartanNash, Co.	27,956	774,381
SUPERVALU, Inc. *	144,621	727,444
The Kroger Co. (a)	86,874	3,074,471
		4,576,296
Food, Beverage & Tobacco 2.3%
Dean Foods Co. (a)	195,372	3,366,260
Dr Pepper Snapple Group, Inc. (a)	12,752	1,159,284
		4,525,544
Health Care Equipment & Services 7.3%
AmerisourceBergen Corp. (a)	12,693	1,080,174
C.R. Bard, Inc. (a)	19,501	4,137,527
Cardinal Health, Inc. (a)	38,775	3,042,286
Hologic, Inc. *	27,581	926,446
McKesson Corp. (a)	5,617	942,645
Molina Healthcare, Inc. *(a)	26,216	1,356,940

See financial notes 49

Schwab Hedged Equity Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Owens & Minor, Inc.	52,546	1,912,149
ResMed, Inc.	16,792	936,994
		14,335,161
Insurance 1.5%
Aspen Insurance Holdings Ltd.	22,884	1,060,673
Genworth Financial, Inc., Class A *(a)	82,885	284,296
Loews Corp.	38,481	1,526,926
		2,871,895
Materials 7.7%
Cabot Corp.	20,228	986,924
Chemtura Corp. *	1,152	32,083
H.B. Fuller Co.	29,603	1,323,846
Innospec, Inc.	23,760	1,149,034
International Paper Co. (a)	79,436	3,437,196
Kaiser Aluminum Corp.	7,042	667,793
Nucor Corp.	43,861	2,183,400
Steel Dynamics, Inc.	50,087	1,262,693
Stepan Co.	23,702	1,452,696
Trinseo S.A. *	45,245	1,936,033
Worthington Industries, Inc.	16,269	614,155
		15,045,853
Media 0.5%
Comcast Corp., Class A	16,672	1,012,991
Pharmaceuticals, Biotechnology & Life Sciences 9.6%
AbbVie, Inc.	29,612	1,806,332
Amgen, Inc. (a)	28,707	4,544,318
Celgene Corp. *(a)	9,869	1,020,553
Gilead Sciences, Inc. (a)	46,013	4,058,807
Incyte Corp. *	3,277	236,829
Johnson & Johnson (a)	28,728	3,219,834
Merck & Co., Inc. (a)	71,733	3,933,838
		18,820,511
Real Estate 4.2%
CoreSite Realty Corp.	5,418	405,971
Empire State Realty Trust, Inc., Class A	66,946	1,239,171
Essex Property Trust, Inc.	61	13,447
First Industrial Realty Trust, Inc. (a)	127,068	2,914,940
Lamar Advertising Co., Class A (a)	50,799	3,151,570
Simon Property Group, Inc. (a)	2,696	542,354
		8,267,453
Retailing 9.6%
Amazon.com, Inc. *	8,338	5,499,661
Best Buy Co., Inc.	11,242	360,643
Chico's FAS, Inc.	13,834	174,447
Express, Inc. *	54,455	989,992
GameStop Corp., Class A	16,043	526,210
Liberty TripAdvisor Holdings, Inc., Class A *	71,864	1,585,320
Lowe's Cos., Inc. (a)	50,524	3,840,835
Outerwall, Inc. (a)	61,171	2,526,974
Rent-A-Center, Inc.	121,412	1,784,756

Security	Number of Shares	Value ($)
Staples, Inc.	49,186	501,697
Target Corp.	13,397	1,065,062
		18,855,597
Semiconductors & Semiconductor Equipment 0.9%
Synaptics, Inc. *	3,919	280,404
Teradyne, Inc.	70,528	1,333,685
Tessera Technologies, Inc.	4,169	119,734
		1,733,823
Software & Services 4.6%
Citrix Systems, Inc. *	1,083	88,633
GoDaddy, Inc., Class A *	27,789	843,952
Leidos Holdings, Inc. (a)	33,221	1,648,094
LogMeIn, Inc. *	6,296	375,871
NeuStar, Inc., Class A *	5,355	125,789
Nuance Communications, Inc. *	106,807	1,834,944
Progress Software Corp. *	55,561	1,417,917
Rackspace Hosting, Inc. *	17,405	398,052
Take-Two Interactive Software, Inc. *	39,869	1,362,722
Web.com Group, Inc. *	44,592	891,394
		8,987,368
Technology Hardware & Equipment 10.0%
Apple, Inc. (a)	66,996	6,280,205
Benchmark Electronics, Inc. *	41,614	808,144
Ciena Corp. *	33,694	567,070
Cisco Systems, Inc. (a)	75,720	2,081,543
Insight Enterprises, Inc. *	44,294	1,094,505
Ixia *	32,636	330,276
Jabil Circuit, Inc.	80,589	1,399,025
Juniper Networks, Inc.	79,447	1,859,060
NCR Corp. *	99,612	2,897,713
NETGEAR, Inc. *	7,126	302,142
SYNNEX Corp.	18,129	1,496,911
Tech Data Corp. *	6,856	470,939
		19,587,533
Telecommunication Services 0.7%
Telephone & Data Systems, Inc.	48,345	1,429,562
Transportation 2.3%
ArcBest Corp.	9,592	183,111
Delta Air Lines, Inc. (a)	71,018	2,959,320
Hawaiian Holdings, Inc. *	31,715	1,334,250
		4,476,681
Utilities 2.5%
Entergy Corp. (a)	48,656	3,657,958
Exelon Corp.	2,632	92,357
FirstEnergy Corp.	15,441	503,222
UGI Corp.	13,587	546,741
		4,800,278
Total Common Stock
(Cost $190,065,449)		193,832,177

50 See financial notes

Schwab Hedged Equity Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Short Sales 40.4% of net assets
Automobiles & Components 2.0%
Dorman Products, Inc. *	24,359	1,310,271
Harley-Davidson, Inc.	16,885	807,609
Tesla Motors, Inc. *	7,278	1,752,251
		3,870,131
Banks 1.2%
Ameris Bancorp	32,319	1,014,817
BofI Holding, Inc. *	14,300	291,291
Eagle Bancorp, Inc. *	13,095	663,916
Texas Capital Bancshares, Inc. *	7,486	343,009
		2,313,033
Capital Goods 3.0%
Air Lease Corp.	52,846	1,610,746
Dycom Industries, Inc. *	8,496	599,818
Hexcel Corp.	53,065	2,402,253
Proto Labs, Inc. *	22,580	1,350,961
		5,963,778
Commercial & Professional Supplies 0.8%
Copart, Inc. *	372	15,937
MSA Safety, Inc.	18,768	902,553
Verisk Analytics, Inc. *	7,883	611,563
		1,530,053
Consumer Durables & Apparel 0.6%
Under Armour, Inc., Class A *	27,021	1,187,303
Consumer Services 2.4%
Chipotle Mexican Grill, Inc. *	2,815	1,185,031
Dunkin' Brands Group, Inc.	54,010	2,511,465
Wynn Resorts Ltd.	10,911	963,441
		4,659,937
Diversified Financials 0.5%
Financial Engines, Inc.	27,349	880,911
Virtus Investment Partners, Inc.	1,300	101,686
		982,597
Energy 2.6%
Cheniere Energy, Inc. *	57,831	2,248,469
Cobalt International Energy, Inc. *	246,862	797,364
Golar LNG Ltd.	49,637	822,982
RSP Permian, Inc. *	41,721	1,277,080
		5,145,895
Food, Beverage & Tobacco 1.3%
Monster Beverage Corp. *	17,558	2,532,215
Health Care Equipment & Services 2.8%
Acadia Healthcare Co., Inc. *	27,641	1,746,635
MEDNAX, Inc. *	3,515	250,584

Security	Number of Shares	Value ($)
Nevro Corp. *	26,925	1,810,706
Team Health Holdings, Inc. *	28,643	1,198,137
Wright Medical Group N.V. *	26,360	495,041
		5,501,103
Insurance 1.4%
RLI Corp.	33,991	2,113,560
White Mountains Insurance Group Ltd.	807	669,810
		2,783,370
Materials 6.0%
Albemarle Corp.	19,573	1,294,950
Allegheny Technologies, Inc.	15,962	260,819
CF Industries Holdings, Inc.	1,271	42,032
Compass Minerals International, Inc.	24,364	1,826,325
FMC Corp.	32,310	1,397,731
Louisiana-Pacific Corp. *	152,724	2,596,308
Martin Marietta Materials, Inc.	14,924	2,525,588
Southern Copper Corp.	64,673	1,918,848
		11,862,601
Media 0.1%
Loral Space & Communications, Inc. *	5,400	198,072
Pharmaceuticals, Biotechnology & Life Sciences 4.4%
ACADIA Pharmaceuticals, Inc. *	52,234	1,687,158
Agios Pharmaceuticals, Inc. *	2,427	118,802
Bio-Techne Corp.	682	63,549
Illumina, Inc. *	2,896	390,931
Intercept Pharmaceuticals, Inc. *	8,889	1,339,928
Seattle Genetics, Inc. *	61,521	2,182,765
The Medicines Co. *	27,392	974,881
TherapeuticsMD, Inc. *	40,758	336,254
Ultragenyx Pharmaceutical, Inc. *	22,841	1,544,508
		8,638,776
Real Estate 1.9%
Acadia Realty Trust	28,230	951,351
Education Realty Trust, Inc.	34,904	1,388,132
Extra Space Storage, Inc.	4,422	375,649
Gramercy Property Trust	116,275	984,849
		3,699,981
Retailing 2.3%
Cabela's, Inc. *	6,279	327,450
CarMax, Inc. *	17,145	907,828
Dollar Tree, Inc. *	19,955	1,590,613
Netflix, Inc. *	10,008	901,020
Restoration Hardware Holdings, Inc. *	16,263	703,700
		4,430,611

52 See financial notes

Schwab Hedged Equity Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Semiconductors & Semiconductor Equipment 1.2%
M/A-COM Technology Solutions Holdings, Inc. *	42,526	1,738,888
Qorvo, Inc. *	9,760	439,493
SunPower Corp. *	11,350	228,589
		2,406,970
Software & Services 2.1%
Benefitfocus, Inc. *	8,494	321,923
Demandware, Inc. *	9,489	437,253
Envestnet, Inc. *	4,966	155,833
Globant S.A. *	31,040	1,101,610
Guidewire Software, Inc. *	10,069	573,631
Splunk, Inc. *	20,105	1,045,058
Tableau Software, Inc., Class A *	8,446	436,658
Zendesk, Inc. *	2,966	67,031
		4,138,997
Technology Hardware & Equipment 1.4%
Arista Networks, Inc. *	10,796	719,229
National Instruments Corp.	6,130	169,004

Security	Number of Shares	Value ($)
Stratasys Ltd. *	10,431	255,247
Super Micro Computer, Inc. *	42,642	1,147,496
ViaSat, Inc. *	5,710	437,957
		2,728,933
Transportation 1.2%
Kansas City Southern	1,360	128,860
Spirit Airlines, Inc. *	50,095	2,200,673
		2,329,533
Utilities 1.2%
WEC Energy Group, Inc.	38,899	2,264,311
Total Short Sales
(Proceeds $84,461,012)		79,168,200

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, 2016 (see financial note 2(a) for additional information):

Assets Valuation Input

Description	Quoted Prices in Active Markets for Identical Assets (Level 1)	Other Significant Observable Inputs (Level 2)	Significant Unobservable Inputs (Level 3)	Total
Common Stock¹	$193,832,177	$—	$—	$193,832,177
Other Investment Company¹	2,428,308	—	—	2,428,308
Total	$196,260,485	$—	$—	$196,260,485
Liabilities Valuation Input

Other Financial Instruments
Short Sales¹	($79,168,200)	$—	$—	($79,168,200)

¹	As categorized in Portfolio Holdings.

See financial notes 53

Schwab Financial Services Fund

Financial Statements

Financial Highlights

	11/1/15– 4/30/16*	11/1/14– 10/31/15	11/1/13– 10/31/14	11/1/12– 10/31/13	11/1/11– 10/31/12	11/1/10– 10/31/11
Per-Share Data
Net asset value at beginning of period	$16.12	$15.82	$13.76	$10.66	$9.17	$9.74
Income (loss) from investment operations:
Net investment income (loss)	0.12 ¹	0.20 ¹	0.11	0.11	0.08	0.05
Net realized and unrealized gains (losses)	(0.76)	0.23	2.07	3.08	1.46	(0.58)
Total from investment operations	(0.64)	0.43	2.18	3.19	1.54	(0.53)
Less distributions:
Distributions from net investment income	(0.17)	(0.13)	(0.12)	(0.09)	(0.05)	(0.04)
Net asset value at end of period	$15.31	$16.12	$15.82	$13.76	$10.66	$9.17
Total return	(3.98%) ²	2.70%	15.92%	30.20%	16.92%	(5.51%)
Ratios/Supplemental Data
Ratios to average net assets:
Net operating expenses	0.88% ³	0.90%	0.90%	0.94%	0.94%	0.93% ⁴
Gross operating expenses	0.93% ³	0.94%	0.95%	1.03%	1.10%	1.06%
Net investment income (loss)	1.56% ³	1.23%	0.76%	0.91%	0.78%	0.45%
Portfolio turnover rate	27% ²	53%	75%	74%	84%	77%
Net assets, end of period (x 1,000,000)	$69	$75	$78	$66	$47	$40

*	Unaudited.

Calculated based on the average shares outstanding during the period.

Not annualized.

Annualized (except for proxy costs).

⁴

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

See financial notes 57

Schwab Financial Services Fund

Portfolio Holdings as of April 30, 2016 (Unaudited)

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

Holdings by Category		Cost ($)	Value ($)
98.6%	Common Stock	60,588,163	68,277,517
1.0%	Short-Term Investment	691,605	691,605
99.6%	Total Investments	61,279,768	68,969,122
0.4%	Other Assets and Liabilities, Net		252,249
100.0%	Net Assets		69,221,371

Security	Number of Shares	Value ($)
Common Stock 98.6% of net assets
Banks 36.8%
1st Source Corp.	3,683	126,842
Banc of California, Inc.	35,016	712,576
Bank of America Corp.	245,913	3,580,493
Central Pacific Financial Corp.	20,152	470,348
Citigroup, Inc.	72,008	3,332,530
Citizens Financial Group, Inc.	26,312	601,229
Federal Agricultural Mortgage Corp., Class C	6,910	281,099
Fifth Third Bancorp	64,236	1,176,161
First Bancorp (North Carolina)	6,208	126,643
First Defiance Financial Corp.	3,308	130,931
First Midwest Bancorp, Inc.	5,445	100,624
Fulton Financial Corp.	5,159	72,174
Huntington Bancshares, Inc.	69,000	694,140
JPMorgan Chase & Co.	66,860	4,225,552
MGIC Investment Corp. *	62,657	453,010
Provident Financial Services, Inc.	9,927	198,341
Radian Group, Inc.	24,971	319,379
Regions Financial Corp.	82,500	773,850
SunTrust Banks, Inc.	23,954	999,840
TCF Financial Corp.	27,667	377,378
The PNC Financial Services Group, Inc.	18,379	1,613,309
TrustCo Bank Corp.	40,835	261,752
U.S. Bancorp	15,581	665,153
Wells Fargo & Co.	80,399	4,018,342
WSFS Financial Corp.	4,397	150,114
		25,461,810
Diversified Financials 23.7%
Ally Financial, Inc. *	32,733	582,975
Ameriprise Financial, Inc.	12,082	1,158,664
Berkshire Hathaway, Inc., Class B *	31,356	4,561,671

Security	Number of Shares	Value ($)
Calamos Asset Management, Inc., Class A	29,242	240,954
Capital One Financial Corp.	15,188	1,099,459
Cash America International, Inc.	2,233	82,532
Discover Financial Services	23,057	1,297,417
ETRADE Financial Corp.	3,190	80,324
Evercore Partners, Inc., Class A	20,017	1,033,678
Federated Investors, Inc., Class B	30,171	953,403
Interactive Brokers Group, Inc., Class A	11,275	428,450
Janus Capital Group, Inc.	8,730	127,458
Lazard Ltd., Class A	2,033	73,290
Morgan Stanley	28,319	766,312
MSCI, Inc.	1,803	136,920
Nasdaq, Inc.	8,510	525,152
Synchrony Financial *	17,516	535,464
The Bank of New York Mellon Corp.	21,617	869,868
The Goldman Sachs Group, Inc.	7,937	1,302,541
Voya Financial, Inc.	17,729	575,661
		16,432,193
Insurance 14.4%
Aflac, Inc.	6,735	464,513
American Equity Investment Life Holding Co.	7,870	110,180
American Financial Group, Inc.	18,221	1,259,253
American International Group, Inc.	23,010	1,284,418
AMERISAFE, Inc.	2,905	156,521
Aon plc	950	99,864
Aspen Insurance Holdings Ltd.	2,162	100,209
Everest Re Group Ltd.	968	178,983
First American Financial Corp.	2,119	76,326
Heritage Insurance Holdings, Inc.	19,357	257,255
Lincoln National Corp.	8,228	357,507
Loews Corp.	5,373	213,201
Maiden Holdings Ltd.	45,750	559,523
MetLife, Inc.	36,745	1,657,199
Selective Insurance Group, Inc.	27,057	939,148
The Allstate Corp.	6,232	405,392
The Hanover Insurance Group, Inc.	2,627	225,292
The Hartford Financial Services Group, Inc.	7,496	332,672
The Travelers Cos., Inc.	7,290	801,171
United Fire Group, Inc.	9,873	442,508
XL Group plc	1,794	58,718
		9,979,853
Real Estate 23.7%
American Tower Corp.	1,474	154,593
AvalonBay Communities, Inc.	2,125	375,679
Brixmor Property Group, Inc.	35,458	895,315
Camden Property Trust	1,035	83,556
CoreSite Realty Corp.	14,285	1,070,375
Empire State Realty Trust, Inc., Class A	56,893	1,053,089
Equity LifeStyle Properties, Inc.	16,543	1,133,030
Equity Residential	6,926	471,453
Essex Property Trust, Inc.	943	207,884
First Industrial Realty Trust, Inc.	52,061	1,194,279
Healthcare Realty Trust, Inc.	37,343	1,130,746
Healthcare Trust of America, Inc., Class A	4,808	138,903

58 See financial notes

Schwab Financial Services Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Lamar Advertising Co., Class A	19,102	1,185,088
Lexington Realty Trust	31,634	277,747
Mack-Cali Realty Corp.	22,813	583,100
Mid-America Apartment Communities, Inc.	4,990	477,593
Post Properties, Inc.	3,636	208,561
Prologis, Inc.	12,816	581,975
PS Business Parks, Inc.	3,419	327,403
Public Storage	1,581	387,045
RE/MAX Holdings, Inc., Class A	8,029	295,467
Saul Centers, Inc.	1,160	61,689
Select Income REIT	6,993	161,888
Simon Property Group, Inc.	12,480	2,510,602
SL Green Realty Corp.	6,916	726,733
Summit Hotel Properties, Inc.	55,666	634,592
VEREIT, Inc.	8,477	75,276
		16,403,661
Total Common Stock
(Cost $60,588,163)		68,277,517
Security Rate, Maturity Date	Face Amount ($)	Value ($)
Short-Term Investment 1.0% of net assets
Time Deposit 1.0%
Sumitomo Mitsui Banking Corp.
0.15%, 05/02/16 (a)	691,605	691,605
Total Short-Term Investment
(Cost $691,605)		691,605

End of Investments.

At 04/30/16, the tax basis cost of the fund's investments was $61,283,393 and the unrealized appreciation and depreciation were $9,910,609 and ($2,224,880), respectively, with a net unrealized appreciation of $7,685,729.

*	Non-income producing security.
(a)	The rate shown is the current daily overnight rate.

REIT —

Real Estate Investment Trust

In addition to the above, the fund held the following at 04/30/16:

	Number of Contracts	Contract Value ($)	Unrealized Appreciation ($)
Futures Contracts
S&P 500 Index, e-mini, Long, expires 06/17/16	8	823,640	31,868

The following is a summary of the inputs used to value the fund's investments as of April 30, 2016 (see financial note 2(a) for additional information):

Description	Quoted Prices in Active Markets for Identical Assets (Level 1)	Other Significant Observable Inputs (Level 2)	Significant Unobservable Inputs (Level 3)	Total
Common Stock¹	$68,277,517	$—	$—	$68,277,517
Short-Term Investment¹	—	691,605	—	691,605
Total	$68,277,517	$691,605	$—	$68,969,122
Other Financial Instruments
Futures Contracts²	$31,868	$—	$—	$31,868

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.

See financial notes 59

Schwab Health Care Fund

Financial Statements

Financial Highlights

	11/1/15– 4/30/16*	11/1/14– 10/31/15	11/1/13– 10/31/14	11/1/12– 10/31/13	11/1/11– 10/31/12	11/1/10– 10/31/11
Per-Share Data
Net asset value at beginning of period	$26.68	$28.19	$24.57	$20.59	$17.29	$15.48
Income (loss) from investment operations:
Net investment income (loss)	0.10 ¹	0.14 ¹	0.23	0.22	0.27	0.15
Net realized and unrealized gains (losses)	(0.66)	1.78	5.84	6.26	3.18	1.85
Total from investment operations	(0.56)	1.92	6.07	6.48	3.45	2.00
Less distributions:
Distributions from net investment income	(0.16)	(0.21)	(0.19)	(0.33)	(0.15)	(0.19)
Distributions from net realized gains	(3.63)	(3.22)	(2.26)	(2.17)	—	—
Total distributions	(3.79)	(3.43)	(2.45)	(2.50)	(0.15)	(0.19)
Net asset value at end of period	$22.33	$26.68	$28.19	$24.57	$20.59	$17.29
Total return	(2.42%) ²	7.26%	27.06%	35.46%	20.10%	13.00%
Ratios/Supplemental Data
Ratios to average net assets:
Net operating expenses	0.80% ³	0.79%	0.80%	0.82%	0.82%	0.81% ⁴
Gross operating expenses	0.80% ³	0.80%	0.81%	0.83%	0.85%	0.85%
Net investment income (loss)	0.86% ³	0.52%	0.93%	1.06%	1.44%	0.85%
Portfolio turnover rate	27% ²	75%	57%	54%	60%	24%
Net assets, end of period (x 1,000,000)	$979	$1,118	$1,064	$816	$511	$414

*	Unaudited.

Calculated based on the average shares outstanding during the period.

Not annualized.

Annualized (except for proxy costs).

⁴

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.

See financial notes 63

Schwab Health Care Fund

Portfolio Holdings as of April 30, 2016 (Unaudited)

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

Holdings by Category		Cost ($)	Value ($)
99.6%	Common Stock	814,768,969	975,435,951
0.1%	Other Investment Company	1,154,749	1,154,749
0.0%	Short-Term Investments	323,636	323,636
99.7%	Total Investments	816,247,354	976,914,336
0.3%	Other Assets and Liabilities, Net		2,513,834
100.0%	Net Assets		979,428,170

Security	Number of Shares	Value ($)
Common Stock 99.6% of net assets
Australia 1.9%
Health Care Equipment & Services 1.9%
Cochlear Ltd.	223,805	18,306,413
Finland 1.4%
Pharmaceuticals, Biotechnology & Life Sciences 1.4%
Orion Oyj, Class B	384,826	13,439,943
France 1.4%
Pharmaceuticals, Biotechnology & Life Sciences 1.4%
Ipsen S.A.	36,879	2,229,664
Sanofi	145,277	11,974,685
		14,204,349
Germany 0.1%
Pharmaceuticals, Biotechnology & Life Sciences 0.1%
Gerresheimer AG	10,000	745,815
Hong Kong 0.9%
Pharmaceuticals, Biotechnology & Life Sciences 0.9%
Sino Biopharmaceutical Ltd.	12,242,300	8,674,947
Ireland 4.7%
Health Care Equipment & Services 1.9%
Medtronic plc	232,565	18,407,520

Security	Number of Shares	Value ($)
Pharmaceuticals, Biotechnology & Life Sciences 2.8%
Allergan plc *	76,461	16,558,394
Jazz Pharmaceuticals plc *	63,200	9,524,240
Mallinckrodt plc *	24,900	1,556,748
		27,639,382
		46,046,902
Israel 1.0%
Pharmaceuticals, Biotechnology & Life Sciences 1.0%
Teva Pharmaceutical Industries Ltd.	184,085	10,112,344
Italy 0.9%
Health Care Equipment & Services 0.1%
DiaSorin S.p.A.	13,636	797,111
Pharmaceuticals, Biotechnology & Life Sciences 0.8%
Recordati S.p.A.	319,435	8,128,325
		8,925,436
Japan 2.8%
Health Care Equipment & Services 1.4%
Hoya Corp.	308,800	11,825,266
Toho Holdings Co., Ltd.	68,400	1,582,435
		13,407,701
Pharmaceuticals, Biotechnology & Life Sciences 1.4%
Astellas Pharma, Inc.	237,700	3,204,810
Nichi-iko Pharmaceutical Co., Ltd.	372,300	8,852,337
Shionogi & Co., Ltd.	34,500	1,760,954
		13,818,101
		27,225,802
Malaysia 0.2%
Health Care Equipment & Services 0.2%
Top Glove Corp. Berhad	1,426,600	1,810,085
New Zealand 0.3%
Health Care Equipment & Services 0.3%
Fisher & Paykel Healthcare Corp., Ltd.	496,877	3,171,134
Switzerland 7.7%
Pharmaceuticals, Biotechnology & Life Sciences 7.7%
Actelion Ltd. - Reg'd *	138,452	22,440,315
Lonza Group AG - Reg'd *	121,436	20,254,096
Novartis AG - Reg'd	46,000	3,500,702
Roche Holding AG	116,288	29,421,931
		75,617,044
Taiwan 0.6%
Health Care Equipment & Services 0.4%
St. Shine Optical Co., Ltd.	180,000	3,361,033

64 See financial notes

Schwab Health Care Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Pharmaceuticals, Biotechnology & Life Sciences 0.2%
ScinoPharm Taiwan Ltd.	199,000	260,942
TTY Biopharm Co., Ltd.	578,000	1,882,900
		2,143,842
		5,504,875
United Kingdom 2.6%
Pharmaceuticals, Biotechnology & Life Sciences 2.6%
GlaxoSmithKline plc	500,900	10,705,469
Shire plc	234,568	14,637,519
		25,342,988
United States 73.1%
Health Care Equipment & Services 22.0%
Abbott Laboratories	419,061	16,301,473
Allscripts Healthcare Solutions, Inc. *	537,800	7,206,520
Amedisys, Inc. *	28,485	1,466,693
AmerisourceBergen Corp.	184,566	15,706,567
Becton, Dickinson & Co.	17,000	2,741,420
C.R. Bard, Inc.	115,900	24,590,503
Cardinal Health, Inc.	65,800	5,162,668
DENTSPLY SIRONA, Inc.	89,878	5,356,729
Express Scripts Holding Co. *	313,860	23,140,898
Haemonetics Corp. *	66,428	2,154,260
HCA Holdings, Inc. *	71,700	5,780,454
Hill-Rom Holdings, Inc.	71,700	3,466,695
Hologic, Inc. *	637,767	21,422,593
Humana, Inc.	28,199	4,993,197
IMS Health Holdings, Inc. *	88,300	2,352,312
LifePoint Health, Inc. *	108,800	7,350,528
Magellan Health, Inc. *	26,400	1,860,144
Meridian Bioscience, Inc.	248,500	4,748,835
Merit Medical Systems, Inc. *	48,230	976,657
Molina Healthcare, Inc. *	240,429	12,444,605
NxStage Medical, Inc. *	31,955	515,115
Owens & Minor, Inc.	70,900	2,580,051
RadNet, Inc. *	102,700	518,635
ResMed, Inc.	34,000	1,897,200
St. Jude Medical, Inc.	120,500	9,182,100
Stryker Corp.	34,740	3,787,007
Teleflex, Inc.	12,343	1,922,793
UnitedHealth Group, Inc.	153,191	20,172,191
WellCare Health Plans, Inc. *	65,576	5,901,184
		215,700,027
Pharmaceuticals, Biotechnology & Life Sciences 51.1%
AbbVie, Inc.	424,026	25,865,586
Acorda Therapeutics, Inc. *	207,842	5,372,716
Agilent Technologies, Inc.	510,100	20,873,292
AMAG Pharmaceuticals, Inc. *	170,200	4,513,704
Amgen, Inc.	300,211	47,523,401
Biogen, Inc. *	43,664	12,007,163
Bristol-Myers Squibb Co.	46,134	3,329,952
Catalent, Inc. *	166,800	4,925,604
Celgene Corp. *	266,906	27,600,749
Charles River Laboratories International, Inc. *	270,492	21,441,901
Depomed, Inc. *	330,681	5,747,236
Eli Lilly & Co.	219,262	16,560,859

Security	Number of Shares	Value ($)
Emergent BioSolutions, Inc. *	290,000	11,170,800
Five Prime Therapeutics, Inc. *	67,200	3,198,048
Genomic Health, Inc. *	18,033	473,907
Gilead Sciences, Inc.	609,452	53,759,761
INC Research Holdings, Inc., Class A *	58,300	2,805,979
Incyte Corp. *	64,106	4,632,941
Johnson & Johnson	652,650	73,149,012
Lexicon Pharmaceuticals, Inc. *(a)	85,300	1,177,993
Luminex Corp. *	102,100	2,052,210
Merck & Co., Inc.	906,060	49,688,330
PDL BioPharma, Inc.	222,700	839,579
PerkinElmer, Inc.	43,395	2,187,976
Pfizer, Inc.	1,703,500	55,721,485
Phibro Animal Health Corp., Class A	53,367	1,106,832
Prestige Brands Holdings, Inc. *	305,301	17,334,991
SciClone Pharmaceuticals, Inc. *	51,363	677,992
Spectrum Pharmaceuticals, Inc. *	90,700	643,063
Thermo Fisher Scientific, Inc.	73,450	10,595,162
Zoetis, Inc.	289,807	13,629,623
		500,607,847
		716,307,874
Total Common Stock
(Cost $814,768,969)		975,435,951

Other Investment Company 0.1% of net assets
United States 0.1%
Securities Lending Collateral 0.1%
Wells Fargo Advantage Government Money Market Fund, Select Class 0.23% (b)	1,154,749	1,154,749
Total Other Investment Company
(Cost $1,154,749)		1,154,749
Security Rate, Maturity Date	Face Amount Local Currency	Value ($)
Short-Term Investments 0.0% of net assets
Time Deposits 0.0%
Brown Brothers Harriman
Euro
(0.53%), 05/02/16 (c)	6,258	7,166
Wells Fargo
Swiss Franc
(1.63%), 05/02/16 (c)	303,590	316,470
Total Short-Term Investments
(Cost $323,636)		323,636

End of Investments.

See financial notes 65

Schwab Health Care Fund

Portfolio Holdings (Unaudited) continued

At 04/30/16, the tax basis cost of the fund's investments was $817,017,011 and the unrealized appreciation and depreciation were $193,256,320 and ($33,358,995), respectively, with a net unrealized appreciation of $159,897,325.

At 04/30/16, the values of certain foreign securities held by the fund aggregating $213,081,175 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 $1,119,093.
(b)	The rate shown is the 7-day yield.
(c)	The rate shown is the current daily overnight rate.

Reg'd —

Registered

The following is a summary of the inputs used to value the fund's investments as of April 30, 2016 (see financial note 2(a) for additional information):

Description	Quoted Prices in Active Markets for Identical Assets (Level 1)	Other Significant Observable Inputs (Level 2)	Significant Unobservable Inputs (Level 3)	Total
Common Stock¹	$762,354,776	$—	$—	$762,354,776
Australia ¹	—	18,306,413	—	18,306,413
Finland ¹	—	13,439,943	—	13,439,943
France ¹	—	14,204,349	—	14,204,349
Germany ¹	—	745,815	—	745,815
Hong Kong¹	—	8,674,947	—	8,674,947
Israel ¹	—	10,112,344	—	10,112,344
Italy ¹	—	8,925,436	—	8,925,436
Japan ¹	—	27,225,802	—	27,225,802
Malaysia ¹	—	1,810,085	—	1,810,085
New Zealand¹	—	3,171,134	—	3,171,134
Switzerland ¹	—	75,617,044	—	75,617,044
Taiwan ¹	—	5,504,875	—	5,504,875
United Kingdom¹	—	25,342,988	—	25,342,988
Other Investment Company¹	1,154,749	—	—	1,154,749
Short-Term Investments¹	—	323,636	—	323,636
Total	$763,509,525	$213,404,811	$—	$976,914,336

¹	As categorized in Portfolio Holdings.

66 See financial notes

Schwab International Core Equity Fund

Financial Statements

Financial Highlights

	11/1/15– 4/30/16*	11/1/14– 10/31/15	11/1/13– 10/31/14	11/1/12– 10/31/13	11/1/11– 10/31/12	11/1/10– 10/31/11
Per-Share Data
Net asset value at beginning of period	$9.62	$9.77	$9.82	$7.90	$7.32	$7.80
Income (loss) from investment operations:
Net investment income (loss)	0.11 ¹	0.19 ¹	0.29 ¹	0.20	0.16	0.17
Net realized and unrealized gains (losses)	(0.51)	(0.01)	(0.08)	1.93	0.62	(0.46)
Total from investment operations	(0.40)	0.18	0.21	2.13	0.78	(0.29)
Less distributions:
Distributions from net investment income	(0.19)	(0.15)	(0.26)	(0.21)	(0.20)	(0.19)
Distributions from net realized gains	—	(0.18)	—	—	—	—
Total distributions	(0.19)	(0.33)	(0.26)	(0.21)	(0.20)	(0.19)
Net asset value at end of period	$9.03	$9.62	$9.77	$9.82	$7.90	$7.32
Total return	(4.21%) ²	2.05%	2.20%	27.70%	11.17%	(3.89%)
Ratios/Supplemental Data
Ratios to average net assets:
Net operating expenses	0.86% ³	0.86%	0.86%	0.86%	0.86%	0.80% ⁴
Gross operating expenses	0.91% ³	0.92%	0.98%	1.10%	1.16%	1.22%
Net investment income (loss)	2.60% ³	2.02%	2.95%	2.40%	2.45%	2.32%
Portfolio turnover rate	44% ²	87%	90%	75%	112%	86%
Net assets, end of period (x 1,000,000)	$741	$679	$423	$147	$78	$60

*	Unaudited.

Calculated based on the average shares outstanding during the period.

Not annualized.

Annualized (except for proxy costs).

⁴

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

70 See financial notes

Schwab International Core Equity Fund

Portfolio Holdings as of April 30, 2016 (Unaudited)

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

Holdings by Category		Cost ($)	Value ($)
98.0%	Common Stock	734,731,714	726,717,389
1.3%	Other Investment Company	9,481,657	9,481,657
99.3%	Total Investments	744,213,371	736,199,046
0.7%	Other Assets and Liabilities, Net		5,295,942
100.0%	Net Assets		741,494,988

Security	Number of Shares	Value ($)
Common Stock 98.0% of net assets
Australia 6.1%
Banks 1.8%
Australia & New Zealand Banking Group Ltd.	717,983	13,160,573
Commercial & Professional Supplies 0.3%
Mineral Resources Ltd.	337,794	1,891,078
Consumer Services 0.3%
Aristocrat Leisure Ltd.	335,131	2,533,468
Diversified Financials 0.4%
ASX Ltd.	64,304	2,128,570
Challenger Ltd.	109,831	742,940
		2,871,510
Energy 1.0%
Caltex Australia Ltd.	160,106	3,929,507
Woodside Petroleum Ltd.	166,955	3,574,506
		7,504,013
Health Care Equipment & Services 0.4%
Cochlear Ltd.	33,333	2,726,515
Household & Personal Products 0.1%
Blackmores Ltd.	7,070	860,995
Materials 0.8%
Northern Star Resources Ltd.	804,089	2,391,598
OZ Minerals Ltd.	380,210	1,687,988
Pact Group Holdings Ltd.	343,582	1,345,831
St. Barbara Ltd. *	185,023	329,238
		5,754,655
Retailing 0.3%
JB Hi-Fi Ltd.	150,654	2,506,317
Transportation 0.5%
Qantas Airways Ltd. *	1,556,921	3,796,134

Security	Number of Shares	Value ($)
Utilities 0.2%
AGL Energy Ltd.	100,000	1,385,139
		44,990,397
Austria 0.3%
Capital Goods 0.3%
ANDRITZ AG	43,944	2,466,672
Belgium 2.1%
Food, Beverage & Tobacco 0.5%
Anheuser-Busch InBev N.V.	31,801	3,945,037
Materials 0.4%
Bekaert N.V.	57,136	2,516,223
Transportation 1.2%
bpost S.A.	311,723	8,802,933
		15,264,193
Brazil 0.4%
Materials 0.1%
Fibria Celulose S.A.	86,900	767,616
Media 0.3%
Smiles S.A.	160,483	1,861,822
		2,629,438
Canada 0.4%
Automobiles & Components 0.3%
Magna International, Inc.	57,826	2,428,812
Materials 0.1%
Centerra Gold, Inc.	91,420	505,662
Dominion Diamond Corp.	13,611	156,320
		661,982
		3,090,794
China 0.2%
Consumer Durables & Apparel 0.2%
ANTA Sports Products Ltd.	438,000	1,115,686
Denmark 1.3%
Capital Goods 1.1%
Vestas Wind Systems A/S	112,789	8,073,667
Food, Beverage & Tobacco 0.1%
Royal Unibrew A/S	16,200	731,933
Transportation 0.1%
DSV A/S	25,215	1,061,505
		9,867,105
Finland 0.5%
Energy 0.2%
Neste Oyj	42,407	1,358,913
Pharmaceuticals, Biotechnology & Life Sciences 0.1%
Orion Oyj, Class B	32,588	1,138,127
Real Estate 0.1%
Sponda Oyj	150,056	653,450

See financial notes 71

Schwab International Core Equity Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Telecommunication Services 0.1%
Elisa Oyj	11,583	433,111
		3,583,601
France 10.0%
Automobiles & Components 1.8%
Peugeot S.A. *	825,055	13,296,710
Banks 1.2%
BNP Paribas S.A.	35,294	1,869,133
Credit Agricole S.A.	656,194	7,263,244
		9,132,377
Capital Goods 0.8%
Safran S.A.	27,973	1,928,449
Thales S.A.	46,044	3,984,540
		5,912,989
Consumer Durables & Apparel 1.1%
Christian Dior SE	45,541	8,002,476
Energy 0.5%
TOTAL S.A.	80,465	4,066,765
Household & Personal Products 0.7%
L'Oreal S.A.	26,772	4,863,019
Pharmaceuticals, Biotechnology & Life Sciences 3.1%
Ipsen S.A.	91,912	5,556,899
Sanofi	213,343	17,585,133
		23,142,032
Telecommunication Services 0.6%
Orange S.A.	283,550	4,710,877
Utilities 0.2%
Veolia Environnement S.A.	54,762	1,345,259
		74,472,504
Germany 10.3%
Automobiles & Components 0.5%
Bayerische Motoren Werke AG	19,509	1,804,847
Continental AG	10,020	2,206,538
		4,011,385
Banks 1.3%
Aareal Bank AG	210,925	7,508,957
Commerzbank AG	224,896	2,108,931
		9,617,888
Capital Goods 1.0%
HOCHTIEF AG	53,171	6,830,995
Pfeiffer Vacuum Technology AG	3,500	376,985
		7,207,980
Food & Staples Retailing 0.4%
METRO AG	102,597	3,273,222
Insurance 1.9%
Allianz SE - Reg'd	81,324	13,835,478
Materials 1.6%
Covestro AG *	166,632	6,591,729
Evonik Industries AG	63,367	2,010,524
LANXESS AG	21,049	1,102,328
Linde AG	12,168	1,861,727
		11,566,308

Security	Number of Shares	Value ($)
Media 1.7%
CTS Eventim AG & Co. KGaA	3,871	135,852
ProSiebenSat.1 Media SE	249,987	12,770,587
		12,906,439
Software & Services 1.0%
SAP SE	96,868	7,600,361
Telecommunication Services 0.4%
Deutsche Telekom AG - Reg'd	153,000	2,685,675
Transportation 0.2%
Deutsche Lufthansa AG - Reg'd	87,172	1,357,255
Utilities 0.3%
E.ON SE	128,042	1,327,049
RWE AG *	61,384	919,691
		2,246,740
		76,308,731
Hong Kong 4.2%
Banks 0.2%
China Construction Bank Corp., Class H	2,500,000	1,587,818
Capital Goods 0.2%
China High Speed Transmission Equipment Group Co., Ltd. *	2,261,000	1,752,244
Food, Beverage & Tobacco 0.5%
WH Group Ltd. *	4,448,500	3,593,169
Materials 0.7%
Nine Dragons Paper Holdings Ltd.	1,106,000	792,478
Sinopec Shanghai Petrochemical Co., Ltd., Class H *	8,347,000	4,094,408
		4,886,886
Real Estate 1.2%
China Resources Land Ltd.	576,000	1,415,052
New World Development Co., Ltd.	7,774,000	7,731,309
		9,146,361
Software & Services 1.4%
Tencent Holdings Ltd.	496,948	10,112,053
		31,078,531
Ireland 0.4%
Banks 0.2%
Bank of Ireland *	5,752,081	1,746,772
Consumer Services 0.2%
Paddy Power Betfair plc	8,600	1,155,799
		2,902,571
Italy 1.3%
Banks 0.5%
Intesa Sanpaolo S.p.A.	1,345,901	3,741,335
Diversified Financials 0.6%
Banca IFIS S.p.A.	72,631	2,081,984
Mediobanca S.p.A.	259,496	2,137,588
		4,219,572
Energy 0.1%
Saras S.p.A. *	608,293	1,062,497

72 See financial notes

Schwab International Core Equity Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Utilities 0.1%
ERG S.p.A.	45,028	587,034
		9,610,438
Japan 22.2%
Automobiles & Components 2.1%
Calsonic Kansei Corp.	300,000	2,049,036
Fuji Heavy Industries Ltd.	410,390	13,475,148
		15,524,184
Banks 3.5%
Mitsubishi UFJ Financial Group, Inc.	2,435,800	11,240,759
Mizuho Financial Group, Inc.	828,000	1,241,099
Resona Holdings, Inc.	2,583,100	9,131,939
Sumitomo Mitsui Financial Group, Inc.	111,400	3,352,214
The Hiroshima Bank Ltd.	294,000	1,064,375
		26,030,386
Capital Goods 2.4%
Hazama Ando Corp.	838,400	4,089,748
ITOCHU Corp.	55,300	702,786
Kanamoto Co., Ltd.	149,900	3,853,248
Kumagai Gumi Co., Ltd.	1,310,000	3,544,016
OKUMA Corp.	252,000	1,966,015
Tadano Ltd.	237,000	2,261,572
Takuma Co., Ltd.	198,000	1,702,051
		18,119,436
Commercial & Professional Supplies 0.2%
Meitec Corp.	39,000	1,352,831
Consumer Durables & Apparel 0.9%
Foster Electric Co., Ltd.	205,700	4,280,131
Fujitsu General Ltd.	162,000	2,800,808
		7,080,939
Consumer Services 0.4%
Kura Corp.	44,100	1,895,256
Round One Corp.	112,500	660,272
Toridoll.corp.	32,800	569,983
		3,125,511
Food, Beverage & Tobacco 0.4%
Japan Tobacco, Inc.	66,600	2,721,137
Health Care Equipment & Services 0.4%
Hoya Corp.	85,400	3,270,329
Insurance 0.5%
T&D Holdings, Inc.	64,000	612,638
The Dai-ichi Life Insurance Co., Ltd.	243,000	2,920,785
		3,533,423
Materials 2.1%
Sanyo Special Steel Co., Ltd.	221,000	1,005,796
Sumitomo Chemical Co., Ltd.	686,800	3,104,213
Teijin Ltd.	390,000	1,396,293
Tokyo Steel Manufacturing Co., Ltd.	992,200	6,111,483
Ube Industries Ltd.	2,011,000	3,819,469
		15,437,254
Pharmaceuticals, Biotechnology & Life Sciences 1.1%
Astellas Pharma, Inc.	518,000	6,983,977
Daiichi Sankyo Co., Ltd.	51,200	1,206,650
		8,190,627

Security	Number of Shares	Value ($)
Real Estate 0.9%
Japan Logistics Fund, Inc.	2,673	5,934,429
Premier Investment Corp.	489	623,975
		6,558,404
Retailing 1.3%
Geo Holdings Corp.	234,884	3,879,079
Nishimatsuya Chain Co., Ltd.	177,900	2,027,229
T-Gaia Corp.	313,700	3,810,049
		9,716,357
Software & Services 0.2%
Mixi, Inc.	50,000	1,708,436
Technology Hardware & Equipment 1.2%
Alps Electric Co., Ltd.	42,700	738,014
Canon, Inc.	58,600	1,638,615
Hitachi High-Technologies Corp.	94,800	2,565,064
Japan Aviation Electronics Industry Ltd.	139,000	1,855,493
Murata Manufacturing Co., Ltd.	3,400	443,398
Shimadzu Corp.	91,000	1,362,045
		8,602,629
Telecommunication Services 1.1%
KDDI Corp.	107,200	3,087,975
Nippon Telegraph & Telephone Corp.	44,000	1,969,014
NTT DOCOMO, Inc.	116,000	2,782,141
		7,839,130
Transportation 2.4%
Central Japan Railway Co.	32,245	5,648,539
Japan Airlines Co., Ltd.	340,700	12,263,256
		17,911,795
Utilities 1.1%
Chubu Electric Power Co., Inc.	207,300	2,730,586
Toho Gas Co., Ltd.	140,000	955,882
Tohoku Electric Power Co., Inc.	325,800	4,165,344
		7,851,812
		164,574,620
Malaysia 0.0%
Transportation 0.0%
AirAsia Berhad	441,700	214,414
Netherlands 3.3%
Energy 0.2%
Koninklijke Vopak N.V.	30,134	1,638,361
Food & Staples Retailing 0.5%
Koninklijke Ahold N.V.	179,585	3,910,326
Household & Personal Products 1.0%
Unilever N.V. CVA	168,731	7,412,329
Materials 0.8%
Akzo Nobel N.V.	61,260	4,352,315
Corbion N.V.	54,311	1,387,262
		5,739,577

See financial notes 73

Schwab International Core Equity Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Media 0.8%
RELX N.V.	236,616	3,973,631
Wolters Kluwer N.V.	42,381	1,614,403
		5,588,034
		24,288,627
New Zealand 0.3%
Energy 0.1%
Z Energy Ltd.	148,367	811,310
Transportation 0.2%
Air New Zealand Ltd.	840,953	1,442,948
		2,254,258
Norway 0.1%
Telecommunication Services 0.1%
Telenor A.S.A.	48,319	831,384
Republic of Korea 0.2%
Materials 0.1%
Lotte Chemical Corp.	4,323	1,102,665
Software & Services 0.1%
Com2uSCorp. *	6,200	701,445
		1,804,110
Singapore 1.4%
Banks 0.4%
DBS Group Holdings Ltd.	256,000	2,895,635
Food, Beverage & Tobacco 0.2%
Wilmar International Ltd.	565,000	1,552,041
Real Estate 0.3%
CapitaLand Ltd.	955,000	2,199,771
Retailing 0.1%
Jardine Cycle & Carriage Ltd.	29,000	829,106
Transportation 0.4%
SATS Ltd.	905,800	2,758,368
		10,234,921
Spain 2.7%
Banks 1.2%
Banco Bilbao Vizcaya Argentaria S.A.	632,348	4,345,373
Banco Santander S.A.	862,010	4,377,562
CaixaBank S.A.	151,955	458,707
		9,181,642
Media 0.5%
Mediaset Espana Comunicacion S.A.	287,719	3,746,347
Software & Services 0.1%
Amadeus IT Holding S.A., A Shares	17,239	786,104
Telecommunication Services 0.2%
Telefonica S.A.	110,046	1,203,814
Utilities 0.7%
Acciona S.A.	10,743	862,142
Endesa S.A.	191,034	4,019,330
		4,881,472
		19,799,379

Security	Number of Shares	Value ($)
Sweden 2.4%
Banks 0.4%
Nordea Bank AB	321,455	3,124,588
Capital Goods 0.2%
Peab AB	167,119	1,396,589
Commercial & Professional Supplies 0.4%
Intrum Justitia AB	80,288	2,886,064
Food & Staples Retailing 0.6%
Axfood AB	221,117	4,099,800
Food, Beverage & Tobacco 0.7%
Swedish Match AB	172,192	5,469,130
Software & Services 0.1%
NetEnt AB *	8,916	561,475
		17,537,646
Switzerland 9.5%
Capital Goods 0.6%
Schindler Holding AG	23,386	4,265,037
Consumer Durables & Apparel 0.2%
Forbo Holding AG - Reg'd *	1,153	1,404,878
Diversified Financials 0.8%
Cembra Money Bank AG *	84,448	5,794,210
Food, Beverage & Tobacco 2.3%
Nestle S.A. - Reg'd	234,907	17,533,376
Insurance 1.2%
Swiss Life Holding AG - Reg'd *	34,336	8,684,146
Materials 0.5%
EMS-Chemie Holding AG - Reg'd	2,733	1,352,471
Givaudan S.A. - Reg'd	1,131	2,232,439
		3,584,910
Pharmaceuticals, Biotechnology & Life Sciences 3.7%
Actelion Ltd. - Reg'd *	50,561	8,194,932
Lonza Group AG - Reg'd *	9,275	1,546,961
Novartis AG - Reg'd	24,055	1,830,639
Roche Holding AG	64,696	16,368,681
		27,941,213
Telecommunication Services 0.2%
Swisscom AG - Reg'd	3,108	1,579,418
		70,787,188
Taiwan 0.6%
Semiconductors & Semiconductor Equipment 0.6%
Taiwan Semiconductor Manufacturing Co., Ltd.	1,039,000	4,773,548
United Kingdom 17.8%
Banks 2.3%
Barclays plc	2,259,796	5,673,805
HSBC Holdings plc	1,768,869	11,722,073
		17,395,878
Capital Goods 1.0%
QinetiQ Group plc	1,988,658	6,513,018
Spirax-Sarco Engineering plc	18,793	938,958
		7,451,976

74 See financial notes

Schwab International Core Equity Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Consumer Durables & Apparel 0.5%
Persimmon plc	121,517	3,534,453
Diversified Financials 0.2%
IG Group Holdings plc	116,198	1,314,677
Energy 4.3%
BP plc	2,375,898	13,089,726
Royal Dutch Shell plc, B Shares	711,266	18,674,198
		31,763,924
Food, Beverage & Tobacco 2.7%
British American Tobacco plc	81,877	4,992,212
Imperial Brands plc	274,971	14,951,057
		19,943,269
Household & Personal Products 1.5%
Reckitt Benckiser Group plc	36,831	3,588,037
Unilever plc	173,736	7,762,849
		11,350,886
Insurance 0.8%
Hiscox Ltd.	30,698	404,622
Old Mutual plc	1,957,323	5,321,487
		5,726,109
Materials 0.8%
Polymetal International plc	64,355	667,103
Rio Tinto plc	168,739	5,660,571
		6,327,674
Pharmaceuticals, Biotechnology & Life Sciences 1.0%
AstraZeneca plc	30,000	1,721,178
GlaxoSmithKline plc	80,650	1,723,690
Shire plc	66,891	4,174,134
		7,619,002
Retailing 0.1%
WH Smith plc	49,021	1,200,917
Software & Services 0.8%
Moneysupermarket.com Group plc	1,267,093	5,820,544
Telecommunication Services 1.0%
BT Group plc	1,100,525	7,133,679
Transportation 0.1%
International Consolidated Airlines Group S.A.	57,899	445,145
Utilities 0.7%
Centrica plc	909,150	3,174,955
Severn Trent plc	62,378	2,033,545
		5,208,500
		132,236,633
Total Common Stock
(Cost $734,731,714)		726,717,389

Security	Number of Shares	Value ($)
Other Investment Company 1.3% of net assets
Money Market Fund 1.3%
State Street Institutional U.S. Government Money Market Fund, Premier Class 0.23% (a)	9,481,657	9,481,657
Total Other Investment Company
(Cost $9,481,657)		9,481,657

End of Investments.

At 04/30/16, the tax basis cost of the fund's investments was $744,548,494 and the unrealized appreciation and depreciation were $38,038,761 and ($46,388,209), respectively, with a net unrealized depreciation of ($8,349,448).

At 04/30/16, the values of certain foreign securities held by the fund aggregating $713,584,828 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)	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 04/30/16:

	Number of Contracts	Contract Value ($)	Unrealized Appreciation ($)
Futures Contracts
MSCI EAFE, e-mini, Long, expires 06/17/16	100	8,309,500	59,671

Expiration
Date

Counterparty

Currency
to be
Received

Amount of
Currency
to be
Received

Currency
to be
Delivered

Amount of
Currency
to be
Delivered

Unrealized
Appreciation
(Depreciation)
($)

Forward Foreign Currency Exchange Contracts

05/09/2016

State Street Bank & Trust Co.

JPY

73,189,336

USD

687,911

13,276

05/06/2016

State Street Bank & Trust Co.

USD

981,548

JPY

104,436,680

(43,810)

Net Unrealized Depreciation on Forward Foreign Currency Exchange Contracts

(30,534)

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, 2016 (see financial note 2(a) for additional information):

Assets Valuation Input

Description	Quoted Prices in Active Markets for Identical Assets (Level 1)	Other Significant Observable Inputs (Level 2)	Significant Unobservable Inputs (Level 3)	Total
Common Stock¹	$—	$696,708,530	$—	$696,708,530
Brazil ¹	2,629,438	—	—	2,629,438
Canada ¹	3,090,794	—	—	3,090,794
Netherlands ¹	—	16,876,298	—	16,876,298
Household & Personal Products	7,412,329	—	—	7,412,329
Other Investment Company¹	9,481,657	—	—	9,481,657
Total	$22,614,218	$713,584,828	$—	$736,199,046
Other Financial Instruments
Futures Contracts²	$59,671	$—	$—	$59,671
Forward Foreign Currency Exchange Contracts²	—	13,276	—	13,276
Liabilities Valuation Input

Other Financial Instruments
Forward Foreign Currency Exchange Contracts²	$—	($43,810)	$—	($43,810)

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.

76 See financial notes

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 Target 2010 Fund
Schwab Core Equity Fund	Schwab Target 2015 Fund
Schwab Dividend Equity Fund	Schwab Target 2020 Fund
Schwab Large-Cap Growth Fund	Schwab Target 2025 Fund
Schwab Small-Cap Equity Fund	Schwab Target 2030 Fund
Schwab Hedged Equity Fund	Schwab Target 2035 Fund
Schwab Financial Services Fund	Schwab Target 2040 Fund
Schwab Health Care Fund	Schwab Target 2045 Fund
Schwab International Core Equity Fund	Schwab Target 2050 Fund
Schwab ^® S&P 500 Index Fund	Schwab Target 2055 Fund
Schwab Small-Cap Index Fund^®	Schwab Fundamental US Large Company Index Fund
Schwab Total Stock Market Index Fund^®	Schwab Fundamental US Small Company Index Fund
Schwab International Index Fund^®	Schwab Fundamental International Large Company Index Fund
Schwab MarketTrack All Equity Portfolio™	Schwab Fundamental International Small Company Index Fund
Schwab MarketTrack Growth Portfolio™	Schwab Fundamental Emerging Markets Large Company Index Fund
Schwab MarketTrack Balanced Portfolio™	Schwab Fundamental Global Real Estate 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
Schwab Balanced Fund™

2. Significant Accounting Policies:

The funds invest in certain other investment companies (underlying funds). 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:

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

Schwab Active Equity Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

• Futures contracts and forward foreign currency exchange contracts (forwards): Futures contracts 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): A short-term security may be valued at its amortized cost when it approximates the security's market value.

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

Schwab Active Equity Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

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.

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, 2016 are disclosed in the Portfolio Holdings.

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

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. The terms of the securities lending agreements allow the funds or the lending agent to terminate any loan at any given time and the securities must be returned within the earlier of the standard trade settlement period or the specified time period under the relevant securities lending agreement. 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.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 lending agent fees and broker rebates, associated with securities lending activities under the trust’s Securities Lending Program paid to the unaffiliated lending agents ranged from 10% to 15%, with subsequent breakpoints to a low of 7.5%, of gross lending revenue through November 30, 2015. After December 1, 2015, the total costs and expenses to be paid to the unaffiliated lending agents start at 10% of gross lending revenue, with subsequent breakpoints to a low of 7.5%.

Schwab Active Equity Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

As of April 30, 2016, the funds had securities on loan, all of which were classified as common stocks. The value of the securities on loan and the related collateral as of April 30, 2016, if any, are disclosed in each fund's Portfolio Holdings. The value of the securities on loan and the investment of cash collateral are also disclosed in each fund's 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 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.

If a 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 a 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 a fund’s records and presented in the Statement of Operations. A fund may also incur stock loan fees which represent the cost of borrowing securities used for short sale transactions.

When a fund closes out a futures contract 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.

Schwab Active Equity Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

(d) Investment Income:

(e) Expenses:

(f) Distributions to Shareholders:

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

(g) Custody Credit:

(h) Accounting Estimates:

(i) Federal Income Taxes:

(j) Foreign Taxes:

(k) Indemnification:

Schwab Active Equity Funds

Financial Notes, unaudited (continued)

3. Risk Factors:

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.

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—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.

Dividend Paying Risk. 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, market risk and management risk, are discussed elsewhere in this section. A fund’s use of derivatives is also subject to lack of availability risk, credit risk, leverage 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 large 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. A fund's use of derivatives could reduce the fund's performance, increase its volatility, and could cause the fund to lose more than the initial amount invested.

Liquidity Risk. A fund may be unable to sell certain securities, such as illiquid securities, readily at a favorable time or price, or the fund may have to sell them at a loss.

Schwab Active Equity Funds

Financial Notes, unaudited (continued)

3. Risk Factors (continued):

Convertible Securities Risk. Convertible securities generally are debt obligations that pay income, but which may convert into common or preferred stock under certain circumstances. The value of a convertible security is influenced by the credit standing of the issuer, and changes in interest rates, with investment value declining as interest rates increase and increasing as interest rates decline. The price of a convertible security will also normally vary in some proportion to changes in the price of the underlying common stock because of the conversion or exercise feature.

ETF 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 the market for an ETF's shares 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 sale and the time the fund replaces the borrowed security.

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

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.

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.

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

Schwab Active Equity Funds

Financial Notes, unaudited (continued)

4. Affiliates and Affiliated Transactions:

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:

% of Average Daily Net Assets		Schwab Core Equity Fund		Schwab Dividend Equity Fund		Schwab Large-Cap Growth Fund		Schwab Small-Cap Equity Fund		Schwab Hedged Equity Fund		Schwab International Core Equity Fund
Flat rate		0.47%		0.62%		0.72%		0.81%		1.05%		0.58%

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

For the period ended April 30, 2016, the aggregate advisory fee paid to CSIM by the Schwab Financial Services Fund and the Schwab Health Care Fund were 0.54% and 0.53%, respectively, as a percentage of each fund's average daily net assets.

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, as distributor of the funds (or, in the case of payments made to Schwab acting as a service provider, pursuant to Schwab’s written agreement with the funds), and a fund will pay no more than 0.25% of the average annual daily net asset value of the fund shares owned by shareholders holding shares through such service provider. Payments under the Plan are made as described above without regard to whether the fee is more or less than the service provider’s actual cost of providing the services, and if more, such excess may be retained as profit by the service provider.

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

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

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

Schwab Active Equity Funds

Financial Notes, unaudited (continued)

4. Affiliates and Affiliated Transactions (continued):

Certain Schwab funds may own shares of other Schwab funds. The table below reflects the percentages of shares of each fund in this report that are owned by other Schwab funds as of April 30, 2016, as applicable:

	Underlying Funds
	Schwab Core Equity Fund	Schwab Dividend Equity Fund	Schwab Small-Cap Equity Fund	Schwab International Core Equity Fund
Schwab Target 2010 Fund	0.2%	0.1%	0.2%	0.3%
Schwab Target 2015 Fund	0.4%	0.2%	0.3%	0.5%
Schwab Target 2020 Fund	2.3%	1.3%	2.0%	3.7%
Schwab Target 2025 Fund	2.2%	1.3%	2.1%	3.6%
Schwab Target 2030 Fund	4.5%	2.6%	4.8%	7.6%
Schwab Target 2035 Fund	2.1%	1.2%	2.5%	3.7%
Schwab Target 2040 Fund	5.3%	3.1%	7.0%	9.4%
Schwab Target 2045 Fund	0.5%	0.3%	0.7%	0.9%
Schwab Target 2050 Fund	0.4%	0.2%	0.6%	0.7%
Schwab Target 2055 Fund	0.2%	0.1%	0.4%	0.4%
Schwab Monthly Income Fund - Moderate Payout	—%	0.8%	—%	—%
Schwab Monthly Income Fund - Enhanced Payout	—%	1.1%	—%	—%
Schwab Monthly Income Fund - Maximum Payout	—%	0.3%	—%	—%
Schwab Balanced Fund	4.7%	—%	—%	—%

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 on each fund’s Statement of Operations. For information regarding the trustees, please refer to the Trustees and Officers table at the end of this report.

6. Borrowing from Banks:

Schwab Active Equity Funds

Financial Notes, unaudited (continued)

6. Borrowing from Banks (continued):

7. Purchases and Sales/Maturities of Investment Securities:

For the period ended April 30, 2016, purchases and sales/maturities of securities (excluding short-term obligations) were as follows:

	Purchases of Securities	Sales/Maturities of Securities
Schwab Core Equity Fund	$818,689,666	$912,828,526
Schwab Dividend Equity Fund	485,682,611	617,277,717
Schwab Large-Cap Growth Fund	76,988,981	92,383,628
Schwab Small-Cap Equity Fund	224,761,088	248,253,804
Schwab Hedged Equity Fund*	138,820,715	150,024,707
Schwab Financial Services Fund	19,045,816	20,615,317
Schwab Health Care Fund	275,739,974	381,723,715
Schwab International Core Equity Fund	390,502,313	297,158,313

*	Including securities sold short.

8. Derivatives:

Certain funds entered into equity index futures contracts during the report period. The funds invested in futures contracts to equitize available cash. The fair value and variation margin for futures contracts held at April 30, 2016 are presented on the Portfolio Holdings and Statement of Assets and Liabilities, respectively. The net realized and change in 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 ended April 30, 2016, 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	$13,241,335	134
Schwab Dividend Equity Fund	4,155,762	42
Schwab Large-Cap Growth Fund	735,213	7
Schwab Small-Cap Equity Fund	1,516,622	14
Schwab Hedged Equity Fund	1,005,192	10
Schwab Financial Services Fund	789,514	8
Schwab Health Care Fund	3,002,271*	29*
Schwab International Core Equity Fund	8,085,321	98

* During the period, the fund did not hold futures contracts at any month-end. The average value and number of contracts were calculated by aggregating the highest daily values held each month during the period.

The Schwab International Core Equity 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 and to manage cash. 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 ended April 30, 2016, the month-end average forward foreign currency notional amount and the month-end average unrealized appreciation (depreciation) were $268,729 and ($5,089), respectively.

Schwab Active Equity Funds

Financial Notes, unaudited (continued)

8. Derivatives (continued):

As of April 30, 2016, the derivatives contracts held by the fund, categorized by primary risk exposure, were:

		Schwab International Core Equity Fund
Asset Derivatives		Fair Value
Equity Index - Futures Contracts¹		$59,671
Forward Foreign Currency Exchange Contracts²		13,276
Total		$72,947
Liability Derivatives		Fair Value
Equity Index - Futures Contracts³		$—
Forward Foreign Currency Exchange Contracts⁴		($43,810)
Total		($43,810)

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.

The effect of the derivatives held by the Schwab International Core Equity Fund in the Statement of Operations for the period ended April 30, 2016 were:

	Schwab International Core Equity Fund
Equity Index Futures Contracts
Realized Gains (Losses)¹	($114,355)
Change in Unrealized Appreciation (Depreciation)²	19,664
Forward Foreign Currency Exchange Contracts
Realized Gains (Losses)¹	$—
Change in Unrealized Appreciation (Depreciation)²	(30,534)

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.

The fund's forwards 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 fund's forwards, which are reported gross in the Statement of Assets and Liabilities, are presented in the table below. The following table presents the fund's forwards, 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, 2016.

Schwab Active Equity Funds

Financial Notes, unaudited (continued)

8. Derivatives (continued):

Schwab International Core Equity Fund

	Gross Amounts Not Offset in the Statement of Assets and Liabilities
Counterparty	Gross Amounts of Assets Presented in the Statement of Assets and Liabilities	Financial Instruments	Cash Collateral Received	Net Amounts^(a)
State Street Bank & Trust Co.	$13,276	($13,276)	$—	$—
Total	$13,276	($13,276)	$—	$—
Counterparty	Gross Amounts of Liabilities Presented in the Statement of Assets and Liabilities	Financial Instruments	Cash Collateral Pledged	Net Amounts^(b)
State Street Bank & Trust Co.	($43,810)	$13,276	$—	($30,534)
Total	($43,810)	$13,276	$—	($30,534)

^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.

9. Redemption Fee:

	Current Period (11/1/15-4/30/16)	Prior Period (11/1/14-10/31/15)
Schwab Core Equity Fund	$11,998	$22,991
Schwab Dividend Equity Fund	7,483	17,039
Schwab Large-Cap Growth Fund	346	5,458
Schwab Small-Cap Equity Fund	2,868	13,614
Schwab Hedged Equity Fund	3,365	8,264
Schwab Financial Services Fund	868	4,975
Schwab Health Care Fund	13,049	54,580
Schwab International Core Equity Fund	8,156	15,500

10. Federal Income Taxes:

Expiration Date	Schwab Core Equity Fund	Schwab Dividend Equity Fund	Schwab Large-Cap Growth Fund	Schwab Small-Cap Equity Fund	Schwab Hedged Equity Fund
October 31, 2016	$9,727,766	$—	$—	$—	$—
October 31, 2017	1,636,580	—	—	—	—
Total	$11,364,346**	$—	$—	$—	$—

Schwab Active Equity Funds

Financial Notes, unaudited (continued)

10. Federal Income Taxes (continued):

Expiration Date	Schwab Financial Services Fund	Schwab Health Care Fund	Schwab International Core Equity Fund
October 31, 2017	$17,740,785	$—	$—
October 31, 2018	170,394	—	—
October 31, 2019	—	—	7,906,336
No expiration*	—	—	5,159,909
Total	$17,911,179	$—	$13,066,245**

*	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.
**	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.

11. Subsequent Events:

At a meeting held on June 1, 2016, the Board of the trust approved the liquidation of the Schwab Financial Services Fund (the Fund). Accordingly, effective at market close on June 7, 2016, the Fund is closed to new investment from all investors except for additional investment by existing qualified retirement plans. The Fund will redeem all of its outstanding shares on or about August 9, 2016 (the Liquidation Date), and distribute the proceeds to the Fund’s shareholders (subject to maintenance of appropriate reserves for liquidation and other expenses). As shareholders redeem shares of the Fund through the Liquidation Date, the Fund may not be able to continue to invest its assets in accordance with its stated investment policies as a result of the decrease in the Fund’s assets. On or about the Liquidation Date, all portfolio holdings of the Fund will be converted to cash, cash equivalents or other liquid assets.

Other than the planned liquidation of Schwab Financial Services Fund as discussed above, management has determined there are no other subsequent events or transactions through the date the financial statements were issued that would have materially impacted the financial statements as presented.

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 and Laudus Trust. The Fund Complex includes 97 funds.

Independent Trustees
Name, Year of Birth, and Position(s) with the trust (Terms of office, and length of Time Served¹)	Principal Occupations During the Past Five Years	Number of Portfolios in Fund Complex Overseen by the Trustee	Other Directorships
Robert W. Burns 1959 Trustee (Trustee of Schwab Strategic Trust since 2009; The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios and Laudus Trust since 2016)	Retired/Private Investor (Jan. 2009 – present). Formerly, Managing Director, Pacific Investment Management Company, LLC (PIMCO) and President, PIMCO Funds.	97	Director, PS Business Parks, Inc. (2005 – 2012)
John F. Cogan 1947 Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust and Schwab Annuity Portfolios since 2008; Laudus Trust since 2010; Schwab Strategic Trust since 2016)	Senior Fellow, The Hoover Institution at Stanford University (Oct. 1979 – present); Senior Fellow, Stanford Institute for Economic Policy Research (2000 – present); Professor of Public Policy, Stanford University (1994 – 2015).	97	Director, Gilead Sciences, Inc. (2005 – present)
Stephen Timothy Kochis 1946 Trustee (Trustee of Schwab Strategic Trust since 2012; The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios and Laudus Trust since 2016)	CEO and Owner, Kochis Global (wealth management consulting) (May 2012 – present); Chairman and CEO, Aspiriant, LLC (wealth management) (Jan. 2008 – Apr. 2012).	97	None
David L. Mahoney 1954 Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios and Laudus Trust since 2011; Schwab Strategic Trust since 2016)	Private Investor.	97	Director, Symantec Corporation (2003 – present) Director, Corcept Therapeutics Incorporated (2004 – present) Director, Adamas Pharmaceuticals, Inc. (2009 – present)
Kiran M. Patel 1948 Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios and Laudus Trust since 2011; Schwab Strategic Trust since 2016)	Retired. Executive Vice President and General Manager of Small Business Group, Intuit, Inc. (financial software and services firm for consumers and small businesses) (Dec. 2008 – Sept. 2013).	97	Director, KLA-Tencor Corporation (2008 – present)

Independent Trustees (continued)
Name, Year of Birth, and Position(s) with the trust (Terms of office, and length of Time Served¹)	Principal Occupations During the Past Five Years	Number of Portfolios in Fund Complex Overseen by the Trustee	Other Directorships
Kimberly S. Patmore 1956 Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2016)	Consultant, Patmore Management Consulting (management consulting) (2008 – present).	97	None
Charles A. Ruffel 1956 Trustee (Trustee of Schwab Strategic Trust since 2009; The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios and Laudus Trust since 2015)	Co-Chief Executive Officer, Kudu Investment Management, LLC (financial services) (Jan. 2015 – present); Partner, Kudu Advisors, LLC (financial services) (June 2008 – Jan. 2015); Advisor, Asset International, Inc. (publisher of financial services information) (Aug. 2008 – Jan. 2015).	97	None
Gerald B. Smith 1950 Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust and Schwab Annuity Portfolios since 2000; Laudus Trust since 2010; Schwab Strategic Trust since 2016)	Chairman, Chief Executive Officer and Founder of Smith Graham & Co. (investment advisors) (Mar. 1990 – present).	97	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 The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust and Schwab Annuity Portfolios since 2008; Laudus Trust since 2010; Schwab Strategic Trust since 2016)	Senior Consultant, Goldman Sachs & Co., Inc. (investment banking and securities firm) (Jan. 2008 – present); Partner, Colgin Partners, LLC (vineyards) (Feb. 1998 – present).	97	Board Member and Chairman of the Audit Committee, Isis Pharmaceuticals (1994 – present) Lead Independent Director and Chair of Audit Committee, OUTFRONT Media Inc. (2014 – present)

Interested Trustees
Name, Year of Birth, and Position(s) with the trust (Terms of office, and length of Time Served¹)	Principal Occupations During the Past Five Years	Number of Portfolios in Fund Complex Overseen by the Trustee	Other Directorships
Walter W. Bettinger II² 1960 Chairman and Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust and Schwab Annuity Portfolios since 2008; Schwab Strategic Trust since 2009; Laudus Trust since 2010)	Director, President and Chief Executive Officer, The Charles Schwab Corporation (Oct. 2008 – present); President and Chief Executive Officer (Oct. 2008 – present), Director (May 2008 – present), Charles Schwab & Co., Inc.; Director, Charles Schwab Bank (Apr. 2006 – present); and Director, Schwab Holdings, Inc. (May 2008 – present).	97	Director, The Charles Schwab Corporation (2008 – present)

Interested Trustees (continued)
Name, Year of Birth, and Position(s) with the trust (Terms of office, and length of Time Served¹)	Principal Occupations During the Past Five Years	Number of Portfolios in Fund Complex Overseen by the Trustee	Other Directorships
Marie A. Chandoha² 1961 Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2016)	Director, President and Chief Executive Officer (Dec. 2010 – present), Chief Investment Officer (Sept. 2010 – Oct. 2011), Charles Schwab Investment Management, Inc.; Trustee (Jan. 2016 – present), President, Chief Executive Officer (Dec. 2010 – present), and Chief Investment Officer (Sept. 2010 – Oct. 2011), Schwab Funds, Laudus Funds and Schwab ETFs; Director, Charles Schwab Worldwide Funds plc and Charles Schwab Asset Management (Ireland) Limited (Jan. 2011 – present); Global Head of Fixed Income Business Division, BlackRock, Inc. (formerly Barclays Global Investors) (Mar. 2007 – Aug. 2010).	97	None
Joseph R. Martinetto² 1962 Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2016)	Senior Executive Vice President and Chief Financial Officer, The Charles Schwab Corporation and Charles Schwab & Co., Inc. (July 2015 – present); Executive Vice President and Chief Financial Officer of The Charles Schwab Corporation and Charles Schwab & Co., Inc. (May 2007 – July 2015); Director, Charles Schwab & Co., Inc. (May 2007 – present); Director (Apr. 2010 – present) and Chief Executive Officer (July 2013 – Apr. 2015), Charles Schwab Bank; Director, Executive Vice President and Chief Financial Officer, Schwab Holdings, Inc. (May 2007 – present).	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 A. Chandoha 1961 President and Chief Executive Officer (Officer of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2010)	Director, President and Chief Executive Officer (Dec. 2010 – present), Chief Investment Officer (Sept. 2010 – Oct. 2011), Charles Schwab Investment Management, Inc.; Trustee (Jan. 2016 – present), President, Chief Executive Officer (Dec. 2010 – present), and Chief Investment Officer (Sept. 2010 – Oct. 2011), Schwab Funds, Laudus Funds and Schwab ETFs; Director, Charles Schwab Worldwide Funds plc and Charles Schwab Asset Management (Ireland) Limited (Jan. 2011 – present); Global Head of Fixed Income Business Division, BlackRock, Inc. (formerly Barclays Global Investors) (Mar. 2007 – Aug. 2010).
Mark Fischer 1970 Treasurer and Chief Financial Officer (Officer of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2013)	Treasurer and Chief Financial Officer, Schwab Funds, Laudus Funds and Schwab ETFs (Jan. 2016 – present); Assistant Treasurer, Schwab Funds and Laudus Funds (Dec. 2013 – Dec. 2015), Schwab ETFs (Nov. 2013 – Dec. 2015); Vice President, Charles Schwab Investment Management, Inc. (Oct. 2013 – present); Executive Director, J.P. Morgan Investor Services (Apr. 2011 – Sept. 2013); Assistant Treasurer, Massachusetts Financial Service Investment Management (May 2005 – Mar. 2011).

Officers of the Trust (continued)
Name, Year of Birth, and Position(s) with the trust (Terms of office, and length of Time Served³)	Principal Occupations During the Past Five Years
George Pereira 1964 Senior Vice President and Chief Operating Officer (Officer of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust and Schwab Annuity Portfolios since 2004; Laudus Trust since 2006; Schwab Strategic Trust since 2009)	Senior Vice President and Chief Financial Officer (Nov. 2004 – present), Chief Operating Officer (Jan. 2011 – present), Charles Schwab Investment Management, Inc.; Senior Vice President and Chief Operating Officer (Jan. 2016 – present), Treasurer and Chief Financial Officer, Laudus Funds (June 2006 – Dec. 2015); Treasurer and Principal Financial Officer, Schwab Funds (Nov. 2004 – Dec. 2015) and Schwab ETFs (Oct. 2009 – Dec. 2015); Director, Charles Schwab Worldwide Funds plc and Charles Schwab Asset Management (Ireland) Limited (Apr. 2005 – present).
Omar Aguilar 1970 Senior Vice President and Chief Investment Officer – Equities (Officer of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2011)	Senior Vice President and Chief Investment Officer – Equities, Charles Schwab Investment Management, Inc. (Apr. 2011 – present); Senior Vice President and Chief Investment Officer – Equities, Schwab Funds, Laudus Funds and Schwab ETFs (June 2011 – present); Head of the Portfolio Management Group and Vice President of Portfolio Management, Financial Engines, Inc. (May 2009 – Apr. 2011); Head of Quantitative Equity, ING Investment Management (July 2004 – Jan. 2009).
Brett Wander 1961 Senior Vice President and Chief Investment Officer – Fixed Income (Officer of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2011)	Senior Vice President and Chief Investment Officer – Fixed Income, Charles Schwab Investment Management, Inc. (Apr. 2011 – present); Senior Vice President and Chief Investment Officer – Fixed Income, Schwab Funds, Laudus Funds and Schwab ETFs (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 (Apr. 2006 – Jan. 2008).
David Lekich 1964 Chief Legal Officer and Secretary, Schwab Funds and Schwab ETFs Vice President and Assistant Clerk, Laudus Funds (Officer of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2011)	Senior Vice President (Sept. 2011 – present), Vice President (Mar. 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 (Apr. 2011 – present) and Chief Legal Officer (Dec. 2011 – present), Schwab Funds; Vice President and Assistant Clerk, Laudus Funds (Apr. 2011 – present); Secretary (May 2011 – present) and Chief Legal Officer (Nov. 2011 – present), Schwab ETFs.
Catherine MacGregor 1964 Vice President and Assistant Secretary, Schwab Funds and Schwab ETFs Chief Legal Officer, Vice President and Clerk, Laudus Funds (Officer of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios and Laudus Trust since 2005; Schwab Strategic Trust since 2009)	Vice President, Charles Schwab & Co., Inc., Charles Schwab Investment Management, Inc. (July 2005 – present); Vice President (Dec. 2005 – present), Chief Legal Officer and Clerk (Mar. 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	Each Trustee shall hold office until the election and qualification of his or her successor, or until he or she dies, resigns or is removed. The retirement policy requires that each independent trustee retire by December 31 of the year in which the Trustee turns 74 or the Trustee’s twentieth year of service as an independent trustee on any trust in the Fund Complex, whichever occurs first.
²	Mr. Bettinger, Ms. Chandoha, and Mr. Martinetto 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/Clerk 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.

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.

cap, capitalization See “market cap.”

Dividend Equity Spliced An internally calculated index, comprised of the S&P 500 Index from inception of the Schwab Dividend Equity Fund until the close of business on February 27, 2015 and the Russell 1000 Value Index thereafter.

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

FTSE EPRA/NAREIT Global Index An index that is designed to provide a diverse representation of publicly traded equity real estate investment trusts (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.

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.

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 1000 Value Index An index that measures the performance of the large-cap segment of the U.S. equity universe.

Proxy Voting Policies, Procedures and Results

The Schwab Funds Family^®

Stock Funds

Asset Allocation Funds

Bond Funds

Schwab Money Funds

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 many seek to preserve the value of your investment at $1 per share, it is possible to lose money.

Performance at a Glance

Total Return for the 6 Months Ended April 30, 2016
Schwab Fundamental US Large Company Index Fund (Ticker Symbol: SFLNX)	2.82%
Russell Fundamental U.S. Large Company Index	2.96%
Fund Category: Morningstar Large Value	0.34%
Performance Details	page 8

Schwab Fundamental US Small Company Index Fund (Ticker Symbol: SFSNX)	1.30%
Russell Fundamental U.S. Small Company Index	1.45%
Fund Category: Morningstar Small Blend	-1.06%
Performance Details	page 9

Schwab Fundamental International Large Company Index Fund¹ (Ticker Symbol: SFNNX)	-1.94%
Russell Fundamental Developed ex-U.S. Large Company Index (Net)²	-1.36%
Fund Category: Morningstar Foreign Large Value	-2.64%
Performance Details	pages 10-11

Total Return for the 6 Months Ended April 30, 2016
Schwab Fundamental International Small Company Index Fund¹ (Ticker Symbol: SFILX)	3.12%
Russell Fundamental Developed ex-U.S. Small Company Index (Net)²	4.23%
Fund Category: Morningstar Foreign Small/Mid Blend	0.87%
Performance Details	pages 12-13

Schwab Fundamental Emerging Markets Large Company Index Fund¹ (Ticker Symbol: SFENX)	7.87%
Russell Fundamental Emerging Markets Large Company Index (Net)²	8.01%
Fund Category: Morningstar Diversified Emerging Markets	-0.26%
Performance Details	pages 14-15

Minimum Initial Investment³

$100

For index definitions, please see the Glossary.

Index ownership— each of the names identifying the Russell Fundamental Index Series is a joint trademark of Frank Russell Company (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 funds.

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	The net version of the index reflects reinvested dividends net of withholding taxes, but reflects no deductions for expenses or other taxes.
³	Please see the funds' prospectus for further detail and eligibility requirements.

2Schwab 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,

The six-month reporting period ended April 30, 2016, proved tumultuous for most equity markets, as investors tried to assess whether slowing growth overseas would knock the U.S. recovery off course. Over this time, the S&P 500^® Index dropped as much as 12%, only to end the six months back in slightly positive territory. Emerging market stocks rallied as commodity prices rebounded, while developed market equities remained weighed down by uncertainty regarding the health of the global economy. Despite this heightened volatility, the Schwab Fundamental Index Funds generally tracked their respective indices and most of the funds ended the period with positive returns. The Schwab Fundamental International Large Company Index Fund, however, generated negative returns for the reporting period, as many international developed stocks continued to struggle against soft global economic growth. By comparison, a weakening U.S. dollar helped support the returns of the Schwab Fundamental Emerging Markets Large Company Index Fund, which had the strongest performance among the Schwab Fundamental Index Funds for the period.

In recent years, Fundamental Index strategies have experienced considerable asset growth. While traditional market-cap weighted strategies provide the largest weighting to the largest companies based on their respective market capitalization, Fundamental Index strategies take a different approach. Fundamental Index strategies rely on objective non-price measures such as

Asset Class Performance Comparison % returns during the six months ended 4/30/2016

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.

* The net version of the index reflects reinvested dividends net of withholding taxes, but reflects no deductions for expenses or other taxes.

Schwab Fundamental Index Funds3

From the President continued

At Charles Schwab Investment Management, we believe that our Fundamental Index Funds can be part of the foundation of an investor’s diversified portfolio.

adjusted sales, retained cash flow, and dividends plus buybacks, rather than market capitalization, when determining the weight of a security. As a result, Fundamental Index funds tend to outperform when investors are focused on value, and lag when the biggest companies are leading the market.

At Charles Schwab Investment Management, we believe that our Fundamental Index Funds can be part of the foundation of an investor’s diversified portfolio. By following a rules-based discipline, we believe that Fundamental Index strategies help remove the emotions that can inhibit performance while capturing many of the positive attributes of both traditional market-cap weighted and active management strategies. And because Fundamental Index and market-cap weighted approaches tend to perform well in different market environments, we believe that a blend of cap-weighted and Fundamental Index products in an investor’s portfolio makes sense.

I want to thank you for investing with Charles Schwab Investment Management, and for trusting us to help you achieve your financial goals. For more information about the Schwab Fundamental Index Funds, please continue reading this report or visit our website at www.csimfunds.com. We are also happy to hear from you at 1-877-824-5615.

Sincerely,

4Schwab Fundamental Index Funds

The Investment Environment

Schwab Fundamental Index Funds5

The Investment Environment continued

During the reporting period, sharp fluctuations in oil and commodity prices continued to add to market volatility and created extra pressure in credit markets. Overall demand for oil failed to keep pace with supply, resulting in excess reserves across the globe. In December, the Organization of the Petroleum Exporting Countries (OPEC) decided to maintain current production levels despite excess supply, causing oil prices to drop even further. Falling oil prices negatively affected many emerging market economies and corporations that are highly dependent on energy revenues, and created stress in the high-yield corporate credit market. Many financial institutions also felt the effects of oil and commodity price fluctuations, as credit spreads widened and losses from loans to energy firms weighed on returns. The Fed’s dovish monetary policy and an agreement by several key OPEC members to limit supply helped oil to rally in February, and also supported a rebound in many global stocks. Despite additional price fluctuations toward the end of the reporting period, oil finished its best month of the year in April.

With diverging central bank policies, sharp oil price fluctuations, and continued weak global economic growth, the six-month reporting period saw heightened levels of volatility in both U.S. and international stock markets. Fed policy and a weaker U.S. dollar helped many emerging markets, while also counteracting some accommodative policy measures in Europe and Japan. The state of China’s economy remained a large factor in investor sentiment across the globe, though some signs of improvement emerged toward the end of the reporting period. Overall, U.S. and international equities were affected by many of the same factors, and were not immune to the impacts of an uncertain global economic environment.

Index figures assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged and cannot be invested in directly. Performance results less than one year are not annualized. Past performance is not an indication of future results.

For index definitions, please see the Glossary.

Management views may have changed since the report date.

6Schwab Fundamental Index Funds

Fund Management

Jane Qin, Portfolio Manager, is responsible for the day-to-day co-management of 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. Prior to joining CSIM in December 2012, Ms. Qin spent more than four years at The Bank of New York Mellon Corporation. During that time, Ms. Qin spent more than two years as an associate equity portfolio manager and nearly two years as a performance analyst. She also worked at Wells Fargo Funds Management as a mutual fund analyst and at CIGNA Reinsurance in Risk Management group as a risk analyst.

Schwab Fundamental Index Funds7

Schwab Fundamental US Large Company Index Fund

Performance and Fund Facts as of 04/30/16

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)	2.82%	0.82%	10.31%	6.96%
Russell Fundamental U.S. Large Company Index⁴	2.96%	1.10%	11.05%	N/A
Fundamental U.S. Large Company Spliced Index	2.96%	1.10%	10.70%	7.19%
Fund Category: Morningstar Large Value	0.34%	-2.54%	8.51%	4.12%

Fund Expense Ratios⁵: Net 0.35%; Gross 0.39%

Statistics
Number of Holdings	619
Weighted Average Market Cap (millions)	$116,753
Price/Earnings Ratio (P/E)	34.7
Price/Book Ratio (P/B)	2.2
Portfolio Turnover Rate	4%

Sector Weightings % of Investments
Energy	14.8%
Information Technology	13.5%
Financials	13.0%
Consumer Discretionary	12.4%
Consumer Staples	11.6%
Health Care	10.5%
Industrials	10.5%
Utilities	4.5%
Telecommunication Services	4.2%
Materials	4.0%
Other	1.0%
Total	100.0%

Top Equity Holdings % of Net Assets⁶
Exxon Mobil Corp.	4.8%
Chevron Corp.	2.9%
AT&T, Inc.	2.5%
Microsoft Corp.	1.8%
Wal-Mart Stores, Inc.	1.5%
The Procter & Gamble Co.	1.4%
Apple, Inc.	1.4%
International Business Machines Corp.	1.4%
General Electric Co.	1.4%
Verizon Communications, Inc.	1.3%
Total	20.4%

For index definitions, please see the Glossary.

Index ownership – "Russell Fundamental U.S. Large Company Index" is a joint trademark of Frank Russell Company (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 US Large Company Index Fund is 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, and the fund no longer offers multiple classes of shares. The performance history of the fund prior to October 27, 2009 is that of the fund’s former Institutional Shares.
⁴	The inception date of the Russell Fundamental U.S. Large Company Index is February 24, 2011. The fund began tracking the index on October 19, 2012.
⁵	As stated in the prospectus. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as the investment 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	This list is not a recommendation of any security by the investment adviser.

8Schwab Fundamental Index Funds

Schwab Fundamental US Small Company Index Fund

Performance and Fund Facts as of 04/30/16

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)	1.30%	-3.16%	8.35%	7.35%
Russell Fundamental U.S. Small Company Index⁴	1.45%	-2.90%	9.12%	N/A
Fundamental U.S. Small Company Spliced Index	1.45%	-2.90%	8.65%	7.88%
Fund Category: Morningstar Small Blend	-1.06%	-5.31%	6.51%	4.88%

Fund Expense Ratios⁵: Net 0.35%; Gross 0.43%

Statistics
Number of Holdings	867
Weighted Average Market Cap (millions)	$4,137
Price/Earnings Ratio (P/E)	96.9
Price/Book Ratio (P/B)	1.8
Portfolio Turnover Rate	11%

Sector Weightings % of Investments
Financials	21.9%
Industrials	20.1%
Consumer Discretionary	15.6%
Information Technology	12.3%
Health Care	6.3%
Materials	6.1%
Energy	5.4%
Utilities	4.1%
Consumer Staples	3.5%
Telecommunication Services	1.2%
Other	3.5%
Total	100.0%

Top Equity Holdings % of Net Assets⁶
WPX Energy, Inc.	0.3%
Advanced Micro Devices, Inc.	0.3%
Edwards Lifesciences Corp.	0.3%
Cabot Corp.	0.3%
SkyWest, Inc.	0.3%
Valmont Industries, Inc.	0.3%
Copart, Inc.	0.3%
Equinix, Inc.	0.3%
IDEXX Laboratories, Inc.	0.3%
Sanmina Corp.	0.3%
Total	3.0%

For index definitions, please see the Glossary.

Index ownership – "Russell Fundamental U.S. Small Company Index" is a joint trademark of Frank Russell Company (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 US Small Company Index Fund is 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, and the fund no longer offers multiple classes of shares. The performance history of the fund prior to October 27, 2009 is that of the fund’s former Institutional Shares.
⁴	The inception date of the Russell Fundamental U.S. Small Company Index is February 24, 2011. The fund began tracking the index on October 19, 2012.
⁵	As stated in the prospectus. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as the investment 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	This list is not a recommendation of any security by the investment adviser.

Schwab Fundamental Index Funds9

Schwab Fundamental International Large Company Index Fund

Performance and Fund Facts as of 04/30/16

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)	-1.94%	-9.97%	0.38%	0.29%
Russell Fundamental Developed ex-U.S. Large Company Index (Net)^4,5	-1.36%	-9.24%	1.13%	N/A
Fundamental Developed ex-U.S. Large Company Spliced Index	-1.36%	-9.24%	0.90%	1.10%
Fund Category: Morningstar Foreign Large Value	-2.64%	-10.74%	0.33%	-0.39%

Fund Expense Ratios⁶: Net 0.35%; Gross 0.46%

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 Frank Russell Company (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 International Large Company Index Fund is 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, and the fund no longer offers multiple classes of shares. The performance history of the fund prior to October 19, 2009 is that of the fund’s former Institutional Shares.
⁴	The net version of the index reflects reinvested dividends net of withholding taxes, but reflects no deductions for expenses or other taxes.
⁵	The inception date of the Russell Fundamental Developed ex-U.S. Large Company Index (Net) is February 24, 2011. The fund began tracking the index on October 19, 2012.
⁶	As stated in the prospectus. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as the investment 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.

10Schwab Fundamental Index Funds

Schwab Fundamental International Large Company Index Fund

Performance and Fund Facts as of 04/30/16 continued

Statistics
Number of Holdings	846
Weighted Average Market Cap (millions)	$52,751
Price/Earnings Ratio (P/E)	59.6
Price/Book Ratio (P/B)	1.3
Portfolio Turnover Rate	6%

Sector Weightings % of Investments
Financials	18.3%
Energy	13.8%
Industrials	12.4%
Consumer Discretionary	10.3%
Consumer Staples	10.0%
Materials	9.7%
Telecommunication Services	6.8%
Health Care	6.3%
Utilities	6.2%
Information Technology	3.6%
Other	2.6%
Total	100.0%

Top Equity Holdings % of Net Assets¹
BP plc	2.2%
Royal Dutch Shell plc, A Shares	2.2%
TOTAL S.A.	2.1%
Royal Dutch Shell plc, B Shares	1.6%
Banco Santander S.A.	1.2%
Nestle S.A. – Reg'd	1.1%
HSBC Holdings plc	1.0%
Eni S.p.A.	1.0%
Vodafone Group plc	0.9%
Telefonica S.A.	0.9%
Total	14.2%

Country Weightings % of Investments

Japan	20.0%
United Kingdom	15.7%
France	10.3%
Germany	8.9%
Canada	7.5%
Australia	5.9%

Netherlands	5.9%
Switzerland	5.8%
Spain	4.1%
Italy	3.2%
Other Countries	12.7%
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	This list is not a recommendation of any security by the investment adviser.

Schwab Fundamental Index Funds11

Schwab Fundamental International Small Company Index Fund

Performance and Fund Facts as of 04/30/16

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)	3.12%	-1.19%	3.95%	5.05%
Russell Fundamental Developed ex-U.S. Small Company Index (Net)^4,5	4.23%	0.36%	5.58%	N/A
Fundamental Developed ex-U.S. Small Company Spliced Index	4.23%	0.36%	4.85%	6.53%
Fund Category: Morningstar Foreign Small/Mid Blend	0.87%	-4.09%	3.79%	3.61%

Fund Expense Ratios⁶: Net 0.49%; Gross 0.71%

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 Frank Russell Company (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 International Small Company Index Fund is 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, and the fund no longer offers multiple classes of shares. The performance history of the fund prior to October 19, 2009 is that of the fund’s former Institutional Shares.
⁴	The net version of the index reflects reinvested dividends net of withholding taxes, but reflects no deductions for expenses or other taxes.
⁵	The inception date of the Russell Fundamental Developed ex-U.S. Small Company Index (Net) is February 24, 2011. The fund began tracking the index on October 19, 2012.
⁶	As stated in the prospectus. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as the investment 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.

12Schwab Fundamental Index Funds

Schwab Fundamental International Small Company Index Fund

Performance and Fund Facts as of 04/30/16 continued

Statistics
Number of Holdings	1,376
Weighted Average Market Cap (millions)	$3,140
Price/Earnings Ratio (P/E)	43.6
Price/Book Ratio (P/B)	1.3
Portfolio Turnover Rate	16%

Sector Weightings % of Investments
Industrials	22.7%
Consumer Discretionary	17.4%
Financials	15.9%
Materials	11.6%
Information Technology	8.5%
Consumer Staples	8.2%
Health Care	4.8%
Energy	3.7%
Utilities	1.5%
Telecommunication Services	1.4%
Other	4.3%
Total	100.0%

Top Equity Holdings % of Net Assets¹
iShares MSCI EAFE Small Cap ETF	0.7%
IAMGOLD Corp.	0.2%
Evraz plc	0.2%
Agnico-Eagle Mines Ltd.	0.2%
Nichirei Corp.	0.2%
OZ Minerals Ltd.	0.2%
Nippon Building Fund, Inc.	0.2%
Italcementi S.p.A.	0.2%
Sigma Pharmaceuticals Ltd.	0.2%
Treasury Wine Estates Ltd.	0.2%
Total	2.5%

Country Weightings % of Investments

Japan	36.6%
United Kingdom	10.8%
Canada	8.9%
Australia	6.2%
United States	4.3%

France	4.3%
Germany	3.5%
Switzerland	2.9%
Other Countries	22.5%
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	This list is not a recommendation of any security by the investment adviser.

Schwab Fundamental Index Funds13

Schwab Fundamental Emerging Markets Large Company Index Fund

Performance and Fund Facts as of 04/30/16

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)	7.87%	-15.35%	-6.35%	-1.50%
Russell Fundamental Emerging Markets Large Company Index (Net)^4,5	8.01%	-14.97%	-4.98%	N/A
Fundamental Emerging Markets Large Company Spliced Index	8.01%	-14.97%	-5.22%	0.05%
Fund Category: Morningstar Diversified Emerging Markets	-0.26%	-15.37%	-4.31%	-1.28%

Fund Expense Ratios⁶: Net 0.49%; Gross 0.85%

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 Frank Russell Company (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 Emerging Markets Large Company Index Fund is 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, and the fund no longer offers multiple classes of shares. The performance history of the fund prior to October 19, 2009 is that of the fund’s former Institutional Shares.
⁴	The net version of the index reflects reinvested dividends net of withholding taxes, but reflects no deductions for expenses or other taxes.
⁵	The inception date of the Russell Fundamental Emerging Markets Large Company Index (Net) is February 24, 2011. The fund began tracking the index on October 19, 2012.
⁶	As stated in the prospectus. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as the investment 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.

14Schwab Fundamental Index Funds

Schwab Fundamental Emerging Markets Large Company Index Fund

Performance and Fund Facts as of 04/30/16 continued

Statistics
Number of Holdings	298
Weighted Average Market Cap (millions)	$47,003
Price/Earnings Ratio (P/E)	20.0
Price/Book Ratio (P/B)	0.9
Portfolio Turnover Rate	11%

Sector Weightings % of Investments
Energy	27.0%
Financials	18.5%
Information Technology	14.5%
Materials	12.2%
Telecommunication Services	8.8%
Consumer Discretionary	6.1%
Industrials	4.2%
Consumer Staples	3.7%
Utilities	3.6%
Other	1.4%
Total	100.0%

Top Equity Holdings % of Net Assets¹
Samsung Electronics Co., Ltd.	4.5%
Gazprom PAO	3.4%
Lukoil PJSC	2.9%
Petroleo Brasileiro S.A. Preferred Stock	2.4%
China Mobile Ltd.	1.9%
China Construction Bank Corp., Class H	1.9%
Petroleo Brasileiro S.A. Common Stock	1.9%
Vale S.A. Preferred Stock	1.7%
Gazprom PAO ADR	1.7%
Taiwan Semiconductor Manufacturing Co., Ltd.	1.6%
Total	23.9%

Country Weightings % of Investments

Republic of Korea	17.5%
Brazil	17.0%
Russia	14.8%
China	14.2%
Taiwan	10.6%

South Africa	6.4%
India	3.8%
Mexico	3.4%
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	This list is not a recommendation of any security by the investment adviser.

Schwab Fundamental Index Funds15

Fund Expenses (Unaudited)

Examples for a $1,000 Investment

	Expense Ratio¹ (Annualized)	Beginning Account Value at 11/1/15	Ending Account Value (Net of Expenses) at 4/30/16	Expenses Paid During Period² 11/1/15–4/30/16
Schwab Fundamental US Large Company Index Fund
Actual Return	0.35%	$1,000.00	$ 1,028.20	$ 1.77
Hypothetical 5% Return	0.35%	$1,000.00	$ 1,023.16	$ 1.76
Schwab Fundamental US Small Company Index Fund
Actual Return	0.35%	$1,000.00	$ 1,013.00	$ 1.75
Hypothetical 5% Return	0.35%	$1,000.00	$ 1,023.16	$ 1.76
Schwab Fundamental International Large Company Index Fund
Actual Return	0.35%	$1,000.00	$ 980.60	$ 1.72
Hypothetical 5% Return	0.35%	$1,000.00	$ 1,023.16	$ 1.76
Schwab Fundamental International Small Company Index Fund
Actual Return	0.49%	$1,000.00	$ 1,031.20	$ 2.47
Hypothetical 5% Return	0.49%	$1,000.00	$1,022.46	$2.46
Schwab Fundamental Emerging Markets Large Company Index Fund
Actual Return	0.49%	$1,000.00	$ 1,078.70	$ 2.53
Hypothetical 5% Return	0.49%	$1,000.00	$1,022.46	$2.46

¹	Based on the most recent six-month expense ratio; may differ from the expense ratio provided in the Financial Highlights. This ratio also does not include certain non-routine expenses, such as proxy expenses.
²	Expenses for each fund are equal to its annualized expense ratio, multiplied by the average account value over the period, multiplied by the 182 days of the period, and divided by the 366 days of the fiscal year.

16Schwab Fundamental Index Funds

Schwab Fundamental US Large Company Index Fund

Financial Statements

Financial Highlights

	11/1/15– 4/30/16*	11/1/14– 10/31/15	11/1/13– 10/31/14	11/1/12– 10/31/13	11/1/11– 10/31/12	11/1/10– 10/31/11
Per-Share Data
Net asset value at beginning of period	$15.14	$15.56	$13.65	$10.76	$9.51	$9.05
Income (loss) from investment operations:
Net investment income (loss)	0.17 ¹	0.33 ¹	0.26	0.24	0.21	0.18
Net realized and unrealized gains (losses)	0.21	(0.10)	1.87	2.89	1.22	0.43
Total from investment operations	0.38	0.23	2.13	3.13	1.43	0.61
Less distributions:
Distributions from net investment income	(0.34)	(0.26)	(0.22)	(0.24)	(0.18)	(0.15)
Distributions from net realized gains	(0.46)	(0.39)	—	—	—	—
Total distributions	(0.80)	(0.65)	(0.22)	(0.24)	(0.18)	(0.15)
Net asset value at end of period	$14.72	$15.14	$15.56	$13.65	$10.76	$9.51
Total return	2.82% ²	1.44%	15.74%	29.67%	15.29%	6.74%
Ratios/Supplemental Data
Ratios to average net assets:
Net operating expenses	0.35% ³	0.35%	0.35%	0.35%	0.32% ⁴	0.35%
Gross operating expenses	0.39% ³	0.39%	0.39%	0.41%	0.44%	0.44%
Net investment income (loss)	2.48% ³	2.16%	1.95%	2.03%	2.13%	2.06%
Portfolio turnover rate	4% ²	12%	14%	10%	32% ⁵	11%
Net assets, end of period (x 1,000,000)	$4,725	$4,886	$4,465	$3,020	$1,960	$1,490

*	Unaudited.

Calculated based on the average shares outstanding during the period.

Not annualized.

Annualized (except for proxy costs).

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 17

Schwab Fundamental US Large Company Index Fund

Condensed Portfolio Holdings as of April 30, 2016 (Unaudited)

Holdings by Category		Cost ($)	Value ($)
99.3%	Common Stock	3,806,801,193	4,691,577,069
1.0%	Other Investment Companies	46,879,921	46,879,921
100.3%	Total Investments	3,853,681,114	4,738,456,990
(0.3%)	Other Assets and Liabilities, Net		(13,048,504)
100.0%	Net Assets		4,725,408,486

Security	Number of Shares	% of Net Assets	Value ($)
Common Stock 99.3% of net assets
Automobiles & Components 1.2%
Other Securities		1.2	57,799,804
Banks 4.8%
Bank of America Corp.	2,251,894	0.7	32,787,577
Citigroup, Inc.	734,172	0.7	33,977,480
JPMorgan Chase & Co.	933,523	1.2	58,998,654
Wells Fargo & Co.	900,363	1.0	45,000,143
Other Securities		1.2	57,644,146
		4.8	228,408,000
Capital Goods 8.0%
3M Co.	133,861	0.5	22,405,654
General Electric Co.	2,086,598	1.4	64,162,888
United Technologies Corp.	250,392	0.5	26,133,413
Other Securities		5.6	263,505,737
		8.0	376,207,692
Commercial & Professional Supplies 0.7%
Other Securities		0.7	35,273,875
Consumer Durables & Apparel 1.1%
Other Securities		1.1	51,781,310

Security	Number of Shares	% of Net Assets	Value ($)
Consumer Services 1.7%
McDonald's Corp.	277,588	0.7	35,112,106
Other Securities		1.0	45,562,253
		1.7	80,674,359
Diversified Financials 3.5%
Berkshire Hathaway, Inc., Class B *	302,926	0.9	44,069,675
The Charles Schwab Corp. (b)	72,715	0.1	2,065,833
The Goldman Sachs Group, Inc.	152,109	0.5	24,962,608
Other Securities		2.0	92,749,053
		3.5	163,847,169
Energy 14.9%
Chevron Corp.	1,339,912	2.9	136,912,208
ConocoPhillips	1,004,782	1.0	48,018,532
Exxon Mobil Corp.	2,570,281	4.8	227,212,840
Occidental Petroleum Corp.	297,300	0.5	22,788,045
Phillips 66	375,608	0.7	30,841,173
Schlumberger Ltd.	345,310	0.6	27,742,205
Valero Energy Corp.	350,166	0.4	20,614,272
Other Securities		4.0	189,345,587
		14.9	703,474,862
Food & Staples Retailing 4.0%
Costco Wholesale Corp.	146,963	0.5	21,769,629
CVS Health Corp.	435,716	0.9	43,789,458
Wal-Mart Stores, Inc.	1,077,872	1.5	72,077,301
Other Securities		1.1	49,418,902
		4.0	187,055,290
Food, Beverage & Tobacco 5.5%
Altria Group, Inc.	338,716	0.5	21,240,880
PepsiCo, Inc.	340,263	0.7	35,033,479
Philip Morris International, Inc.	470,588	1.0	46,174,095
The Coca-Cola Co.	834,743	0.8	37,396,486
Other Securities		2.5	117,976,647
		5.5	257,821,587
Health Care Equipment & Services 5.3%
Anthem, Inc.	175,250	0.5	24,669,942
UnitedHealth Group, Inc.	292,296	0.8	38,489,537
Other Securities		4.0	186,975,724
		5.3	250,135,203
Household & Personal Products 2.2%
The Procter & Gamble Co.	841,735	1.4	67,439,808
Other Securities		0.8	35,836,127
		2.2	103,275,935
Insurance 3.4%
American International Group, Inc.	434,142	0.5	24,233,806
The Travelers Cos., Inc.	209,372	0.5	23,009,983
Other Securities		2.4	115,178,897
		3.4	162,422,686

18 See financial notes

Schwab Fundamental US Large Company Index Fund

Condensed Portfolio Holdings (Unaudited) continued

Security	Number of Shares	% of Net Assets	Value ($)
Materials 4.1%
Other Securities		4.1	191,562,345
Media 3.5%
Comcast Corp., Class A	444,057	0.6	26,980,903
The Walt Disney Co.	260,662	0.6	26,915,958
Time Warner Cable, Inc.	113,701	0.5	24,117,119
Time Warner, Inc.	379,433	0.6	28,510,596
Other Securities		1.2	59,628,372
		3.5	166,152,948
Pharmaceuticals, Biotechnology & Life Sciences 5.2%
Amgen, Inc.	145,923	0.5	23,099,611
Johnson & Johnson	540,707	1.3	60,602,441
Merck & Co., Inc.	641,462	0.7	35,177,776
Pfizer, Inc.	1,572,804	1.1	51,446,419
Other Securities		1.6	76,879,502
		5.2	247,205,749
Real Estate 1.3%
Other Securities		1.3	59,171,793
Retailing 4.9%
Lowe's Cos., Inc.	330,645	0.5	25,135,633
Target Corp.	308,783	0.5	24,548,248
The Home Depot, Inc.	295,543	0.9	39,570,252
Other Securities		3.0	141,907,226
		4.9	231,161,359
Semiconductors & Semiconductor Equipment 2.4%
Intel Corp.	1,722,176	1.1	52,147,489
Other Securities		1.3	61,003,024
		2.4	113,150,513
Software & Services 6.9%
International Business Machines Corp.	459,701	1.4	67,088,764
Microsoft Corp.	1,671,828	1.8	83,374,062
Oracle Corp.	752,844	0.6	30,008,362
Other Securities		3.1	146,673,853
		6.9	327,145,041
Technology Hardware & Equipment 4.2%
Apple, Inc.	716,657	1.4	67,179,427
Cisco Systems, Inc.	1,249,651	0.7	34,352,906
HP, Inc.	2,258,191	0.6	27,708,004
Other Securities		1.5	70,476,217
		4.2	199,716,554
Telecommunication Services 4.2%
AT&T, Inc.	3,030,054	2.5	117,626,696
Verizon Communications, Inc.	1,220,549	1.3	62,174,766
Other Securities		0.4	19,659,887
		4.2	199,461,349

Security	Number of Shares	% of Net Assets	Value ($)
Transportation 1.8%
Other Securities		1.8	84,513,397
Utilities 4.5%
Other Securities		4.5	214,158,249
Total Common Stock
(Cost $3,806,801,193)			4,691,577,069

Other Investment Companies 1.0% of net assets
Money Market Fund 0.6%
State Street Institutional U.S. Government Money Market Fund, Premier Class 0.23% (c)	26,650,566	0.6	26,650,566
Securities Lending Collateral 0.4%
Other Securities		0.4	20,229,355
Total Other Investment Companies
(Cost $46,879,921)			46,879,921

End of Investments.

At 04/30/16, the tax basis cost of the fund's investments was $3,865,019,998 and the unrealized appreciation and depreciation were $1,033,124,152 and ($159,687,160), respectively, with a net unrealized appreciation of $873,436,992.

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 $19,752,673.
(b)	Issuer is affiliated with the fund's investment adviser.
(c)	The rate shown is the 7-day yield.

In addition to the above, the fund held the following at 04/30/16:

	Number of Contracts	Contract Value ($)	Unrealized Appreciation ($)
Futures Contracts
S&P 500 Index, e-mini, Long, expires 06/17/16	340	35,004,700	1,188,632

See financial notes 19

Schwab Fundamental US Large Company Index Fund

Statement of

Assets and Liabilities

As of April 30, 2016; unaudited

Assets
Investment in affiliated issuer, at value (cost $1,270,946)		$2,065,833
Investments in unaffiliated issuers, at value (cost $3,832,180,813) including securities on loan of $19,752,673		4,716,161,802
Collateral invested for securities on loan, at value (cost $20,229,355)	+	20,229,355
Total investments, at value (cost $3,853,681,114)		4,738,456,990
Cash		324,639
Deposit with broker for futures contracts		1,852,500
Receivables:
Investments sold		108,908
Dividends		5,721,510
Fund shares sold		4,272,761
Income from securities on loan		74,939
Prepaid expenses	+	46,022
Total assets		4,750,858,269
Liabilities
Collateral held for securities on loan		20,229,355
Payables:
Investments bought		433,547
Investment adviser and administrator fees		159,867
Shareholder service fees		176,279
Fund shares redeemed		3,264,831
Variation margin on futures contracts		226,100
Accrued expenses	+	959,804
Total liabilities		25,449,783
Net Assets
Total assets		4,750,858,269
Total liabilities	–	25,449,783
Net assets		$4,725,408,486
Net Assets by Source
Capital received from investors		3,700,752,186
Net investment income not yet distributed		35,376,403
Net realized capital gains		103,315,389
Net unrealized capital appreciation		885,964,508

Net Asset Value (NAV)
Net Assets	÷	Shares Outstanding	=	NAV
$4,725,408,486		321,102,027		$14.72

See financial notes 21

Schwab Fundamental US Large Company Index Fund

Statement of

Operations

For the period November 1, 2015 through April 30, 2016; unaudited

Investment Income
Dividends received from affiliated issuer		$9,236
Dividends received from unaffiliated issuers (net of foreign withholding taxes of $12,667)		63,979,002
Securities on loan	+	774,119
Total investment income		64,762,357
Expenses
Investment adviser and administrator fees		5,234,772
Shareholder service fees		1,673,144
Index fees		1,402,001
Transfer agent fees		325,021
Proxy fees		96,812
Shareholder reports		88,841
Portfolio accounting fees		63,038
Custodian fees		44,159
Professional fees		30,912
Registration fees		23,610
Independent trustees' fees		17,061
Interest expense		2,880
Other expenses	+	52,743
Total expenses		9,054,994
Expense reduction by CSIM and its affiliates	–	943,699
Net expenses	–	8,111,295
Net investment income		56,651,062
Realized and Unrealized Gains (Losses)
Net realized gains on affiliated issuer		84,291
Net realized gains on unaffiliated issuers		118,388,419
Net realized gains on futures contracts	+	235,090
Net realized gains		118,707,800
Net change in unrealized appreciation (depreciation) on affiliated issuer		(282,544)
Net change in unrealized appreciation (depreciation) on unaffiliated issuers		(59,697,777)
Net change in unrealized appreciation (depreciation) on futures contracts	+	926,522
Net change in unrealized appreciation (depreciation)	+	(59,053,799)
Net realized and unrealized gains		59,654,001
Increase in net assets resulting from operations		$116,305,063

22 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
	11/1/15-4/30/16		11/1/14-10/31/15
Net investment income		$56,651,062	$105,432,655
Net realized gains		118,707,800	147,141,065
Net change in unrealized appreciation (depreciation)	+	(59,053,799)	(189,185,954)
Increase in net assets from operations		116,305,063	63,387,766
Distributions to Shareholders
Distributions from net investment income		(108,957,758)	(76,925,735)
Distributions from net realized gains	+	(146,034,638)	(114,155,826)
Total distributions		($254,992,396)	($191,081,561)

Transactions in Fund Shares
		11/1/15-4/30/16		11/1/14-10/31/15
		SHARES	VALUE	SHARES	VALUE
Shares sold		32,728,553	$460,280,162	98,386,452	$1,496,556,101
Shares reinvested		11,581,875	160,408,965	7,976,908	122,684,844
Shares redeemed	+	(45,849,087)	(642,257,459)	(70,618,440)	(1,070,631,347)
Net transactions in fund shares		(1,538,659)	($21,568,332)	35,744,920	$548,609,598
Shares Outstanding and Net Assets
		11/1/15-4/30/16		11/1/14-10/31/15
		SHARES	NET ASSETS	SHARES	NET ASSETS
Beginning of period		322,640,686	$4,885,664,151	286,895,766	$4,464,748,348
Total increase or decrease	+	(1,538,659)	(160,255,665)	35,744,920	420,915,803
End of period		321,102,027	$4,725,408,486	322,640,686	$4,885,664,151
Net investment income not yet distributed			$35,376,403		$87,683,099

See financial notes 23

Schwab Fundamental US Small Company Index Fund

Financial Statements

Financial Highlights

	11/1/15– 4/30/16*	11/1/14– 10/31/15	11/1/13– 10/31/14	11/1/12– 10/31/13	11/1/11– 10/31/12	11/1/10– 10/31/11
Per-Share Data
Net asset value at beginning of period	$12.82	$13.51	$12.78	$10.31	$10.11	$10.10
Income (loss) from investment operations:
Net investment income (loss)	0.10 ¹	0.18 ¹	0.14	0.16	0.15	0.11
Net realized and unrealized gains (losses)	0.02	(0.03)	1.23	3.35	0.88	0.47
Total from investment operations	0.12	0.15	1.37	3.51	1.03	0.58
Less distributions:
Distributions from net investment income	(0.18)	(0.16)	(0.12)	(0.20)	(0.12)	(0.10)
Distributions from net realized gains	(0.56)	(0.68)	(0.52)	(0.84)	(0.71)	(0.47)
Total distributions	(0.74)	(0.84)	(0.64)	(1.04)	(0.83)	(0.57)
Net asset value at end of period	$12.20	$12.82	$13.51	$12.78	$10.31	$10.11
Total return	1.30% ²	1.01%	10.99%	37.55%	11.37%	5.55%
Ratios/Supplemental Data
Ratios to average net assets:
Net operating expenses	0.35% ³	0.35%	0.35%	0.35%	0.32% ⁴	0.35%
Gross operating expenses	0.43% ³	0.43%	0.44%	0.48%	0.50%	0.50%
Net investment income (loss)	1.80% ³	1.37%	1.14%	1.41%	1.46%	1.18%
Portfolio turnover rate	11% ²	31%	29%	27%	92% ⁵	35%
Net assets, end of period (x 1,000,000)	$1,418	$1,416	$1,208	$849	$619	$563

*	Unaudited.

Calculated based on the average shares outstanding during the period.

Not annualized.

Annualized (except for proxy costs).

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.

24 See financial notes

Schwab Fundamental US Small Company Index Fund

Condensed Portfolio Holdings as of April 30, 2016 (Unaudited)

Holdings by Category		Cost ($)	Value ($)
98.9%	Common Stock	1,213,454,991	1,403,055,526
0.0%	Rights	266,856	199,773
3.6%	Other Investment Companies	50,210,252	50,210,252
102.5%	Total Investments	1,263,932,099	1,453,465,551
(2.5%)	Other Assets and Liabilities, Net		(35,006,597)
100.0%	Net Assets		1,418,458,954

Security	Number of Shares	% of Net Assets	Value ($)
Common Stock 98.9% of net assets
Automobiles & Components 1.2%
Thor Industries, Inc.	53,100	0.2	3,399,462
Other Securities		1.0	13,977,217
		1.2	17,376,679
Banks 4.9%
Other Securities		4.9	69,385,027
Capital Goods 12.6%
BWX Technologies, Inc.	105,900	0.2	3,536,001
General Cable Corp.	230,100	0.3	3,598,764
Huntington Ingalls Industries, Inc.	25,300	0.3	3,662,681
MSC Industrial Direct Co., Inc., Class A	44,100	0.2	3,417,750
Terex Corp.	136,700	0.2	3,265,763
Valmont Industries, Inc.	27,750	0.3	3,895,545
Other Securities		11.1	157,657,157
		12.6	179,033,661
Commercial & Professional Supplies 4.9%
ABM Industries, Inc.	104,000	0.2	3,345,680
Copart, Inc. *	89,500	0.3	3,834,180
Waste Connections, Inc.	48,500	0.2	3,263,080
Other Securities		4.2	59,414,046
		4.9	69,856,986

Security	Number of Shares	% of Net Assets	Value ($)
Consumer Durables & Apparel 3.3%
Carter's, Inc.	31,000	0.2	3,306,770
D.R. Horton, Inc.	112,900	0.2	3,393,774
Michael Kors Holdings Ltd. *	68,500	0.3	3,538,710
Other Securities		2.6	36,246,223
		3.3	46,485,477
Consumer Services 4.4%
Panera Bread Co., Class A *	16,975	0.3	3,640,968
Service Corp. International	124,300	0.2	3,315,081
Weight Watchers International, Inc. *(a)	259,592	0.2	3,361,716
Other Securities		3.7	52,445,611
		4.4	62,763,376
Diversified Financials 3.6%
Other Securities		3.6	51,526,670
Energy 5.5%
Concho Resources, Inc. *	29,200	0.2	3,392,164
Range Resources Corp.	80,600	0.3	3,555,266
SM Energy Co.	111,800	0.2	3,483,688
WPX Energy, Inc. *	437,500	0.3	4,226,250
Other Securities		4.5	63,976,348
		5.5	78,633,716
Food & Staples Retailing 0.8%
Other Securities		0.8	11,298,437
Food, Beverage & Tobacco 2.4%
Other Securities		2.4	33,677,473
Health Care Equipment & Services 4.5%
Edwards Lifesciences Corp. *	37,100	0.3	3,940,391
IDEXX Laboratories, Inc. *	43,700	0.3	3,686,095
Other Securities		3.9	55,541,308
		4.5	63,167,794
Household & Personal Products 0.5%
Nu Skin Enterprises, Inc., Class A (a)	83,920	0.3	3,421,418
Other Securities		0.2	2,889,306
		0.5	6,310,724
Insurance 3.6%
Aspen Insurance Holdings Ltd.	71,000	0.2	3,290,850
CNO Financial Group, Inc.	181,300	0.2	3,330,481
Endurance Specialty Holdings Ltd.	54,396	0.3	3,480,256
Primerica, Inc.	71,500	0.3	3,543,540
Other Securities		2.6	37,074,570
		3.6	50,719,697
Materials 6.3%
Cabot Corp.	80,200	0.3	3,912,958
Crown Holdings, Inc. *	67,200	0.3	3,558,912

See financial notes 25

Schwab Fundamental US Small Company Index Fund

Condensed Portfolio Holdings (Unaudited) continued

Security	Number of Shares	% of Net Assets	Value ($)
Martin Marietta Materials, Inc.	19,300	0.2	3,266,139
Other Securities		5.5	78,620,358
		6.3	89,358,367
Media 1.9%
Sirius XM Holdings, Inc. *	855,300	0.2	3,378,435
Other Securities		1.7	23,751,239
		1.9	27,129,674
Pharmaceuticals, Biotechnology & Life Sciences 2.0%
Other Securities		2.0	28,637,933
Real Estate 10.3%
Equinix, Inc.	11,186	0.3	3,695,295
Liberty Property Trust	97,300	0.2	3,395,770
Rayonier, Inc.	137,700	0.2	3,398,436
Other Securities		9.6	136,008,716
		10.3	146,498,217
Retailing 5.1%
Other Securities		5.1	72,802,063
Semiconductors & Semiconductor Equipment 2.4%
Advanced Micro Devices, Inc. *	1,129,500	0.3	4,009,725
Other Securities		2.1	29,884,983
		2.4	33,894,708
Software & Services 5.0%
Convergys Corp.	125,600	0.2	3,328,400
Science Applications International Corp.	66,300	0.3	3,519,867
VeriSign, Inc. *	40,700	0.3	3,516,480
Other Securities		4.2	60,247,717
		5.0	70,612,464
Technology Hardware & Equipment 5.3%
NCR Corp. *	115,800	0.2	3,368,622
Sanmina Corp. *	155,400	0.3	3,675,210
Other Securities		4.8	67,546,699
		5.3	74,590,531
Telecommunication Services 1.2%
Level 3 Communications, Inc. *	63,630	0.3	3,325,304
T-Mobile US, Inc. *	83,300	0.2	3,272,024
Other Securities		0.7	10,350,266
		1.2	16,947,594
Transportation 3.0%
SkyWest, Inc.	166,100	0.3	3,903,350
Southwest Airlines Co.	75,400	0.2	3,363,594
Other Securities		2.5	35,731,655
		3.0	42,998,599
Utilities 4.2%
Hawaiian Electric Industries, Inc.	107,800	0.3	3,523,982
PNM Resources, Inc.	105,500	0.2	3,342,240
Portland General Electric Co.	84,900	0.2	3,372,228

Security	Number of Shares	% of Net Assets	Value ($)
Questar Corp.	135,000	0.3	3,384,450
Other Securities		3.2	45,726,759
		4.2	59,349,659
Total Common Stock
(Cost $1,213,454,991)			1,403,055,526

Rights 0.0% of net assets
Technology Hardware & Equipment 0.0%
Other Securities		0.0	—
Telecommunication Services 0.0%
Other Securities		0.0	199,773
Total Rights
(Cost $266,856)			199,773

Other Investment Companies 3.6% of net assets
Money Market Fund 0.9%
State Street Institutional U.S. Government Money Market Fund, Premier Class 0.23% (d)	12,043,857	0.9	12,043,857
Securities Lending Collateral 2.7%
Wells Fargo Advantage Government Money Market Fund, Select Class 0.23% (d)	38,166,395	2.7	38,166,395
Total Other Investment Companies
(Cost $50,210,252)			50,210,252

End of Investments.

At 04/30/16, the tax basis cost of the fund's investments was $1,270,658,339 and the unrealized appreciation and depreciation were $286,491,652 and ($103,684,440), respectively, with a net unrealized appreciation of $182,807,212.

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 $34,689,707.
(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 $199,773 or 0.0% of net assets.
(d)	The rate shown is the 7-day yield.

CVR —	Contingent Value Rights
REIT —	Real Estate Investment Trust

26 See financial notes

Schwab Fundamental US Small Company Index Fund

Condensed Portfolio Holdings (Unaudited) continued

In addition to the above, the fund held the following at 04/30/16:

	Number of Contracts	Contract Value ($)	Unrealized Appreciation ($)
Futures Contracts
Russell 2000 Index, mini, Long, expires 06/17/16	135	15,222,600	193,102

The following is a summary of the inputs used to value the fund's investments as of April 30, 2016 (see financial note 2(a) for additional information):

Description	Quoted Prices in Active Markets for Identical Assets (Level 1)	Other Significant Observable Inputs (Level 2)	Significant Unobservable Inputs (Level 3)	Total
Common Stock¹	$1,403,055,526	$—	$—	$1,403,055,526
Rights ¹	—	—	199,773	199,773
Other Investment Companies	50,210,252	—	—	50,210,252
Total	$1,453,265,778	$—	$199,773	$1,453,465,551
Other Financial Instruments
Futures Contracts²	$193,102	$—	$—	$193,102

¹	As categorized in the complete schedule of Portfolio Holdings.
²	Futures contracts are not included in Investments in the schedule of Condensed 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:

Investments in Securities	Balance as of October 31, 2015	Realized Gains (Losses)	Change in Unrealized Appreciation (Depreciation)	Gross Purchases	Gross Sales	Gross Transfers in	Gross Transfers out	Balance as of April 30, 2016
Rights	$266,364	$—	($66,591)	$—	$—	$—	$—	$199,773
Total	$266,364	$—	($66,591)	$—	$—	$—	$—	$199,773

See financial notes 27

Schwab Fundamental International Large Company Index Fund

Financial Statements

Financial Highlights

	11/1/15– 4/30/16*	11/1/14– 10/31/15	11/1/13– 10/31/14	11/1/12– 10/31/13	11/1/11– 10/31/12	11/1/10– 10/31/11
Per-Share Data
Net asset value at beginning of period	$8.19	$8.84	$9.05	$7.16	$7.26	$8.09
Income (loss) from investment operations:
Net investment income (loss)	0.11 ¹	0.25 ¹	0.30	0.23	0.22	0.23
Net realized and unrealized gains (losses)	(0.28)	(0.60)	(0.26)	1.87	(0.08) ²	(0.85)
Total from investment operations	(0.17)	(0.35)	0.04	2.10	0.14	(0.62)
Less distributions:
Distributions from net investment income	(0.22)	(0.30)	(0.25)	(0.21)	(0.24)	(0.21)
Net asset value at end of period	$7.80	$8.19	$8.84	$9.05	$7.16	$7.26
Total return	(1.94%) ³	(4.07%)	0.39%	30.12%	2.24%	(7.88%)
Ratios/Supplemental Data
Ratios to average net assets:
Net operating expenses	0.35% ⁴	0.35%	0.35%	0.34% ⁵	0.31% ⁵	0.35%
Gross operating expenses	0.46% ⁴	0.46%	0.48%	0.52%	0.56%	0.57%
Net investment income (loss)	2.86% ⁴	2.96%	3.52%	2.95%	3.58%	3.24%
Portfolio turnover rate	6% ³	11%	8%	22%	61% ⁶	35%
Net assets, end of period (x 1,000,000)	$952	$1,173	$908	$646	$501	$372

*	Unaudited.

Calculated based on the average shares outstanding during the period.

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.

Not annualized.

⁴

Annualized (except for proxy costs).

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.

See financial notes 31

Schwab Fundamental International Large Company Index Fund

Condensed Portfolio Holdings as of April 30, 2016 (Unaudited)

Holdings by Category		Cost ($)	Value ($)
98.4%	Common Stock	1,014,593,018	936,016,948
0.6%	Preferred Stock	6,841,268	5,687,172
2.2%	Other Investment Company	21,066,109	21,066,109
0.4%	Short-Term Investments	4,168,240	4,168,240
101.6%	Total Investments	1,046,668,635	966,938,469
(1.6%)	Other Assets and Liabilities, Net		(15,160,579)
100.0%	Net Assets		951,777,890

Security	Number of Shares	% of Net Assets	Value ($)
Common Stock 98.4% of net assets
Australia 6.0%
BHP Billiton Ltd.	424,737	0.7	6,633,092
Commonwealth Bank of Australia	87,834	0.5	4,903,510
National Australia Bank Ltd.	181,866	0.4	3,731,168
Wesfarmers Ltd.	142,125	0.5	4,602,105
Westpac Banking Corp.	206,434	0.5	4,845,736
Other Securities		3.4	32,674,415
		6.0	57,390,026
Austria 0.3%
Other Securities		0.3	3,292,495
Belgium 1.0%
Other Securities		1.0	9,019,407
Canada 7.7%
Royal Bank of Canada	73,844	0.5	4,585,897
Suncor Energy, Inc.	191,237	0.6	5,613,500
The Bank of Nova Scotia	68,515	0.4	3,593,120
The Toronto-Dominion Bank	81,952	0.4	3,647,899
Other Securities		5.8	55,424,314
		7.7	72,864,730

Security	Number of Shares	% of Net Assets	Value ($)
Denmark 0.8%
Other Securities		0.8	7,424,143
Finland 0.9%
Other Securities		0.9	8,965,787
France 10.5%
BNP Paribas S.A.	100,509	0.6	5,322,850
Engie S.A.	356,238	0.6	5,875,591
Orange S.A.	360,470	0.6	5,988,820
Sanofi	78,497	0.7	6,470,239
TOTAL S.A.	392,504	2.1	19,837,465
Other Securities		5.9	56,093,239
		10.5	99,588,204
Germany 8.6%
Allianz SE - Reg'd	31,348	0.6	5,333,168
BASF SE	95,502	0.8	7,900,957
Bayer AG - Reg'd	39,891	0.5	4,610,078
Daimler AG - Reg'd	80,249	0.6	5,591,481
Deutsche Telekom AG - Reg'd	347,050	0.6	6,091,917
E.ON SE	670,120	0.7	6,945,238
Siemens AG - Reg'd	61,842	0.7	6,471,656
Other Securities		4.1	38,925,248
		8.6	81,869,743
Hong Kong 1.1%
Other Securities		1.1	10,174,645
Ireland 0.5%
Other Securities		0.5	4,882,641
Israel 0.4%
Other Securities		0.4	4,000,454
Italy 3.3%
Enel S.p.A.	1,319,769	0.6	5,998,121
Eni S.p.A.	576,815	1.0	9,423,388
Other Securities		1.7	15,849,723
		3.3	31,271,232
Japan 20.3%
Honda Motor Co., Ltd.	172,400	0.5	4,652,346
KDDI Corp.	130,200	0.4	3,750,507
Nippon Telegraph & Telephone Corp.	111,408	0.5	4,985,542
Toyota Motor Corp.	154,400	0.8	7,826,490
Other Securities		18.1	172,073,644
		20.3	193,288,529
Luxembourg 0.4%
Other Securities		0.4	4,176,072

32 See financial notes

Schwab Fundamental International Large Company Index Fund

Condensed Portfolio Holdings (Unaudited) continued

Security	Number of Shares	% of Net Assets	Value ($)
Netherlands 6.0%
Royal Dutch Shell plc, A Shares	782,553	2.2	20,673,392
Royal Dutch Shell plc, B Shares	586,779	1.6	15,405,807
Other Securities		2.2	20,952,656
		6.0	57,031,855
New Zealand 0.2%
Other Securities		0.2	1,505,206
Norway 1.0%
Statoil A.S.A.	276,520	0.5	4,867,110
Other Securities		0.5	4,570,115
		1.0	9,437,225
Portugal 0.3%
Other Securities		0.3	2,771,172
Singapore 0.9%
Other Securities		0.9	8,382,403
Spain 4.2%
Banco Bilbao Vizcaya Argentaria S.A.	532,251	0.4	3,657,526
Banco Santander S.A.	2,280,375	1.2	11,580,472
Iberdrola S.A.	517,109	0.4	3,681,164
Repsol S.A.	285,645	0.4	3,763,790
Telefonica S.A.	761,704	0.9	8,332,427
Other Securities		0.9	8,882,916
		4.2	39,898,295
Sweden 2.2%
Other Securities		2.2	20,874,115
Switzerland 5.9%
Glencore plc *	2,404,558	0.6	5,746,697
Nestle S.A. - Reg'd	142,074	1.1	10,604,354
Novartis AG - Reg'd	96,973	0.8	7,379,860
Roche Holding AG	25,135	0.6	6,359,386
Other Securities		2.8	26,391,950
		5.9	56,482,247
United Kingdom 15.9%
Anglo American plc	362,386	0.4	4,053,384
AstraZeneca plc	97,870	0.6	5,615,056
BHP Billiton plc	285,592	0.4	3,902,471
BP plc	3,879,353	2.2	21,372,832
British American Tobacco plc	97,673	0.6	5,955,328
GlaxoSmithKline plc	336,235	0.8	7,186,172
HSBC Holdings plc	1,442,970	1.0	9,562,381
Rio Tinto plc	134,520	0.5	4,512,650
Tesco plc *	1,826,278	0.5	4,591,334
Vodafone Group plc	2,742,152	0.9	8,834,769
Other Securities		8.0	75,839,945
		15.9	151,426,322
Total Common Stock
(Cost $1,014,593,018)			936,016,948

Security	Number of Shares	% of Net Assets	Value ($)
Preferred Stock 0.6% of net assets
Germany 0.5%
Other Securities		0.5	4,575,909
Italy 0.1%
Other Securities		0.1	1,111,263
Total Preferred Stock
(Cost $6,841,268)			5,687,172

Other Investment Company 2.2% of net assets
United States 2.2%
Securities Lending Collateral 2.2%
Wells Fargo Advantage Government Money Market Fund, Select Class 0.23% (d)	21,066,109	2.2	21,066,109
Total Other Investment Company
(Cost $21,066,109)			21,066,109
Security Rate, Maturity Date	Face Amount ($)	% of Net Assets	Value ($)
Short-Term Investments 0.4% of net assets
Time Deposit 0.4%
Other Securities		0.4	4,168,240
Total Short-Term Investments
(Cost $4,168,240)			4,168,240

End of Investments.

At 04/30/16, the tax basis cost of the fund's investments was $1,063,200,403 unrealized appreciation and depreciation were $50,601,506 and ($146,863,440), respectively, with a net unrealized depreciation of ($96,261,934).

At 04/30/16, the values of certain foreign securities held by the fund aggregating $858,628,894 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 $89,996 or 0.0% of net assets.
(c)	All or a portion of this security is on loan. Securities on loan were valued at $19,769,672.
(d)	The rate shown is the 7-day yield.
(e)	The rate shown is the current daily overnight rate.

See financial notes 33

Schwab Fundamental International Large Company Index Fund

Condensed Portfolio Holdings (Unaudited) continued

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

In addition to the above, the fund held the following at 04/30/16:

	Number of Contracts	Contract Value ($)	Unrealized Appreciation ($)
Futures Contracts
MSCI EAFE, e-mini, Long, expires 06/17/16	50	4,154,750	149,391

The following is a summary of the inputs used to value the fund's investments as of April 30, 2016 (see financial note 2(a) for additional information):

Description	Quoted Prices in Active Markets for Identical Assets (Level 1)	Other Significant Observable Inputs (Level 2)	Significant Unobservable Inputs (Level 3)	Total
Common Stock¹	$—	$209,805,422	$—	$209,805,422
Australia	—	57,348,439	41,587	57,390,026
Canada	72,831,325	—	33,405	72,864,730
France	167,347	99,420,857	—	99,588,204
Ireland	718,541	4,164,100	—	4,882,641
Israel	229,798	3,770,656	—	4,000,454
Japan	250,421	193,038,108	—	193,288,529
Netherlands	3,873,462	53,158,393	—	57,031,855
Singapore	682,174	7,700,229	—	8,382,403
Sweden	662,195	20,211,920	—	20,874,115
Switzerland	1,933,915	54,548,332	—	56,482,247
United Kingdom	1,636,052	149,775,266	15,004	151,426,322
Preferred Stock¹	—	5,687,172	—	5,687,172
Other Investment Company¹	21,066,109	—	—	21,066,109
Short-Term Investments¹	—	4,168,240	—	4,168,240
Total	$104,051,339	$862,797,134	$89,996	$966,938,469
Other Financial Instruments
Futures Contracts²	$149,391	$—	$—	$149,391

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

34 See financial notes

Schwab Fundamental International Large Company Index Fund

Condensed Portfolio Holdings (Unaudited) continued

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

Investments in Securities	Balance as of October 31, 2015	Realized Gains (Losses)	Change in Unrealized Appreciation (Depreciation)	Gross Purchases	Gross Sales	Gross Transfers in	Gross Transfers out	Balance as of April 30, 2016
Common Stock
Australia	$—	$1,889	($446,979)	$181,160	($41,780)	$347,297	$—	$41,587
Canada	—	—	(260,240)	66,232	—	227,413	—	33,405
United Kingdom	—	—	81	14,923	—	—	—	15,004
Preferred Stock
United Kingdom	21,162	(462)	3	—	(20,703)	—	—	—
Total	$21,162	$1,427	($707,135)	$262,315	($62,483)	$574,710	$—	$89,996

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, 2016. The transfers in the amount of $3,965,930 and $325,625 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 into Level 3 from Level 1 or Level 2 were due to the result of fair valued securities for which no quoted value was available.

See financial notes 35

Schwab Fundamental International Large Company Index Fund

Statement of

Operations

For the period November 1, 2015 through April 30, 2016; unaudited

Investment Income
Dividends (net of foreign withholding tax of $1,586,122)		$15,441,019
Interest		1,687
Securities on loan	+	626,609
Total investment income		16,069,315
Expenses
Investment adviser and administrator fees		1,299,724
Shareholder service fees		330,657
Index fees		306,477
Custodian fees		140,452
Transfer agent fees		51,196
Portfolio accounting fees		49,674
Shareholder reports		26,522
Professional fees		24,587
Registration fees		16,592
Proxy fees		15,283
Interest expense		8,954
Independent trustees' fees		6,943
Other expenses	+	16,950
Total expenses		2,294,011
Expense reduction by CSIM and its affiliates	–	518,474
Net expenses	–	1,775,537
Net investment income		14,293,778
Realized and Unrealized Gains (Losses)
Net realized gains on investments		15,835,122
Net realized losses on futures contracts		(23,077)
Net realized gains on foreign currency transactions	+	71,953
Net realized gains		15,883,998
Net change in unrealized appreciation (depreciation) on investments		(72,582,479)
Net change in unrealized appreciation (depreciation) on futures contracts		139,972
Net change in unrealized appreciation (depreciation) on foreign currency translations	+	172,145
Net change in unrealized appreciation (depreciation)	+	(72,270,362)
Net realized and unrealized losses		(56,386,364)
Decrease in net assets resulting from operations		($42,092,586)

See financial notes 37

Schwab Fundamental International Small Company Index Fund

Financial Statements

Financial Highlights

	11/1/15– 4/30/16*	11/1/14– 10/31/15	11/1/13– 10/31/14	11/1/12– 10/31/13	11/1/11– 10/31/12	11/1/10– 10/31/11
Per-Share Data
Net asset value at beginning of period	$11.25	$11.15	$11.47	$9.13	$9.53	$9.96
Income (loss) from investment operations:
Net investment income (loss)¹	0.12	0.22	0.22	0.22	0.21	0.24
Net realized and unrealized gains (losses)	0.22	0.12	(0.23)	2.42	0.03	(0.40)
Total from investment operations	0.34	0.34	(0.01)	2.64	0.24	(0.16)
Less distributions:
Distributions from net investment income	(0.23)	(0.19)	(0.31)	(0.30)	(0.25)	(0.27)
Distributions from net realized gains	—	(0.05)	—	—	(0.39)	—
Total distributions	(0.23)	(0.24)	(0.31)	(0.30)	(0.64)	(0.27)
Net asset value at end of period	$11.36	$11.25	$11.15	$11.47	$9.13	$9.53
Total return	3.12% ²	3.09%	(0.07%)	29.75%	3.13%	(1.76%)
Ratios/Supplemental Data
Ratios to average net assets:
Net operating expenses	0.49% ³	0.49%	0.49%	0.47% ⁴^,⁵	0.46% ⁶^,⁷	0.54%
Gross operating expenses	0.70% ³	0.71%	0.80%	0.93%	0.92% ⁷	0.99%
Net investment income (loss)	2.29% ³	1.98%	1.87%	2.21%	2.42%	2.29%
Portfolio turnover rate	16% ²	37%	41%	29%	89% ⁸	63%
Net assets, end of period (x 1,000,000)	$431	$427	$275	$150	$90	$93

*	Unaudited.

Calculated based on the average shares outstanding during the period.

Not annualized.

Annualized (except for proxy costs).

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 0.52%, if voluntary waiver by CSIM had not been included.

⁶

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

⁷

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

⁸

Portfolio turnover would have been 48%, if rebalancing trades had not been included due to a change in the fund's index.

See financial notes 39

Schwab Fundamental International Small Company Index Fund

Condensed Portfolio Holdings as of April 30, 2016 (Unaudited)

Holdings by Category		Cost ($)	Value ($)
98.2%	Common Stock	391,417,820	423,372,062
0.5%	Preferred Stock	1,857,290	2,007,610
0.0%	Corporate Bond	100,471	92,817
4.4%	Other Investment Companies	18,582,840	18,895,155
0.0%	Short-Term Investments	212,997	212,997
103.1%	Total Investments	412,171,418	444,580,641
(3.1%)	Other Assets and Liabilities, Net		(13,319,936)
100.0%	Net Assets		431,260,705

Security	Number of Shares	% of Net Assets	Value ($)
Common Stock 98.2% of net assets
Australia 6.4%
Dexus Property Group	120,150	0.2	766,097
Goodman Group	138,053	0.2	719,237
OZ Minerals Ltd.	198,965	0.2	883,329
Sigma Pharmaceuticals Ltd.	981,986	0.2	817,089
The GPT Group	176,046	0.1	670,471
Treasury Wine Estates Ltd.	113,743	0.2	800,893
Vicinity Centres	301,686	0.2	758,314
Other Securities		5.1	22,155,494
		6.4	27,570,924
Austria 0.8%
Other Securities		0.8	3,480,835
Belgium 0.9%
Bekaert N.V.	17,094	0.2	752,806
Other Securities		0.7	3,315,649
		0.9	4,068,455
Canada 9.2%
Agnico-Eagle Mines Ltd.	20,296	0.2	959,397
IAMGOLD Corp. *	313,968	0.2	1,068,497
Keyera Corp.	21,574	0.2	694,832
Pan American Silver Corp.	47,230	0.2	740,427

Security	Number of Shares	% of Net Assets	Value ($)
Precision Drilling Corp.	132,400	0.2	686,956
Progressive Waste Solutions Ltd.	20,985	0.1	675,360
Trican Well Service Ltd. *	484,148	0.2	675,268
Other Securities		7.9	34,066,155
		9.2	39,566,892
Denmark 1.5%
Pandora A/S	5,367	0.2	697,777
Other Securities		1.3	5,656,565
		1.5	6,354,342
Finland 1.7%
Other Securities		1.7	7,266,063
France 4.4%
Fonciere Des Regions	7,360	0.2	696,299
Imerys S.A.	9,099	0.1	671,945
UBISOFT Entertainment *	25,751	0.2	747,424
Other Securities		3.9	16,842,654
		4.4	18,958,322
Germany 3.3%
Other Securities		3.3	14,086,430
Greece 0.0%
Other Securities		0.0	—
Hong Kong 2.5%
PCCW Ltd.	985,000	0.2	666,730
Other Securities		2.3	10,029,746
		2.5	10,696,476
Ireland 0.7%
Other Securities		0.7	3,246,489
Israel 0.9%
Other Securities		0.9	4,142,001
Italy 2.5%
Italcementi S.p.A.	71,002	0.2	842,277
Other Securities		2.3	9,792,340
		2.5	10,634,617
Japan 37.7%
COMSYS Holdings Corp.	45,000	0.1	676,601
Fuji Electric Co., Ltd.	162,000	0.1	689,349
Hitachi High-Technologies Corp.	24,900	0.1	673,735
IT Holdings Corp.	29,800	0.2	704,224
Japan Real Estate Investment Corp.	112	0.2	697,425
Kikkoman Corp.	24,000	0.2	764,727
Koito Manufacturing Co., Ltd.	16,700	0.2	723,515
Kurita Water Industries Ltd.	29,300	0.2	704,546
Matsumotokiyoshi Holdings Co., Ltd.	14,300	0.2	699,940
Mitsubishi Gas Chemical Co., Inc.	130,000	0.2	712,896
Morinaga Milk Industry Co., Ltd.	147,000	0.2	770,809
Nichirei Corp.	102,000	0.2	887,829
Nippon Building Fund, Inc.	136	0.2	861,560
Rengo Co., Ltd.	130,000	0.2	707,900

40 See financial notes

Schwab Fundamental International Small Company Index Fund

Condensed Portfolio Holdings (Unaudited) continued

Security	Number of Shares	% of Net Assets	Value ($)
Sapporo Holdings Ltd.	125,000	0.1	674,964
Taisho Pharmaceutical Holdings Co., Ltd.	9,700	0.2	796,718
Toyota Boshoku Corp.	36,600	0.1	680,897
Tsuruha Holdings, Inc.	7,100	0.1	681,000
Other Securities		34.7	149,519,145
		37.7	162,627,780
Luxembourg 0.6%
Other Securities		0.6	2,658,621
Netherlands 2.1%
Other Securities		2.1	9,051,493
New Zealand 1.1%
Other Securities		1.1	4,723,480
Norway 1.3%
Gjensidige Forsikring A.S.A.	41,987	0.2	718,846
Other Securities		1.1	4,932,003
		1.3	5,650,849
Portugal 0.4%
Other Securities		0.4	1,698,594
Singapore 1.7%
Singapore Technologies Engineering Ltd.	291,800	0.1	696,529
Other Securities		1.6	6,755,752
		1.7	7,452,281
Spain 2.1%
Fomento de Construcciones y Contratas S.A. *	83,925	0.2	730,567
Other Securities		1.9	8,250,741
		2.1	8,981,308
Sweden 2.2%
Hexagon AB, B Shares	16,873	0.1	673,988
Meda AB, A Shares	39,482	0.2	729,628
Other Securities		1.9	8,081,331
		2.2	9,484,947
Switzerland 3.0%
Georg Fischer AG - Reg'd	864	0.2	702,452
Other Securities		2.8	12,204,209
		3.0	12,906,661
United Kingdom 11.1%
Berendsen plc	39,316	0.2	679,289
Evraz plc *	466,046	0.2	967,669
Randgold Resources Ltd.	7,322	0.2	731,382
Other Securities		10.5	45,464,799
		11.1	47,843,139

Security	Number of Shares	% of Net Assets	Value ($)
United States 0.1%
Other Securities		0.1	221,063
Total Common Stock
(Cost $391,417,820)			423,372,062

Preferred Stock 0.5% of net assets
Germany 0.3%
Other Securities		0.3	1,359,287
Italy 0.0%
Other Securities		0.0	167,696
Spain 0.1%
Other Securities		0.1	222,269
Sweden 0.1%
Other Securities		0.1	258,358
Total Preferred Stock
(Cost $1,857,290)			2,007,610
Security Rate, Maturity Date	Face Amount ($)	% of Net Assets	Value ($)
Corporate Bond 0.0% of net assets
Israel 0.0%
Other Securities		0.0	92,817
Total Corporate Bonds
(Cost $100,471)			92,817

Security	Number of Shares	% of Net Assets	Value ($)
Other Investment Companies 4.4% of net assets
United States 4.4%
Equity Fund 0.7%
iShares MSCI EAFE Small Cap ETF	62,500	0.7	3,149,375
Securities Lending Collateral 3.7%
Wells Fargo Advantage Government Money Market Fund, Select Class 0.23% (e)	15,745,780	3.7	15,745,780
		4.4	18,895,155
Total Other Investment Companies
(Cost $18,582,840)			18,895,155

See financial notes 41

Schwab Fundamental International Small Company Index Fund

Condensed Portfolio Holdings (Unaudited) continued

Security Rate, Maturity Date	Face Amount ($)	% of Net Assets	Value ($)
Short-Term Investments 0.0% of net assets
Time Deposit 0.0%
Other Securities		0.0	212,997
Total Short-Term Investments
(Cost $212,997)			212,997

End of Investments.

At 04/30/16, the tax basis cost of the fund's investments was $416,389,408 and the unrealized appreciation and depreciation were $61,041,010 and ($32,849,777), respectively, with a net unrealized appreciation of $28,191,233.

At 04/30/16, the values of certain foreign securities held by the fund aggregating $365,489,007 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 $14,917,493.
(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 $0 or 0.0% of net assets.
(d)	Securities exempt from registration under Rule 144A of the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registrations, normally to qualified institutional buyers. At the period end, the value of these amounted to $1,092,624 or 0.3% of net assets.
(e)	The rate shown is the 7-day yield.
(f)	The rate shown is the current daily overnight rate.

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)

42 See financial notes

Schwab Fundamental International Small Company Index Fund

Condensed Portfolio Holdings (Unaudited) continued

The following is a summary of the inputs used to value the fund's investments as of April 30, 2016 (see financial note 2(a) for additional information):

Description	Quoted Prices in Active Markets for Identical Assets (Level 1)	Other Significant Observable Inputs (Level 2)	Significant Unobservable Inputs (Level 3)	Total
Common Stock¹	$—	$29,506,386	$—	$29,506,386
Australia	273,659	27,297,265	—	27,570,924
Austria	194,954	3,285,881	—	3,480,835
Belgium	629,436	3,439,019	—	4,068,455
Canada	39,566,892	—	—	39,566,892
Denmark	393,899	5,960,443	—	6,354,342
Finland	585,974	6,680,089	—	7,266,063
France	1,060,019	17,898,303	—	18,958,322
Greece	—	—	—	—
Ireland	1,471,239	1,775,250	—	3,246,489
Israel	513,762	3,628,239	—	4,142,001
Italy	1,669,372	8,965,245	—	10,634,617
Japan	593,064	162,034,716	—	162,627,780
Luxembourg	643,099	2,015,522	—	2,658,621
Netherlands	1,399,754	7,651,739	—	9,051,493
Norway	147,244	5,503,605	—	5,650,849
Portugal	135,982	1,562,612	—	1,698,594
Singapore	320,241	7,132,040	—	7,452,281
Spain	473,279	8,508,029	—	8,981,308
Sweden	122,023	9,362,924	—	9,484,947
Switzerland	970,232	11,936,429	—	12,906,661
United Kingdom	8,339,937	39,503,202	—	47,843,139
United States	221,063	—	—	221,063
Preferred Stock¹	—	1,749,252	—	1,749,252
Sweden	258,358	—	—	258,358
Corporate Bond¹	—	92,817	—	92,817
Other Investment Companies
United States¹	18,895,155	—	—	18,895,155
Short-Term Investments¹	—	212,997	—	212,997
Total	$78,878,637	$365,702,004	$—	$444,580,641

¹	As categorized in the complete schedule of Portfolio Holdings.

See financial notes 43

Schwab Fundamental International Small Company Index Fund

Condensed Portfolio Holdings (Unaudited) continued

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

Investments in Securities	Balance as of October 31, 2015	Realized Gains (Losses)	Change in Unrealized Appreciation (Depreciation)	Gross Purchases	Gross Sales	Gross Transfers in	Gross Transfers out	Balance as of April 30, 2016
Common Stock
Australia	$331,346	$—	($1,262)	$—	($330,084)	$—	$—	$—
Singapore	139,793	—	—	—	—	—	(139,793)	—
Rights
Australia	1,965	2,292	(1,965)	—	(2,292)	—	—	—
Italy	2	—	(2)	—	—	—	—	—
Total	$473,106	$2,292	($3,229)	$—	($332,376)	$—	($139,793)	$—

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, 2016. The transfers in the amount of $5,369,619 and $8,212,975 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 the amount of $139,793 from Level 3 to Level 2 is a result of the availability of current and reliable market-based data provided by third-party pricing services or other valuation techniques which utilize significant observable inputs.

44 See financial notes

Schwab Fundamental Emerging Markets Large Company Index Fund

Financial Statements

Financial Highlights

	11/1/15– 4/30/16*	11/1/14– 10/31/15	11/1/13– 10/31/14	11/1/12– 10/31/13	11/1/11– 10/31/12	11/1/10– 10/31/11
Per-Share Data
Net asset value at beginning of period	$6.67	$8.60	$9.24	$8.86	$9.17	$10.81
Income (loss) from investment operations:
Net investment income (loss)	0.04 ¹	0.20 ¹	0.20	0.19	0.25	0.24
Net realized and unrealized gains (losses)	0.45	(1.92)	(0.66)	0.43	(0.17)	(1.37)
Total from investment operations	0.49	(1.72)	(0.46)	0.62	0.08	(1.13)
Less distributions:
Distributions from net investment income	(0.19)	(0.21)	(0.18)	(0.24)	(0.22)	(0.15)
Distributions from net realized gains	—	—	—	—	(0.17)	(0.36)
Total distributions	(0.19)	(0.21)	(0.18)	(0.24)	(0.39)	(0.51)
Net asset value at end of period	$6.97	$6.67	$8.60	$9.24	$8.86	$9.17
Total return	7.87% ²	(20.28%)	(5.03%)	7.11%	1.18%	(10.99%)
Ratios/Supplemental Data
Ratios to average net assets:
Net operating expenses	0.49% ³	0.49%	0.49%	0.51% ⁴^,⁵	0.56% ⁶	0.61% ⁷
Gross operating expenses	0.90% ³	0.85%	0.85%	0.88%	0.91%	0.91%
Net investment income (loss)	1.35% ³	2.61%	2.35%	2.22%	2.75%	2.51%
Portfolio turnover rate	11% ²	27%	19%	22%	86% ⁸	56%
Net assets, end of period (x 1,000,000)	$315	$304	$346	$353	$314	$310

*	Unaudited.

Calculated based on the average shares outstanding during the period.

Not annualized.

Annualized (except for proxy costs).

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 51%, if rebalancing trades had not been included due to a change in the fund's index.

48 See financial notes

Schwab Fundamental Emerging Markets Large Company Index Fund

Condensed Portfolio Holdings as of April 30, 2016 (Unaudited)

Holdings by Category		Cost ($)	Value ($)
86.8%	Common Stock	285,158,289	273,556,088
11.9%	Preferred Stock	48,005,510	37,555,735
0.1%	Other Investment Company	309,500	309,500
1.3%	Short-Term Investments	4,167,389	4,167,389
100.1%	Total Investments	337,640,688	315,588,712
(0.1%)	Other Assets and Liabilities, Net		(337,396)
100.0%	Net Assets		315,251,316

Security	Number of Shares	% of Net Assets	Value ($)
Common Stock 86.8% of net assets
Brazil 8.0%
Ambev S.A.	387,750	0.7	2,186,079
Banco do Brasil S.A.	421,515	0.9	2,709,805
Companhia Siderurgica Nacional S.A. *	351,616	0.4	1,343,384
Petroleo Brasileiro S.A. *	1,546,558	1.9	5,967,238
Vale S.A.	830,776	1.5	4,756,264
Other Securities		2.6	8,253,604
		8.0	25,216,374
Chile 0.7%
Other Securities		0.7	2,190,631
China 14.2%
Bank of China Ltd., Class H	7,988,234	1.0	3,234,391
China Construction Bank Corp., Class H	9,498,960	1.9	6,033,046
China Mobile Ltd.	526,555	1.9	6,045,254
China Petroleum & Chemical Corp., Class H	6,123,400	1.4	4,315,065
CNOOC Ltd.	2,513,075	1.0	3,104,452
Industrial & Commercial Bank of China Ltd., Class H	9,109,172	1.6	4,877,059

Security	Number of Shares	% of Net Assets	Value ($)
PetroChina Co., Ltd., Class H	3,170,000	0.7	2,319,267
Other Securities		4.7	14,794,100
		14.2	44,722,634
Colombia 0.4%
Other Securities		0.4	1,224,722
Czech Republic 0.3%
Other Securities		0.3	800,893
Greece 0.5%
Other Securities		0.5	1,521,448
Hungary 0.5%
Other Securities		0.5	1,682,659
India 3.8%
Infosys Ltd.	86,702	0.5	1,577,266
Reliance Industries Ltd.	198,961	0.9	2,941,333
Other Securities		2.4	7,504,250
		3.8	12,022,849
Indonesia 1.2%
Other Securities		1.2	3,803,187
Malaysia 2.0%
Other Securities		2.0	6,208,137
Mexico 3.4%
America Movil S.A.B. de C.V., Series L	4,218,919	1.0	2,981,871
Other Securities		2.4	7,644,652
		3.4	10,626,523
Peru 0.2%
Other Securities		0.2	535,436
Philippines 0.1%
Other Securities		0.1	400,857
Poland 2.0%
Polski Koncern Naftowy Orlen S.A.	91,630	0.5	1,652,590
Other Securities		1.5	4,752,743
		2.0	6,405,333
Republic of Korea 16.6%
Hyundai Heavy Industries Co., Ltd. *	15,123	0.5	1,529,999
Hyundai Mobis Co., Ltd.	8,441	0.6	1,923,718
Hyundai Motor Co.	24,266	1.0	3,044,693
Kia Motors Corp.	48,318	0.7	2,026,538
Korea Electric Power Corp.	29,484	0.5	1,601,534
LG Chem Ltd.	5,774	0.5	1,497,741
LG Electronics, Inc.	33,020	0.5	1,680,220
POSCO	21,328	1.4	4,468,538
Samsung Electronics Co., Ltd.	12,917	4.5	14,077,342
Shinhan Financial Group Co., Ltd.	46,095	0.5	1,690,117

See financial notes 49

Schwab Fundamental Emerging Markets Large Company Index Fund

Condensed Portfolio Holdings (Unaudited) continued

Security	Number of Shares	% of Net Assets	Value ($)
SK Innovation Co., Ltd.	21,366	0.9	2,885,635
Other Securities		5.0	15,778,439
		16.6	52,204,514
Russia 13.0%
Gazprom PAO *	4,104,000	3.4	10,674,295
Gazprom PAO ADR	1,031,000	1.7	5,357,054
Lukoil PJSC	215,336	2.9	9,149,017
Sberbank of Russia *	698,260	0.4	1,331,892
Surgutneftegas *	6,903,005	1.1	3,634,142
Tatneft PAO ADR *	333,680	0.6	1,756,427
Other Securities		2.9	9,078,966
		13.0	40,981,793
South Africa 6.4%
AngloGold Ashanti Ltd. *	87,095	0.4	1,415,841
MTN Group Ltd.	293,132	1.0	3,068,652
Sasol Ltd.	112,917	1.2	3,693,532
Standard Bank Group Ltd.	149,198	0.4	1,339,848
Other Securities		3.4	10,713,956
		6.4	20,231,829
Taiwan 10.6%
Chunghwa Telecom Co., Ltd.	435,906	0.5	1,471,721
Formosa Chemicals & Fibre Corp.	534,442	0.4	1,361,858
Hon Hai Precision Industry Co., Ltd.	1,760,424	1.3	4,193,441
Taiwan Semiconductor Manufacturing Co., Ltd.	1,114,103	1.6	5,118,599
Other Securities		6.8	21,338,255
		10.6	33,483,874
Thailand 1.4%
PTT PCL	205,587	0.6	1,789,248
Other Securities		0.8	2,645,981
		1.4	4,435,229
Turkey 1.5%
Other Securities		1.5	4,857,166
Total Common Stock
(Cost $285,158,289)			273,556,088

Preferred Stock 11.9% of net assets
Brazil 9.0%
Banco Bradesco S.A.	473,816	1.1	3,568,172
Gerdau S.A.	670,306	0.5	1,522,160
Itau Unibanco Holding S.A.	515,669	1.6	4,928,412
Petroleo Brasileiro S.A. *	2,524,054	2.4	7,507,763
Vale S.A.	1,178,328	1.7	5,392,712
Other Securities		1.7	5,549,491
		9.0	28,468,710
Colombia 0.1%
Other Securities		0.1	442,586

Security	Number of Shares	% of Net Assets	Value ($)
Republic of Korea 1.0%
Samsung Electronics Co., Ltd.	2,205	0.6	2,013,802
Other Securities		0.4	1,072,056
		1.0	3,085,858
Russia 1.8%
AK Transneft OAO *	1,391	1.4	4,299,328
Other Securities		0.4	1,259,253
		1.8	5,558,581
Total Preferred Stock
(Cost $48,005,510)			37,555,735

Other Investment Company 0.1% of net assets
United States 0.1%
Securities Lending Collateral 0.1%
Other Securities		0.1	309,500
Total Other Investment Company
(Cost $309,500)			309,500
Security Rate, Maturity Date	Face Amount ($)	% of Net Assets	Value ($)
Short-Term Investments 1.3% of net assets
Time Deposits 1.3%
Sumitomo Mitsui Banking Corp. 0.15%, 05/02/16 (e)	3,163,935	1.0	3,163,935
Other Securities		0.3	1,003,454
		1.3
Total Short-Term Investments
(Cost $4,167,389)			4,167,389

End of Investments.

At 04/30/16, the tax basis cost of the fund's investments was $363,600,239 and the unrealized appreciation and depreciation were $2,502,627 and ($50,514,154), respectively, with a net unrealized depreciation of ($48,011,527).

At 04/30/16, the values of certain foreign securities held by the fund aggregating $196,333,627 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 $0 or 0.0% of net assets.
(c)	All or a portion of this security is on loan. Securities on loan were valued at $292,405.
(d)	The rate shown is the 7-day yield.
(e)	The rate shown is the current daily overnight rate.

50 See financial notes

Schwab Fundamental Emerging Markets Large Company Index Fund

Condensed Portfolio Holdings (Unaudited) continued

ADR —	American Depositary Receipt
GDR —	Global Depositary Receipt
Reg'd —	Registered

In additional to the above the fund held the following at 04/30/16:

	Number of Contracts	Contract Value ($)	Unrealized Appreciation ($)
Futures Contracts
MSCI EMG MKT, e-mini, Long expires 06/17/16	100	4,192,000	69,428

The following is a summary of the inputs used to value the fund's investments as of April 30, 2016 (see financial note 2(a) for additional information):

Description	Quoted Prices in Active Markets for Identical Assets (Level 1)	Other Significant Observable Inputs (Level 2)	Significant Unobservable Inputs (Level 3)	Total
Common Stock¹	$—	$137,414,609	$—	$137,414,609
Brazil	25,216,374	—	—	25,216,374
Chile	1,820,933	369,698	—	2,190,631
China	747,028	43,975,606	—	44,722,634
Colombia	1,224,722	—	—	1,224,722
Malaysia	395,575	5,812,562	—	6,208,137
Mexico	10,626,523	—	—	10,626,523
Peru	535,436	—	—	535,436
Russia	35,624,739	5,357,054	—	40,981,793
Thailand	4,116,989	318,240	—	4,435,229
Preferred Stock¹	—	3,085,858	—	3,085,858
Brazil	28,468,710	—	—	28,468,710
Colombia	442,586	—	—	442,586
Russia	5,558,581	—	—	5,558,581
Other Investment Company¹	309,500	—	—	309,500
Short-Term Investments¹	—	4,167,389	—	4,167,389
Total	$115,087,696	$200,501,016	$—	$315,588,712
Other Financial Instruments
Futures Contracts²	$69,428	$—	$—	$69,428

¹	As categorized in the complete schedule of Portfolio Holdings.
²	Futures contracts are not included in Investments in the schedule of Condensed 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 $1,057,154 and $37,435,750 from Level 1 to Level 2 and from Level 2 to Level 1, respectively, for the period ended April 30, 2016. 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.

See financial notes 51

Schwab Fundamental Emerging Markets Large Company Index Fund

Statement of

Assets and Liabilities

As of April 30, 2016; unaudited

Assets
Investments, at value (cost $337,331,188) including securities on loan of $292,405		$315,279,212
Collateral invested for securities on loan, at value (cost $309,500)	+	309,500
Total investments, at value (cost $337,640,688)		315,588,712
Foreign currency, at value (cost $789,074)		792,399
Deposit with broker for futures contracts		180,000
Receivables:
Investments sold		43,346
Fund shares sold		469,363
Dividends		170,678
Foreign tax reclaims		869
Income from securities on loan		817
Interest		34
Prepaid expenses	+	19,668
Total assets		317,265,886
Liabilities
Collateral held for securities on loan		309,500
Payables:
Investments bought		881,874
Investment adviser and administrator fees		6,966
Shareholder service fees		6,368
Fund shares redeemed		411,795
Foreign capital gains tax		188,559
Variation margin on futures contracts		14,500
Accrued expenses and other liabilities	+	195,008
Total liabilities		2,014,570
Net Assets
Total assets		317,265,886
Total liabilities	–	2,014,570
Net assets		$315,251,316
Net Assets by Source
Capital received from investors		410,101,393
Net investment income not yet distributed		803,948
Net realized capital losses		(73,488,653)
Net unrealized capital depreciation		(22,165,372)

Net Asset Value (NAV)
Net Assets	÷	Shares Outstanding	=	NAV
$315,251,316		45,260,796		$6.97

52 See financial notes

Schwab Fundamental Emerging Markets Large Company Index Fund

Statement of

Operations

For the period November 1, 2015 through April 30, 2016; unaudited

Investment Income
Dividends (net of foreign withholding tax of $433,893)		$2,582,946
Interest		1,911
Securities on loan	+	3,077
Total investment income		2,587,934
Expenses
Investment adviser and administrator fees		700,583
Shareholder service fees		106,938
Custodian fees		177,564
Index fees		120,152
Portfolio accounting fees		36,642
Transfer agent fees		26,704
Professional fees		24,231
Shareholder reports		21,950
Registration fees		13,459
Proxy fees		10,548
Independent trustees' fees		4,747
Interest expense		1,239
Other expenses	+	15,507
Total expenses		1,260,264
Expense reduction by CSIM and its affiliates	–	561,906
Net expenses	–	698,358
Net investment income		1,889,576
Realized and Unrealized Gains (Losses)
Net realized losses on investments		(26,078,126)
Net realized losses on futures contracts		(365,148)
Net realized losses on foreign currency transactions	+	(112,544)
Net realized losses		(26,555,818)
Net change in unrealized appreciation (depreciation) on investments (net of change in foreign capital gain tax of $5,633)		46,014,754
Net change in unrealized appreciation (depreciation) on futures contracts		91,361
Net change in unrealized appreciation (depreciation) on foreign currency translations	+	28,880
Net change in unrealized appreciation (depreciation)	+	46,134,995
Net realized and unrealized gains		19,579,177
Increase in net assets resulting from operations		$21,468,753

See financial notes 53

Schwab Fundamental Index Funds

Financial Notes, unaudited

1. Business Structure of the Funds:

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 Fundamental Global Real Estate Index 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 ^® 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™

2. Significant Accounting Policies:

The funds may invest in certain other investment companies (underlying funds). For specific investments in underlying funds, please refer to the complete schedule of portfolio holdings on Form N-CSRS for this reporting period, which is filed with the U.S. Securities and Exchange Commission (SEC). For more information about the underlying funds’ operations and policies, please refer to those funds’ semiannual and annual reports, which are filed with the SEC.

(a) Security Valuation:

Schwab Fundamental Index Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

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

• Futures contracts: Futures contracts are valued at their settlement prices as of the close of their exchanges.

• Short-term securities (60 days or less to maturity): A short-term security may be valued at its amortized cost when it approximates the security's market value.

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

Schwab Fundamental Index Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

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

The levels associated with valuing the funds' investments as of April 30, 2016 are disclosed in the Condensed Portfolio Holdings.

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

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. The terms of the securities lending agreements allow the funds or the lending agent to terminate any loan at any given time and the securities must be returned within the earlier of the standard trade settlement period or the specified time period under the relevant securities lending agreement. 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. 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 lending agent fees and broker rebates, associated

Schwab Fundamental Index Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

(d) Investment Income:

Schwab Fundamental Index Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

(e) Expenses:

(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:

(h) Accounting Estimates:

(i) Federal Income Taxes:

(j) Foreign Taxes:

(k) Indemnification:

3. Risk Factors:

Tracking Error Risk. As an index fund, each fund seeks to track the performance of its respective 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.

Schwab Fundamental Index Funds

Financial Notes, unaudited (continued)

3. Risk Factors (continued):

Investment Style Risk. Each fund invests in companies measured by its respective index. Each fund 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, a fund’s performance may be below that of its respective index.

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

Concentration Risk. To the extent that a fund’s or its respective 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. 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 small company stocks, for instance—a fund’s large-cap holdings could reduce performance.

Small-Cap Risk. Historically, small-cap stocks have been riskier than large-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 may be more vulnerable to adverse business or economic events than larger, more established companies. During a period when small-cap stocks fall behind other types of investments—large-cap stocks, for instance—a fund’s small-cap holdings could reduce performance.

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 strategy. 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. Investments in ADRs, GDRs and EDRs may be less liquid than the underlying shares in their primary trading market 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. Emerging market 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 developed 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.

ETF Risk. Certain funds 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

Schwab Fundamental Index Funds

Financial Notes, unaudited (continued)

3. Risk Factors (continued):

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 the market for an ETF's shares 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 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 large 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. A fund's use of derivatives could reduce the fund's performance, increase the fund's volatility, and could cause the fund to lose more than the initial amount invested.

Liquidity Risk. A fund may be unable to sell certain securities, such as illiquid securities, readily at a favorable time or price, or the fund may have to sell them at a loss.

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:

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:

% of Average Daily Net Assets	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
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%

For the period ended April 30, 2016, the aggregate advisory fee paid to CSIM by the funds, as a percentage of each fund's average daily net assets were as follows:

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
0.23%		0.25%		0.26%		0.40%		0.50%

Schwab Fundamental Index Funds

Financial Notes, unaudited (continued)

4. Affiliates and Affiliated Transactions (continued):

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, as distributor of the funds (or, in the case of payments made to Schwab acting as a service provider, pursuant to Schwab’s written agreement with the funds), and a fund will pay no more than 0.10% of the average annual daily net asset value of the fund shares owned by shareholders holding shares through such service provider. Payments under the Plan are made as described above without regard to whether the fee is more or less than the service provider’s actual cost of providing the services, and if more, such excess may be retained as profit by Schwab or the service provider.

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
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, as disclosed in each fund's Statement of Operations as Index 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:

Fund		Balance of Shares Held at 10/31/15		Gross Purchases		Gross Sales		Balance of Shares Held at 04/30/16		Market Value at 04/30/16		Realized Gains (Losses) 11/01/15 to 04/30/16		Dividends Received 11/01/15 to 04/30/16
Schwab Fundamental US Large Company Index Fund		81,215		—		(8,500)		72,715		$2,065,833		$84,291		$9,236

Schwab Fundamental Index Funds

Financial Notes, unaudited (continued)

4. Affiliates and Affiliated Transactions (continued):

	Underlying 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
Schwab MarketTrack All Equity Portfolio	1.6%	3.0%	3.5%	6.3%	8.9%
Schwab MarketTrack Growth Portfolio	1.8%	3.1%	3.0%	5.5%	7.3%
Schwab MarketTrack Balanced Portfolio	1.0%	1.7%	1.6%	3.0%	3.9%
Schwab MarketTrack Conservative Portfolio	0.3%	0.5%	0.5%	0.9%	1.0%

	Total Aggregate Transactions	Realized Gains (Losses)
Schwab Fundamental US Large Company Index Fund	$131,893,144	$24,735,892
Schwab Fundamental US Small Company Index Fund	28,078,463	1,077,979
Schwab Fundamental International Large Company Index Fund	3,874,676	78,849
Schwab Fundamental International Small Company Index Fund	3,335,801	315,045
Schwab Fundamental Emerging Markets Large Company Index Fund	1,836,846	(356,323)

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 on each fund’s Statement of Operations. For information regarding the trustees, please refer to the Trustees and Officers table at the end of this report.

Schwab Fundamental Index Funds

Financial Notes, unaudited (continued)

6. Borrowing from Banks:

7. Derivatives:

	Contract Values	Number of Contracts
Schwab Fundamental US Large Company Index Fund	$26,411,571	261
Schwab Fundamental US Small Company Index Fund	12,362,958	115
Schwab Fundamental International Large Company Index Fund	4,091,504	49
Schwab Fundamental International Small Company Index Fund	—	—
Schwab Fundamental Emerging Markets Large Company Index Fund	3,179,846	80

8. Purchases and Sales/Maturities of Investment Securities:

For the period ended April 30, 2016, 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	$193,740,575	$398,425,212
Schwab Fundamental US Small Company Index Fund	152,226,186	142,596,519
Schwab Fundamental International Large Company Index Fund	61,151,448	226,152,354
Schwab Fundamental International Small Company Index Fund	64,475,597	69,462,035
Schwab Fundamental Emerging Markets Large Company Index Fund	32,378,229	44,453,705

Schwab Fundamental Index Funds

Financial Notes, unaudited (continued)

9. Redemption Fee:

	Current Period (11/1/15-4/30/16)	Prior Period (11/1/14-10/31/15)
Schwab Fundamental US Large Company Index Fund	$57,985	$81,788
Schwab Fundamental US Small Company Index Fund	7,350	11,606
Schwab Fundamental International Large Company Index Fund	32,354	22,524
Schwab Fundamental International Small Company Index Fund	1,706	6,552
Schwab Fundamental Emerging Markets Large Company Index Fund	40,577	13,706

10. Federal Income Taxes:

Expiration Date	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
October 31, 2016	$—	$—	$2,034,097	$—	$—
October 31, 2017	—	—	58,777,944	—	—
October 31, 2018	—	—	20,948,477	—	—
No expiration*	—	—	—	946,649	29,742,049
Total	$—	$—	$81,760,518	$946,649	$29,742,049

*	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.

11. Subsequent Events:

Trustees and Officers

Independent Trustees
Name, Year of Birth, and Position(s) with the trust (Terms of office, and length of Time Served¹)	Principal Occupations During the Past Five Years	Number of Portfolios in Fund Complex Overseen by the Trustee	Other Directorships
Robert W. Burns 1959 Trustee (Trustee of Schwab Strategic Trust since 2009; The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios and Laudus Trust since 2016)	Retired/Private Investor (Jan. 2009 – present). Formerly, Managing Director, Pacific Investment Management Company, LLC (PIMCO) and President, PIMCO Funds.	97	Director, PS Business Parks, Inc. (2005 – 2012)
John F. Cogan 1947 Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust and Schwab Annuity Portfolios since 2008; Laudus Trust since 2010; Schwab Strategic Trust since 2016)	Senior Fellow, The Hoover Institution at Stanford University (Oct. 1979 – present); Senior Fellow, Stanford Institute for Economic Policy Research (2000 – present); Professor of Public Policy, Stanford University (1994 – 2015).	97	Director, Gilead Sciences, Inc. (2005 – present)
Stephen Timothy Kochis 1946 Trustee (Trustee of Schwab Strategic Trust since 2012; The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios and Laudus Trust since 2016)	CEO and Owner, Kochis Global (wealth management consulting) (May 2012 – present); Chairman and CEO, Aspiriant, LLC (wealth management) (Jan. 2008 – Apr. 2012).	97	None
David L. Mahoney 1954 Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios and Laudus Trust since 2011; Schwab Strategic Trust since 2016)	Private Investor.	97	Director, Symantec Corporation (2003 – present) Director, Corcept Therapeutics Incorporated (2004 – present) Director, Adamas Pharmaceuticals, Inc. (2009 – present)
Kiran M. Patel 1948 Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios and Laudus Trust since 2011; Schwab Strategic Trust since 2016)	Retired. Executive Vice President and General Manager of Small Business Group, Intuit, Inc. (financial software and services firm for consumers and small businesses) (Dec. 2008 – Sept. 2013).	97	Director, KLA-Tencor Corporation (2008 – present)

Independent Trustees (continued)
Name, Year of Birth, and Position(s) with the trust (Terms of office, and length of Time Served¹)	Principal Occupations During the Past Five Years	Number of Portfolios in Fund Complex Overseen by the Trustee	Other Directorships
Kimberly S. Patmore 1956 Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2016)	Consultant, Patmore Management Consulting (management consulting) (2008 – present).	97	None
Charles A. Ruffel 1956 Trustee (Trustee of Schwab Strategic Trust since 2009; The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios and Laudus Trust since 2015)	Co-Chief Executive Officer, Kudu Investment Management, LLC (financial services) (Jan. 2015 – present); Partner, Kudu Advisors, LLC (financial services) (June 2008 – Jan. 2015); Advisor, Asset International, Inc. (publisher of financial services information) (Aug. 2008 – Jan. 2015).	97	None
Gerald B. Smith 1950 Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust and Schwab Annuity Portfolios since 2000; Laudus Trust since 2010; Schwab Strategic Trust since 2016)	Chairman, Chief Executive Officer and Founder of Smith Graham & Co. (investment advisors) (Mar. 1990 – present).	97	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 The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust and Schwab Annuity Portfolios since 2008; Laudus Trust since 2010; Schwab Strategic Trust since 2016)	Senior Consultant, Goldman Sachs & Co., Inc. (investment banking and securities firm) (Jan. 2008 – present); Partner, Colgin Partners, LLC (vineyards) (Feb. 1998 – present).	97	Board Member and Chairman of the Audit Committee, Isis Pharmaceuticals (1994 – present) Lead Independent Director and Chair of Audit Committee, OUTFRONT Media Inc. (2014 – present)

Interested Trustees
Name, Year of Birth, and Position(s) with the trust (Terms of office, and length of Time Served¹)	Principal Occupations During the Past Five Years	Number of Portfolios in Fund Complex Overseen by the Trustee	Other Directorships
Walter W. Bettinger II² 1960 Chairman and Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust and Schwab Annuity Portfolios since 2008; Schwab Strategic Trust since 2009; Laudus Trust since 2010)	Director, President and Chief Executive Officer, The Charles Schwab Corporation (Oct. 2008 – present); President and Chief Executive Officer (Oct. 2008 – present), Director (May 2008 – present), Charles Schwab & Co., Inc.; Director, Charles Schwab Bank (Apr. 2006 – present); and Director, Schwab Holdings, Inc. (May 2008 – present).	97	Director, The Charles Schwab Corporation (2008 – present)

Interested Trustees (continued)
Name, Year of Birth, and Position(s) with the trust (Terms of office, and length of Time Served¹)	Principal Occupations During the Past Five Years	Number of Portfolios in Fund Complex Overseen by the Trustee	Other Directorships
Marie A. Chandoha² 1961 Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2016)	Director, President and Chief Executive Officer (Dec. 2010 – present), Chief Investment Officer (Sept. 2010 – Oct. 2011), Charles Schwab Investment Management, Inc.; Trustee (Jan. 2016 – present), President, Chief Executive Officer (Dec. 2010 – present), and Chief Investment Officer (Sept. 2010 – Oct. 2011), Schwab Funds, Laudus Funds and Schwab ETFs; Director, Charles Schwab Worldwide Funds plc and Charles Schwab Asset Management (Ireland) Limited (Jan. 2011 – present); Global Head of Fixed Income Business Division, BlackRock, Inc. (formerly Barclays Global Investors) (Mar. 2007 – Aug. 2010).	97	None
Joseph R. Martinetto² 1962 Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2016)	Senior Executive Vice President and Chief Financial Officer, The Charles Schwab Corporation and Charles Schwab & Co., Inc. (July 2015 – present); Executive Vice President and Chief Financial Officer of The Charles Schwab Corporation and Charles Schwab & Co., Inc. (May 2007 – July 2015); Director, Charles Schwab & Co., Inc. (May 2007 – present); Director (Apr. 2010 – present) and Chief Executive Officer (July 2013 – Apr. 2015), Charles Schwab Bank; Director, Executive Vice President and Chief Financial Officer, Schwab Holdings, Inc. (May 2007 – present).	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 A. Chandoha 1961 President and Chief Executive Officer (Officer of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2010)	Director, President and Chief Executive Officer (Dec. 2010 – present), Chief Investment Officer (Sept. 2010 – Oct. 2011), Charles Schwab Investment Management, Inc.; Trustee (Jan. 2016 – present), President, Chief Executive Officer (Dec. 2010 – present), and Chief Investment Officer (Sept. 2010 – Oct. 2011), Schwab Funds, Laudus Funds and Schwab ETFs; Director, Charles Schwab Worldwide Funds plc and Charles Schwab Asset Management (Ireland) Limited (Jan. 2011 – present); Global Head of Fixed Income Business Division, BlackRock, Inc. (formerly Barclays Global Investors) (Mar. 2007 – Aug. 2010).
Mark Fischer 1970 Treasurer and Chief Financial Officer (Officer of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2013)	Treasurer and Chief Financial Officer, Schwab Funds, Laudus Funds and Schwab ETFs (Jan. 2016 – present); Assistant Treasurer, Schwab Funds and Laudus Funds (Dec. 2013 – Dec. 2015), Schwab ETFs (Nov. 2013 – Dec. 2015); Vice President, Charles Schwab Investment Management, Inc. (Oct. 2013 – present); Executive Director, J.P. Morgan Investor Services (Apr. 2011 – Sept. 2013); Assistant Treasurer, Massachusetts Financial Service Investment Management (May 2005 – Mar. 2011).

Officers of the Trust (continued)
Name, Year of Birth, and Position(s) with the trust (Terms of office, and length of Time Served³)	Principal Occupations During the Past Five Years
George Pereira 1964 Senior Vice President and Chief Operating Officer (Officer of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust and Schwab Annuity Portfolios since 2004; Laudus Trust since 2006; Schwab Strategic Trust since 2009)	Senior Vice President and Chief Financial Officer (Nov. 2004 – present), Chief Operating Officer (Jan. 2011 – present), Charles Schwab Investment Management, Inc.; Senior Vice President and Chief Operating Officer (Jan. 2016 – present), Treasurer and Chief Financial Officer, Laudus Funds (June 2006 – Dec. 2015); Treasurer and Principal Financial Officer, Schwab Funds (Nov. 2004 – Dec. 2015) and Schwab ETFs (Oct. 2009 – Dec. 2015); Director, Charles Schwab Worldwide Funds plc and Charles Schwab Asset Management (Ireland) Limited (Apr. 2005 – present).
Omar Aguilar 1970 Senior Vice President and Chief Investment Officer – Equities (Officer of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2011)	Senior Vice President and Chief Investment Officer – Equities, Charles Schwab Investment Management, Inc. (Apr. 2011 – present); Senior Vice President and Chief Investment Officer – Equities, Schwab Funds, Laudus Funds and Schwab ETFs (June 2011 – present); Head of the Portfolio Management Group and Vice President of Portfolio Management, Financial Engines, Inc. (May 2009 – Apr. 2011); Head of Quantitative Equity, ING Investment Management (July 2004 – Jan. 2009).
Brett Wander 1961 Senior Vice President and Chief Investment Officer – Fixed Income (Officer of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2011)	Senior Vice President and Chief Investment Officer – Fixed Income, Charles Schwab Investment Management, Inc. (Apr. 2011 – present); Senior Vice President and Chief Investment Officer – Fixed Income, Schwab Funds, Laudus Funds and Schwab ETFs (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 (Apr. 2006 – Jan. 2008).
David Lekich 1964 Chief Legal Officer and Secretary, Schwab Funds and Schwab ETFs Vice President and Assistant Clerk, Laudus Funds (Officer of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2011)	Senior Vice President (Sept. 2011 – present), Vice President (Mar. 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 (Apr. 2011 – present) and Chief Legal Officer (Dec. 2011 – present), Schwab Funds; Vice President and Assistant Clerk, Laudus Funds (Apr. 2011 – present); Secretary (May 2011 – present) and Chief Legal Officer (Nov. 2011 – present), Schwab ETFs.
Catherine MacGregor 1964 Vice President and Assistant Secretary, Schwab Funds and Schwab ETFs Chief Legal Officer, Vice President and Clerk, Laudus Funds (Officer of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios and Laudus Trust since 2005; Schwab Strategic Trust since 2009)	Vice President, Charles Schwab & Co., Inc., Charles Schwab Investment Management, Inc. (July 2005 – present); Vice President (Dec. 2005 – present), Chief Legal Officer and Clerk (Mar. 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	Each Trustee shall hold office until the election and qualification of his or her successor, or until he or she dies, resigns or is removed. The retirement policy requires that each independent trustee retire by December 31 of the year in which the Trustee turns 74 or the Trustee’s twentieth year of service as an independent trustee on any trust in the Fund Complex, whichever occurs first.
²	Mr. Bettinger, Ms. Chandoha, and Mr. Martinetto 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/Clerk 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.

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.

cap, capitalization See “market cap.”

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.

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.

return on equity (ROE) The average yearly rate of return for each dollar of investors’ money, measured over the past five years.

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.

Proxy Voting Policies, Procedures and Results

The Schwab Funds Family^®

Stock Funds

Asset Allocation Funds

Bond Funds

Schwab Money Funds

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 many seek to preserve the value of your investment at $1 per share, it is possible to lose money.

Performance at a Glance

Total Return for the 6 Months Ended April 30, 2016
Laudus Small-Cap MarketMasters Fund
Investor Shares (Ticker Symbol: SWOSX)	-2.23%
Select Shares^® (Ticker Symbol: SWMSX)	-2.19%
Russell 2000^® Index	-1.90%
Fund Category: Morningstar Small Growth	-4.57%
Performance Details	pages 8-9

Laudus International MarketMasters Fund
Investor Shares¹ (Ticker Symbol: SWOIX)	-2.40% ²
Select Shares^®¹ (Ticker Symbol: SWMIX)	-2.32%
MSCI EAFE^® Index (Net)³	-3.07%
Fund Category: Morningstar Foreign Large Growth	-2.81%
Performance Details	pages 10-11

Minimum Initial Investment⁴
Investor Shares	$ 100
Select Shares^®	$ 50,000

For index definitions, please see the Glossary.

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.

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	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.
³	The net version of the index reflects reinvested dividends net of withholding taxes, but reflects no deductions for expenses or other taxes.
⁴	Please see the funds' prospectus for further detail and eligibility requirements.

2Laudus 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,

The past six months have proved challenging for two asset classes that can be used to diversify an investor’s portfolio: international stocks and U.S. small-cap stocks. International stocks, particularly those of large companies, struggled compared to stocks in the U.S. which extended a trend that began a few years ago. U.S. small-cap stocks, meanwhile, were hit hard at the start of 2016 as investors reacted to sluggish global growth by gravitating toward larger companies that were perceived safer. As the reporting period continued, however, a weakening U.S. dollar and changes in investor sentiment helped international and U.S. small-cap stocks to rebound in March and April. In this environment, the Laudus MarketMasters International Fund outperformed its benchmark, though both Laudus MarketMasters Funds ended the six-month reporting period with negative returns.

We believe that the current market environment is a valuable reminder of why investors should consider having exposure to various asset classes. As some asset classes perform better than others over particular periods of time and in different market environments, investing in different types of assets can help mitigate risk. The Laudus MarketMasters Funds encompass two different asset classes, and also offer diversification across investment styles and strategies. The Laudus International MarketMasters Fund and the Laudus Small-Cap MarketMasters Fund both bring together a select group of

Asset Class Performance Comparison % returns during the six months ended 4/30/2016

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.

* The net version of the index reflects reinvested dividends net of withholding taxes, but reflects no deductions for expenses or other taxes.

Laudus MarketMasters Funds3

The Investment Environment

Over the six-month reporting period ended April 30, 2016, market volatility remained heightened in most equity markets across the globe. Diverging central bank policies, highly volatile oil and commodity prices, and lackluster global growth all contributed to market fluctuations, and added to investor uncertainty. U.S. small-cap stocks, which are typically more sensitive to movements in the overall market, struggled amidst these ups and downs early in the reporting period. However, as investors became more willing to invest in riskier assets, small-cap stocks rebounded slightly in early 2016. Meanwhile, slowing global economic growth continued to weigh heavily on many international developed stocks, though the weakening of the U.S. dollar toward the end of the reporting period helped to support returns on some overseas investments in U.S. dollar terms. In this environment, the S&P 500^® Index, a bellwether for the overall U.S. stock market, returned 0.43%, while the Russell 2000^® Index, a U.S. small-cap company benchmark, returned -1.90%. Internationally, the MSCI EAFE Index (Net), a broad measure of developed international equity performance, returned -3.07% for the reporting period.

While the Fed began to slowly normalize monetary policy in the U.S., many other countries’ central banks maintained or increased their accommodative policies to stimulate economic growth. The European Central Bank expanded its asset purchase program over the reporting period, while the Bank of Japan introduced sub-zero interest rates in February. However, with recession fears lingering in parts of Europe and in Japan, the weakening of the U.S. dollar against the euro and the Japanese yen in early 2016 added to the headwinds these regions faced. The People’s Bank of China (the PBOC) also implemented additional easing measures, including lowering the reserve requirement for banks which increased the funds available for banks to make loans. These policy moves highlighted the ongoing divergence between the Fed and central banks outside the U.S., and contributed to increased volatility in currencies, stocks, and fixed-income markets.

Economic turmoil in China remained a factor in market movements across the globe. China’s economy continued to decelerate amidst slowing global demand, and uncertainty increased around the ability of the government and the PBOC to effectively manage the country’s financial situation. In January, the PBOC devalued the Chinese yuan for the second time in six months, triggering selloffs globally and sending oil prices downward. However, additional monetary easing measures appeared to be helping in some areas, as industrial output and retail sales in China both rose faster than expected in the month of March.

Laudus MarketMasters Funds5

The Investment Environment continued

During the reporting period, sharp fluctuations in oil and commodity prices continued to add to market volatility and created extra pressure in credit markets. Overall demand for oil failed to keep pace with supply, resulting in excess reserves across the globe. In December, the Organization of the Petroleum Exporting Countries (OPEC) decided to maintain current production levels despite excess supply, causing oil prices to drop even further. Falling oil prices created stress in the high-yield corporate credit market and negatively affected many financial institutions, as credit spreads widened and losses from loans to energy firms weighed on returns. The Fed’s dovish monetary policy and an agreement by several key OPEC members to limit supply helped oil to rally in February, and also supported a rebound in many global stocks. Despite additional price fluctuations toward the end of the reporting period, oil finished its best month of the year in April.

With diverging central bank policies, sharp oil price fluctuations, and continued weak global economic growth, the six-month reporting period saw heightened levels of volatility in both U.S. and international stock markets. Fed policy and a weaker U.S. dollar counteracted some accommodative policy measures in Europe and Japan, where recession fears lingered. The state of China’s economy remained a large factor in investor sentiment across the globe, though some signs of improvement emerged toward the end of the reporting period. Overall, U.S. and international equities were affected by many of the same market events, and were not immune to the impacts of an uncertain global economic environment.

Index figures assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged and cannot be invested in directly. Performance results less than one year are not annualized. Past performance is not an indication of future results.

For index definitions, please see the Glossary.

Management views may have changed since the report date.

6Laudus MarketMasters Funds

Laudus Small-Cap MarketMasters Fund

Performance and Fund Facts as of 04/30/16

Average Annual Total Returns^1,2

Fund and Inception Date	6 Months	1 Year	5 Years	10 Years
Investor Shares (9/16/97)	-2.23%	-8.63%	4.25%	3.69%
Select Shares^® (6/9/04)	-2.19%	-8.48%	4.41%	3.85%
Russell 2000^® Index	-1.90%	-5.94%	6.98%	5.42%
Fund Category: Morningstar Small Growth	-4.57%	-8.18%	5.99%	5.50%

Fund Expense Ratios³: Investor Shares: Net 1.35%; Gross 1.55% / Select Shares: Net 1.20%; Gross 1.51%

Investment Managers and Allocations⁴

Investment Managers	Investment Style	% of Net Assets
Wellington Management Company, LLP	Small-Cap Value	49.4%
BMO Asset Management Corp.	Small-Cap Growth	39.6%
Mellon Capital Management Corp.	Small-Cap Value	9.6%
Cash & other assets	—	1.4%

For index definitions, please see the Glossary.

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 the investment 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.

8Laudus MarketMasters Funds

Laudus International MarketMasters Fund

Performance and Fund Facts as of 04/30/16

Average Annual Total Returns^1,2

Fund and Inception Date	6 Months	1 Year	5 Years	10 Years
Investor Shares (10/16/96)	-2.40% ³	-7.73%	2.51%	3.82%
Select Shares^® (4/2/04)	-2.32%	-7.57%	2.67%	3.98%
MSCI EAFE^® Index (Net)⁴	-3.07%	-9.32%	1.69%	1.61%
MSCI EAFE^® Index (Gross)	-2.82%	-8.89%	2.16%	2.09%
Fund Category: Morningstar Foreign Large Growth	-2.81%	-7.88%	1.88%	2.43%

Fund Expense Ratios⁵: Investor Shares: Net 1.40%; Gross 1.59% / Select Shares: Net 1.25%; Gross 1.50%

Investment Managers and Allocations⁶

Investment Managers	Investment Style	% of Net Assets
American Century Investment Management, Inc.	International Small-Cap Growth	26.3%
Harris Associates L.P.	International Large-Cap Value	23.4%
William Blair Investment Management, LLC	International Multi-Cap Growth	20.6%
Mondrian Investment Partners Limited	International Small-Cap Value	24.4%
Mellon Capital Management Corp.	International Blend	3.7%
Cash & other assets	—	1.6%

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	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	The net version of the index reflects reinvested dividends net of withholding taxes, but reflects no deductions for expenses or other taxes.
⁵	As stated in the prospectus. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as the investment 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	For more information about each of the investment manager's investment styles, refer to the fund's prospectus.

10Laudus MarketMasters Funds

Laudus International MarketMasters Fund

Performance and Fund Facts as of 04/30/16 continued

Statistics
Number of Holdings	1,180
Weighted Average Market Cap (millions)	$20,907
Price/Earnings Ratio (P/E)	21.8
Price/Book Ratio (P/B)	2.0
Portfolio Turnover Rate	35%

Sector Weightings % of Investments
Industrials	22.6%
Financials	20.3%
Consumer Discretionary	18.9%
Information Technology	10.6%
Materials	7.8%
Consumer Staples	5.9%
Health Care	5.7%
Energy	2.6%
Utilities	1.7%
Telecommunication Services	1.0%
Other	2.9%
Total	100.0%

Top Equity Holdings % of Net Assets¹
Credit Suisse Group AG – Reg'd	1.1%
Glencore plc	1.1%
Nifco, Inc.	1.0%
BNP Paribas S.A.	1.0%
Honda Motor Co., Ltd.	0.8%
Croda International plc	0.8%
Nomura Holdings, Inc.	0.8%
Rubis S.C.A.	0.8%
Samsung Electronics Co., Ltd.	0.7%
Intesa Sanpaolo S.p.A.	0.7%
Total	8.8%

Country Weightings % of Investments

United Kingdom	17.0%
Japan	15.8%
France	9.4%
Germany	7.7%
Switzerland	5.8%
Australia	5.6%
Canada	4.7%

Sweden	4.2%
United States	3.4%
Italy	2.7%
Singapore	2.7%
China	2.6%
Other Countries	18.4%
Total	100.0%

Portfolio holdings may have changed since the report date.

Source of Sector Classification: S&P and MSCI.

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

Laudus MarketMasters Funds11

Fund Expenses (Unaudited)

Examples for a $1,000 Investment

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.

	Expense Ratio¹ (Annualized)	Beginning Account Value at 11/1/15	Ending Account Value (Net of Expenses) at 4/30/16	Expenses Paid During Period² 11/1/15–4/30/16
Laudus Small-Cap MarketMasters Fund
Investor Shares
Actual Return	1.35%	$1,000.00	$ 977.70	$ 6.64
Hypothetical 5% Return	1.35%	$1,000.00	$ 1,018.19	$ 6.77
Select Shares
Actual Return	1.20%	$1,000.00	$ 978.10	$5.90
Hypothetical 5% Return	1.20%	$1,000.00	$ 1,018.93	$ 6.02
Laudus International MarketMasters Fund
Investor Shares
Actual Return	1.40%	$1,000.00	$ 976.40	$6.88
Hypothetical 5% Return	1.40%	$1,000.00	$ 1,017.94	$ 7.02
Select Shares
Actual Return	1.25%	$1,000.00	$ 976.80	$ 6.14
Hypothetical 5% Return	1.25%	$1,000.00	$1,018.68	$ 6.27

¹	Based on the most recent six-month expense ratio; may differ from the expense ratio provided in the Financial Highlights. This ratio also does not include certain non-routine expenses, such as proxy expenses.
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 182 days of the period, and divided by the 366 days of the fiscal year.

12Laudus MarketMasters Funds

Laudus Small-Cap MarketMasters Fund

Financial Statements

Financial Highlights

Investor Shares	11/1/15– 4/30/16*	11/1/14– 10/31/15	11/1/13– 10/31/14	11/1/12– 10/31/13	11/1/11– 10/31/12	11/1/10– 10/31/11
Per-Share Data
Net asset value at beginning of period	$17.42	$18.02	$17.28	$13.14	$11.99	$11.52
Income (loss) from investment operations:
Net investment income (loss)¹	0.01	(0.05)	(0.05)	(0.02)	(0.10)	(0.09)
Net realized and unrealized gains (losses)	(0.41)	(0.17) ²	0.79	4.16	1.25	0.56
Total from investment operations	(0.40)	(0.22)	0.74	4.14	1.15	0.47
Less distributions:
Distributions from net investment income	—	(0.03)	—	—	—	—
Distributions from net realized gains	(1.06)	(0.35)	—	—	—	—
Total distributions	(1.06)	(0.38)	—	—	—	—
Net asset value at end of period	$15.96	$17.42	$18.02	$17.28	$13.14	$11.99
Total return	(2.23%) ³	(1.18%)	4.28%	31.51%	9.59%	4.08%
Ratios/Supplemental Data
Ratios to average net assets:
Net operating expenses	1.35% ⁴	1.35%	1.35%	1.35%	1.42% ⁵	1.46%
Gross operating expenses	1.57% ⁴	1.55%	1.56%	1.59%	1.59%	1.51%
Net investment income (loss)	0.11% ⁴	(0.26%)	(0.26%)	(0.16%)	(0.79%)	(0.70%)
Portfolio turnover rate	21% ³	51%	79%	97%	144%	95%
Net assets, end of period (x 1,000,000)	$57	$62	$70	$76	$65	$62

Select Shares	11/1/15– 4/30/16*	11/1/14– 10/31/15	11/1/13– 10/31/14	11/1/12– 10/31/13	11/1/11– 10/31/12	11/1/10– 10/31/11
Per-Share Data
Net asset value at beginning of period	$17.73	$18.33	$17.56	$13.33	$12.14	$11.64
Income (loss) from investment operations:
Net investment income (loss)¹	0.02	(0.02)	(0.02)	(0.00) ⁶	(0.08)	(0.07)
Net realized and unrealized gains (losses)	(0.42)	(0.17) ²	0.79	4.23	1.27	0.57
Total from investment operations	(0.40)	(0.19)	0.77	4.23	1.19	0.50
Less distributions:
Distributions from net investment income	—	(0.06)	—	—	—	—
Distributions from net realized gains	(1.06)	(0.35)	—	—	—	—
Total distributions	(1.06)	(0.41)	—	—	—	—
Net asset value at end of period	$16.27	$17.73	$18.33	$17.56	$13.33	$12.14
Total return	(2.19%) ³	(0.99%)	4.39%	31.73%	9.80%	4.30%
Ratios/Supplemental Data
Ratios to average net assets:
Net operating expenses	1.20% ⁴	1.20%	1.20%	1.20%	1.27% ⁵	1.31%
Gross operating expenses	1.52% ⁴	1.51%	1.51%	1.53%	1.51%	1.45%
Net investment income (loss)	0.25% ⁴	(0.09%)	(0.13%)	(0.03%)	(0.60%)	(0.54%)
Portfolio turnover rate	21% ³	51%	79%	97%	144%	95%
Net assets, end of period (x 1,000,000)	$99	$107	$122	$113	$88	$219

*	Unaudited.

Calculated based on the average shares outstanding during the period.

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 sales and repurchases of fund shares in relation to fluctuating market values.

Not annualized.

⁴

Annualized (except for proxy costs).

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

Per-share amount was less than $0.005.

See financial notes 13

Laudus Small-Cap MarketMasters Fund

Portfolio Holdings as of April 30, 2016 (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 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 fund also makes available its complete schedule of portfolio holdings 15-20 days after calendar quarters on the fund's website at www.csimfunds.com/laudusfunds_prospectus.

Holdings by Category		Cost ($)	Value ($)
94.8%	Common Stock	140,075,201	148,292,576
5.3%	Other Investment Companies	8,320,268	8,283,601
0.0%	Rights	3,578	3,047
0.0%	Warrants	—	—
0.0%	Short-Term Investment	6,997	6,999
100.1%	Total Investments	148,406,044	156,586,223
(0.1%)	Other Assets and Liabilities, Net		(119,595)
100.0%	Net Assets		156,466,628

Security	Number of Shares	Value ($)
Common Stock 94.8% of net assets
Automobiles & Components 0.1%
American Axle & Manufacturing Holdings, Inc. *	694	10,764
Cooper Tire & Rubber Co.	549	18,962
Cooper-Standard Holding, Inc. *	71	5,475
Dana Holding Corp.	1,373	17,753
Dorman Products, Inc. *	200	10,758
Drew Industries, Inc.	267	17,309
Federal-Mogul Holdings Corp. *	125	1,155
Fox Factory Holding Corp. *	87	1,506
Gentherm, Inc. *	320	11,757
Horizon Global Corp. *	182	2,233
Metaldyne Performance Group, Inc.	77	1,227
Motorcar Parts of America, Inc. *	132	4,233
Standard Motor Products, Inc.	198	7,031
Strattec Security Corp.	22	1,164
Superior Industries International, Inc.	374	9,769
Tenneco, Inc. *	548	29,208
Tower International, Inc.	122	2,800
		153,104
Banks 9.7%
1st Source Corp.	183	6,303
Access National Corp.	71	1,396
American National Bankshares, Inc.	73	1,951
Ameris Bancorp	222	6,971
Ames National Corp.	74	1,908
Arrow Financial Corp.	70	1,971

Security	Number of Shares	Value ($)
Astoria Financial Corp.	709	10,663
Banc of California, Inc.	427	8,689
BancFirst Corp.	49	3,056
Banco Latinoamericano de Comercio Exterior, S.A., Class E	60	1,552
BancorpSouth, Inc.	1,069	25,111
Bank of Marin Bancorp	43	2,108
Bank of the Ozarks, Inc.	733	30,273
Banner Corp.	165	7,059
Bar Harbor Bankshares	42	1,457
BBCN Bancorp, Inc.	970	15,151
Bear State Financial, Inc.	162	1,594
Beneficial Bancorp, Inc. *	1,066	14,807
Berkshire Hills Bancorp, Inc.	102	2,768
Blue Hills Bancorp, Inc.	101	1,473
BNC Bancorp	198	4,427
BofI Holding, Inc. *	612	12,466
Boston Private Financial Holdings, Inc.	1,095	13,381
Bridge Bancorp, Inc.	186	5,662
Brookline Bancorp, Inc.	687	7,818
Bryn Mawr Bank Corp.	73	2,075
BSB Bancorp, Inc. *	66	1,569
C1 Financial, Inc. *	76	1,864
Camden National Corp.	47	2,045
Capital Bank Financial Corp., Class A	90	2,721
Capital City Bank Group, Inc.	144	2,134
Capitol Federal Financial, Inc.	1,352	17,968
Cardinal Financial Corp.	65	1,438
Cascade Bancorp *	518	3,134
Cathay General Bancorp	833	25,423
CenterState Banks, Inc.	547	8,911
Central Pacific Financial Corp.	17	397
Century Bancorp, Inc., Class A	48	2,040
Charter Financial Corp.	168	2,105
Chemical Financial Corp.	450	17,307
Citizens & Northern Corp.	402	8,116
City Holding Co.	117	5,747
Clifton Bancorp, Inc.	549	8,169
CNB Financial Corp.	102	1,825
CoBiz Financial, Inc.	304	3,681
Columbia Banking System, Inc.	565	16,662
Community Bank System, Inc.	438	17,332
Community Trust Bancorp, Inc.	185	6,636
CommunityOne Bancorp *	133	1,756
ConnectOne Bancorp, Inc.	278	4,784
CU Bancorp *	137	3,156
Customers Bancorp, Inc. *	126	3,273
CVB Financial Corp.	970	16,665
Dime Community Bancshares, Inc.	190	3,441
Eagle Bancorp, Inc. *	294	14,906
Enterprise Bancorp, Inc.	99	2,389
Enterprise Financial Services Corp.	341	9,333
Essent Group Ltd. *	754	15,397
EverBank Financial Corp.	1,069	16,121
F.N.B. Corp.	2,210	29,216
Farmers Capital Bank Corp.	54	1,518
FCB Financial Holdings, Inc., Class A *	108	3,775
Fidelity Southern Corp.	212	3,426
Financial Institutions, Inc.	161	4,508
First Bancorp (North Carolina)	173	3,529
First BanCorp (Puerto Rico) *	1,156	4,508
First Bancorp, Inc.	103	2,045

14 See financial notes

Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
First Busey Corp.	36,059	737,046
First Business Financial Services, Inc.	124	3,138
First Citizens BancShares, Inc., Class A	72	18,360
First Commonwealth Financial Corp.	504	4,627
First Connecticut Bancorp, Inc.	350	6,031
First Defiance Financial Corp.	73	2,889
First Financial Bancorp	854	16,653
First Financial Bankshares, Inc.	644	20,853
First Financial Corp.	124	4,393
First Interstate BancSystem, Inc., Class A	51	1,382
First Merchants Corp.	290	7,439
First Midwest Bancorp, Inc.	83,503	1,543,135
First NBC Bank Holding Co. *	118	2,565
First Niagara Financial Group, Inc.	92,470	976,483
FirstMerit Corp.	1,724	38,204
Flagstar Bancorp, Inc. *	177	4,190
Flushing Financial Corp.	40,202	802,030
Fox Chase Bancorp, Inc.	103	2,030
Fulton Financial Corp.	1,202	16,816
German American Bancorp, Inc.	77	2,482
Glacier Bancorp, Inc.	729	18,874
Great Southern Bancorp, Inc.	188	7,118
Great Western Bancorp, Inc.	37,708	1,188,556
Green Bancorp, Inc. *	94	767
Guaranty Bancorp	155	2,545
Hampton Roads Bankshares, Inc. *	883	1,554
Hancock Holding Co.	37,758	980,575
Hanmi Financial Corp.	351	8,115
Heartland Financial USA, Inc.	62	2,078
Heritage Commerce Corp.	248	2,589
Heritage Oaks Bancorp	282	2,355
Hilltop Holdings, Inc. *	534	10,605
Hingham Institution for Savings	14	1,792
Home BancShares, Inc.	636	27,342
HomeStreet, Inc. *	61	1,315
HomeTrust Bancshares, Inc. *	40	742
Horizon Bancorp	84	2,050
IBERIABANK Corp.	312	18,405
Impac Mortgage Holdings, Inc. *	74	1,051
Independent Bank Corp., Massachusetts	171	8,042
Independent Bank Group, Inc.	88	3,221
International Bancshares Corp.	59,357	1,554,560
Investors Bancorp, Inc.	2,824	32,617
Kearny Financial Corp.	546	6,891
Lakeland Bancorp, Inc.	280	3,105
Lakeland Financial Corp.	158	7,472
LegacyTexas Financial Group, Inc.	499	12,305
LendingTree, Inc. *	10,872	972,718
MainSource Financial Group, Inc.	122	2,666
MB Financial, Inc.	37,383	1,299,433
Mercantile Bank Corp.	158	3,811
Merchants Bancshares, Inc.	58	1,766
Meridian Bancorp, Inc.	109	1,594
Meta Financial Group, Inc.	84	4,168
MGIC Investment Corp. *	2,696	19,492
MidWestOne Financial Group, Inc.	70	1,985
National Bank Holdings Corp., Class A	520	10,395
National Bankshares, Inc.	94	3,383
National Commerce Corp. *	60	1,436
Nationstar Mortgage Holdings, Inc. *	752	8,716

Security	Number of Shares	Value ($)
NBT Bancorp, Inc.	497	14,085
NMI Holdings, Inc., Class A *	429	2,698
Northfield Bancorp, Inc.	96	1,523
Northwest Bancshares, Inc.	102,564	1,437,947
OceanFirst Financial Corp.	444	8,649
Ocwen Financial Corp. *	448	1,012
OFG Bancorp	434	3,832
Old National Bancorp	1,182	15,832
Old Second Bancorp, Inc.	224	1,604
Opus Bank	40	1,445
Oritani Financial Corp.	482	8,353
Pacific Continental Corp.	150	2,499
Pacific Premier Bancorp, Inc. *	85	1,977
Park National Corp.	92	8,446
Park Sterling Corp.	898	6,555
Peapack-Gladstone Financial Corp.	245	4,689
Penns Woods Bancorp, Inc.	41	1,706
PennyMac Financial Services, Inc., Class A *	80	1,019
Peoples Bancorp, Inc.	147	3,159
Peoples Financial Services Corp.	59	2,326
PHH Corp. *	600	7,698
Pinnacle Financial Partners, Inc.	365	17,947
Preferred Bank	104	3,303
PrivateBancorp, Inc.	596	24,800
Prosperity Bancshares, Inc.	565	29,815
Provident Financial Services, Inc.	491	9,810
QCR Holdings, Inc.	2	52
Radian Group, Inc.	1,969	25,184
Renasant Corp.	321	11,023
Republic Bancorp, Inc., Class A	75	2,048
S&T Bancorp, Inc.	199	5,108
Sandy Spring Bancorp, Inc.	230	6,576
Seacoast Banking Corp. of Florida *	93	1,508
ServisFirst Bancshares, Inc.	80	3,942
Sierra Bancorp	117	2,060
Simmons First National Corp., Class A	206	9,620
South State Corp.	184	12,876
Southside Bancshares, Inc.	333	9,727
Southwest Bancorp, Inc.	261	4,189
State Bank Financial Corp.	192	4,009
Sterling Bancorp	1,024	16,732
Stock Yards Bancorp, Inc.	68	2,750
Stonegate Mortgage Corp. *	137	790
Suffolk Bancorp	99	2,375
Sun Bancorp, Inc. *	108	2,321
Talmer Bancorp, Inc., Class A	355	6,887
Territorial Bancorp, Inc.	73	1,915
Texas Capital Bancshares, Inc. *	409	18,740
The First of Long Island Corp.	76	2,326
Tompkins Financial Corp.	76	4,966
Towne Bank	375	7,875
TriCo Bancshares	237	6,380
TriState Capital Holdings, Inc. *	128	1,710
Triumph Bancorp, Inc. *	111	1,764
Trustmark Corp.	476	11,667
UMB Financial Corp.	369	20,572
Umpqua Holdings Corp.	2,276	36,029
Union Bankshares Corp.	364	9,613
United Bankshares, Inc.	517	20,003
United Community Banks, Inc.	665	13,386
United Financial Bancorp, Inc.	505	6,555

See financial notes 15

Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Univest Corp. of Pennsylvania	90	1,777
Valley National Bancorp	1,556	14,720
Walker & Dunlop, Inc. *	116	2,558
Walter Investment Management Corp. *	288	2,088
Washington Federal, Inc.	901	21,885
Washington Trust Bancorp, Inc.	60	2,198
Waterstone Financial, Inc.	110	1,542
Webster Financial Corp.	59,510	2,180,446
WesBanco, Inc.	268	8,611
West Bancorp, Inc.	141	2,630
Westamerica Bancorp	297	14,470
Western Alliance Bancorp *	740	27,069
Wilshire Bancorp, Inc.	821	8,842
Wintrust Financial Corp.	438	22,785
WSFS Financial Corp.	324	11,061
Yadkin Financial Corp.	411	10,283
		15,190,982
Capital Goods 12.8%
AAON, Inc.	477	12,650
AAR Corp.	129	3,101
Accuride Corp. *	750	1,215
Actuant Corp., Class A	535	14,290
Advanced Drainage Systems, Inc.	257	5,942
Aegion Corp. *	205	4,352
Aerojet Rocketdyne Holdings, Inc. *	651	11,796
Aerovironment, Inc. *	310	8,953
Aircastle Ltd.	615	13,346
Alamo Group, Inc.	42	2,370
Albany International Corp., Class A	47,209	1,902,051
Allied Motion Technologies, Inc.	63	1,358
Altra Industrial Motion Corp.	222	6,371
Ameresco, Inc., Class A *	500	2,235
American Railcar Industries, Inc.	62	2,543
American Science & Engineering, Inc.	132	3,782
American Woodmark Corp. *	70	5,099
Apogee Enterprises, Inc.	190	7,874
Applied Industrial Technologies, Inc.	293	13,428
Argan, Inc.	185	6,323
Astec Industries, Inc.	123	5,953
Astronics Corp. *	241	8,905
AZZ, Inc.	190	10,435
Babcock & Wilcox Enterprises, Inc. *	43,730	999,231
Barnes Group, Inc.	10,563	343,192
Beacon Roofing Supply, Inc. *	421	17,989
Blue Bird Corp. *	110	1,189
BMC Stock Holdings, Inc. *	91	1,597
Briggs & Stratton Corp.	599	12,681
Builders FirstSource, Inc. *	89,126	988,407
CAI International, Inc. *	97	991
Chart Industries, Inc. *	355	9,138
CIRCOR International, Inc.	16,178	913,248
CLARCOR, Inc.	429	25,212
Columbus McKinnon Corp.	79	1,304
Comfort Systems USA, Inc.	437	12,887
Commercial Vehicle Group, Inc. *	186	478
Continental Building Products, Inc. *	184	3,608
Cubic Corp.	34,900	1,450,793
Curtiss-Wright Corp.	471	36,069
DigitalGlobe, Inc. *	784	17,373

Security	Number of Shares	Value ($)
Ducommun, Inc. *	33	525
DXP Enterprises, Inc. *	129	2,819
Dycom Industries, Inc. *	13,740	970,044
EMCOR Group, Inc.	667	32,336
Encore Wire Corp.	156	5,967
EnerSys	307	17,920
Engility Holdings, Inc. *	249	4,898
EnPro Industries, Inc.	253	14,821
ESCO Technologies, Inc.	32,926	1,266,992
Esterline Technologies Corp. *	284	19,499
Federal Signal Corp.	464	6,352
Franklin Electric Co., Inc.	461	14,563
FreightCar America, Inc.	151	2,590
FuelCell Energy, Inc. *	275	1,639
GATX Corp.	29,330	1,347,420
Generac Holdings, Inc. *	759	28,933
General Cable Corp.	410	6,412
Gibraltar Industries, Inc. *	214	5,660
Global Brass & Copper Holdings, Inc.	78	2,114
Granite Construction, Inc.	239	10,657
Griffon Corp.	543	8,585
H&E Equipment Services, Inc.	411	8,315
Harsco Corp.	493	3,495
HC2 Holdings, Inc. *	148	571
HEICO Corp.	6,574	403,052
HEICO Corp., Class A	233	11,925
Hexcel Corp.	15,404	697,339
Hillenbrand, Inc.	492	14,913
Hurco Cos., Inc.	62	2,008
Hyster-Yale Materials Handling, Inc.	88	5,390
Insteel Industries, Inc.	78	2,261
John Bean Technologies Corp.	331	17,258
Kadant, Inc.	176	8,334
Kaman Corp.	312	13,132
KLX, Inc. *	311	10,487
Kratos Defense & Security Solutions, Inc. *	217	1,152
L.B. Foster Co., Class A	39	768
Lawson Products, Inc. *	38	744
Lennox International, Inc.	5,377	725,626
Lindsay Corp.	135	10,322
LSI Industries, Inc.	57	721
Luxfer Holdings plc ADR	57,710	741,574
Lydall, Inc. *	251	9,234
Masonite International Corp. *	298	20,163
MasTec, Inc. *	781	17,697
Mercury Systems, Inc. *	473	9,942
Meritor, Inc. *	744	6,324
Miller Industries, Inc.	263	5,591
Moog, Inc., Class A *	313	15,293
MRC Global, Inc. *	919	12,848
Mueller Industries, Inc.	70,961	2,239,529
Mueller Water Products, Inc., Class A	1,517	16,308
MYR Group, Inc. *	220	5,612
National Presto Industries, Inc.	23	2,005
Navistar International Corp. *	302	4,557
NCI Building Systems, Inc. *	471	6,943
Neff Corp., Class A *	138	1,180
NN, Inc.	119	1,790
Nortek, Inc. *	45	2,122
Northwest Pipe Co. *	60	647
NV5 Global, Inc. *	61	1,515

16 See financial notes

Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Omega Flex, Inc.	119	3,920
Orion Marine Group, Inc. *	142	829
Patrick Industries, Inc. *	100	4,585
PGT, Inc. *	248	2,597
Plug Power, Inc. *	1,567	3,228
Ply Gem Holdings, Inc. *	176	2,578
Powell Industries, Inc.	43	1,338
Power Solutions International, Inc. *	26	337
PowerSecure International, Inc. *	432	8,087
Preformed Line Products Co.	25	1,049
Primoris Services Corp.	42,964	1,004,928
Proto Labs, Inc. *	154	9,214
Quanex Building Products Corp.	164	3,090
Raven Industries, Inc.	296	4,763
RBC Bearings, Inc. *	163	11,948
Rexnord Corp. *	757	16,503
Rush Enterprises, Inc., Class A *	275	5,415
Simpson Manufacturing Co., Inc.	256	9,626
Sparton Corp. *	100	2,146
Standex International Corp.	110	8,436
Sun Hydraulics Corp.	156	5,519
TAL International Group, Inc. *	294	5,027
TASER International, Inc. *	468	8,546
Teledyne Technologies, Inc. *	264	24,539
Tennant Co.	211	11,270
Textainer Group Holdings Ltd.	16	247
The ExOne Co. *	84	1,110
The Gorman-Rupp Co.	178	5,036
The Greenbrier Cos., Inc.	274	8,217
The KEYW Holding Corp. *	316	2,177
Thermon Group Holdings, Inc. *	56,153	1,052,307
Titan International, Inc.	80	530
Trex Co., Inc. *	281	13,333
TriMas Corp. *	72,696	1,315,798
Tutor Perini Corp. *	299	4,730
Twin Disc, Inc.	175	2,319
Univar, Inc. *	84	1,462
Universal Forest Products, Inc.	133	10,194
Vectrus, Inc. *	57	1,229
Veritiv Corp. *	37	1,518
Vicor Corp. *	299	2,867
Wabash National Corp. *	1,020	14,535
Watsco, Inc.	5,446	732,324
Watts Water Technologies, Inc., Class A	300	16,761
Woodward, Inc.	545	29,544
Xerium Technologies, Inc. *	350	1,852
		20,096,800
Commercial & Professional Supplies 8.4%
ABM Industries, Inc.	438	14,091
ACCO Brands Corp. *	147,967	1,411,605
Barrett Business Services, Inc.	134	4,155
Brady Corp., Class A	572	15,152
CBIZ, Inc. *	939	9,559
CDI Corp.	118	844
CEB, Inc.	242	14,929
CECO Environmental Corp.	172	1,135
Civeo Corp. *	252	383
CRA International, Inc. *	91	1,975
Deluxe Corp.	431	27,058
Essendant, Inc.	45,013	1,385,950

Security	Number of Shares	Value ($)
Exponent, Inc.	178	8,872
Franklin Covey Co. *	70	1,153
FTI Consulting, Inc. *	36,621	1,475,826
G&K Services, Inc., Class A	29,813	2,106,288
GP Strategies Corp. *	255	5,952
Healthcare Services Group, Inc.	729	27,593
Heidrick & Struggles International, Inc.	102	2,012
Heritage-Crystal Clean, Inc. *	114	1,186
Herman Miller, Inc.	567	17,106
HNI Corp.	417	18,231
Huron Consulting Group, Inc. *	12,665	704,301
ICF International, Inc. *	296	11,654
Insperity, Inc.	250	13,193
Interface, Inc.	670	11,403
Kelly Services, Inc., Class A	381	7,151
Kforce, Inc.	338	6,425
Kimball International, Inc., Class B	165	1,921
Knoll, Inc.	364	8,499
Korn/Ferry International	537	14,574
Matthews International Corp., Class A	21,718	1,143,236
McGrath RentCorp	152	3,706
Mistras Group, Inc. *	43,636	1,063,409
Mobile Mini, Inc.	380	12,255
MSA Safety, Inc.	316	15,196
Multi-Color Corp.	58	3,470
Navigant Consulting, Inc. *	381	6,081
NL Industries, Inc. *	152	467
On Assignment, Inc. *	23,055	831,363
Pendrell Corp. *	1,575	811
Resources Connection, Inc.	434	6,410
RPX Corp. *	446	4,942
SP Plus Corp. *	58,940	1,313,183
Steelcase, Inc., Class A	44,874	684,777
Team, Inc. *	247	7,096
Tetra Tech, Inc.	729	21,433
The Advisory Board Co. *	19,770	625,523
The Brink's Co.	348	11,776
TriNet Group, Inc. *	585	9,723
TrueBlue, Inc. *	239	4,467
UniFirst Corp.	132	14,306
US Ecology, Inc.	159	7,160
Viad Corp.	274	8,152
Volt Information Sciences, Inc. *	83	623
VSE Corp.	41	2,544
WageWorks, Inc. *	280	15,081
West Corp.	305	6,536
		13,153,902
Consumer Durables & Apparel 3.2%
Bassett Furniture Industries, Inc.	51	1,505
Beazer Homes USA, Inc. *	261	2,145
CalAtlantic Group, Inc.	772	24,990
Callaway Golf Co.	1,174	10,965
Cavco Industries, Inc. *	63	5,524
Century Communities, Inc. *	68	1,172
Cherokee, Inc. *	53	829
Columbia Sportswear Co.	7,432	435,292
Crocs, Inc. *	425	3,549
CSS Industries, Inc.	196	5,480
Deckers Outdoor Corp. *	335	19,366
Escalade, Inc.	75	895

See financial notes 17

Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Ethan Allen Interiors, Inc.	330	11,233
Flexsteel Industries, Inc.	70	2,862
G-III Apparel Group Ltd. *	304	13,756
Green Brick Partners, Inc. *	135	995
Helen of Troy Ltd. *	7,409	737,418
Hooker Furniture Corp.	57	1,414
Hovnanian Enterprises, Inc., Class A *	257	429
Iconix Brand Group, Inc. *	374	3,171
Installed Building Products, Inc. *	62	1,648
iRobot Corp. *	301	11,251
Johnson Outdoors, Inc., Class A	37	893
KB Home	859	11,657
La-Z-Boy, Inc.	21,292	550,824
LGI Homes, Inc. *	73	2,045
Libbey, Inc.	233	4,334
Lifetime Brands, Inc.	127	2,193
M.D.C. Holdings, Inc.	555	13,659
M/I Homes, Inc. *	32,936	662,014
Malibu Boats, Inc., Class A *	33	581
Marine Products Corp.	229	1,875
Meritage Homes Corp. *	360	12,251
Movado Group, Inc.	110	3,103
NACCO Industries, Inc., Class A	44	2,619
Nautilus, Inc. *	179	3,158
Oxford Industries, Inc.	166	11,026
Performance Sports Group Ltd. *	209	775
Perry Ellis International, Inc. *	300	5,715
Sequential Brands Group, Inc. *	256	1,421
Smith & Wesson Holding Corp. *	673	14,692
Steven Madden Ltd. *	471	16,490
Sturm, Ruger & Co., Inc.	143	9,156
Superior Uniform Group, Inc.	88	1,674
Taylor Morrison Home Corp., Class A *	392	5,645
The New Home Co., Inc. *	84	935
TRI Pointe Group, Inc. *	80,910	938,556
Tumi Holdings, Inc. *	452	12,059
Unifi, Inc. *	65	1,674
Universal Electronics, Inc. *	6,698	444,814
Vera Bradley, Inc. *	350	6,139
Vince Holding Corp. *	89	550
WCI Communities, Inc. *	57	911
William Lyon Homes, Class A *	68,248	962,297
Wolverine World Wide, Inc.	1,049	19,879
ZAGG, Inc. *	439	3,516
		5,025,019
Consumer Services 0.5%
2U, Inc. *	28	785
American Public Education, Inc. *	73	1,691
Apollo Education Group, Inc. *	570	4,446
Ascent Capital Group, Inc., Class A *	118	1,778
Belmond Ltd., Class A *	687	6,293
Biglari Holdings, Inc. *	15	5,609
BJ's Restaurants, Inc. *	248	11,061
Bloomin' Brands, Inc.	1,311	24,516
Bob Evans Farms, Inc.	282	12,842
Bojangles', Inc. *	62	1,093
Boyd Gaming Corp. *	958	17,857
Bravo Brio Restaurant Group, Inc. *	350	2,580
Bridgepoint Education, Inc. *	135	1,288
Bright Horizons Family Solutions, Inc. *	261	17,127

Security	Number of Shares	Value ($)
Buffalo Wild Wings, Inc. *	138	18,445
Caesars Acquisition Co., Class A *	318	2,407
Caesars Entertainment Corp. *	511	3,490
Cambium Learning Group, Inc. *	344	1,565
Capella Education Co.	123	6,803
Career Education Corp. *	498	2,659
Carrols Restaurant Group, Inc. *	137	1,906
Chegg, Inc. *	514	2,334
Churchill Downs, Inc.	120	16,102
Chuy's Holdings, Inc. *	95	2,901
ClubCorp Holdings, Inc.	286	3,818
Collectors Universe, Inc.	127	2,209
Cracker Barrel Old Country Store, Inc.	181	26,500
Dave & Buster's Entertainment, Inc. *	96	3,715
Del Frisco's Restaurant Group, Inc. *	78	1,243
Denny's Corp. *	1,146	11,334
DeVry Education Group, Inc.	602	10,445
Diamond Resorts International, Inc. *	388	8,229
DineEquity, Inc.	126	10,836
El Pollo Loco Holdings, Inc. *	260	3,429
Eldorado Resorts, Inc. *	194	2,543
Empire Resorts, Inc. *	55	915
Fiesta Restaurant Group, Inc. *	203	6,518
Grand Canyon Education, Inc. *	446	19,504
Houghton Mifflin Harcourt Co. *	1,022	20,961
International Speedway Corp., Class A	4,206	140,859
Interval Leisure Group, Inc.	663	9,362
Intrawest Resorts Holdings, Inc. *	279	2,411
Isle of Capri Casinos, Inc. *	233	3,472
J Alexander's Holdings, Inc. *	62	639
Jack in the Box, Inc.	374	25,264
K12, Inc. *	350	4,301
Kona Grill, Inc. *	71	946
Krispy Kreme Doughnuts, Inc. *	688	11,978
La Quinta Holdings, Inc. *	733	9,360
Liberty Tax, Inc.	105	1,255
LifeLock, Inc. *	765	8,905
Marriott Vacations Worldwide Corp.	253	15,848
Monarch Casino & Resort, Inc. *	67	1,273
Morgans Hotel Group Co. *	452	673
Noodles & Co. *	96	1,070
Papa John's International, Inc.	338	19,127
Papa Murphy's Holdings, Inc. *	70	879
Penn National Gaming, Inc. *	802	12,936
Pinnacle Entertainment, Inc. *	403	4,449
Popeyes Louisiana Kitchen, Inc. *	234	12,580
Potbelly Corp. *	312	4,446
Red Robin Gourmet Burgers, Inc. *	166	10,767
Regis Corp. *	454	6,206
Ruth's Hospitality Group, Inc.	135	2,144
Scientific Games Corp., Class A *	423	4,196
SeaWorld Entertainment, Inc.	723	14,409
Shake Shack, Inc., Class A *	23	840
Sonic Corp.	550	18,903
Sotheby's	501	13,647
Speedway Motorsports, Inc.	96	1,682
Strayer Education, Inc. *	108	5,361
Texas Roadhouse, Inc.	553	22,518
The Cheesecake Factory, Inc.	414	21,118
The Habit Restaurants, Inc., Class A *	106	1,776
The Marcus Corp.	350	6,772
Universal Technical Institute, Inc.	400	1,580

18 See financial notes

Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Vail Resorts, Inc.	284	36,818
Weight Watchers International, Inc. *	200	2,590
Zoe's Kitchen, Inc. *	37	1,387
		764,524
Diversified Financials 1.8%
Arlington Asset Investment Corp., Class A	488	6,315
Ashford, Inc. *	10	455
Associated Capital Group, Inc., Class A *	30	914
BBX Capital Corp., Class A *	88	1,357
BGC Partners, Inc., Class A	1,811	16,444
Calamos Asset Management, Inc., Class A	525	4,326
Cash America International, Inc.	192	7,096
Cohen & Steers, Inc.	135	5,301
Cowen Group, Inc., Class A *	568	1,979
Diamond Hill Investment Group, Inc.	21	3,680
Encore Capital Group, Inc. *	184	5,180
Enova International, Inc. *	261	2,299
Evercore Partners, Inc., Class A	402	20,759
EZCORP, Inc., Class A *	574	2,841
Fifth Street Asset Management, Inc.	40	143
Financial Engines, Inc.	484	15,590
First Cash Financial Services, Inc.	309	14,131
FNFV Group *	575	6,193
GAIN Capital Holdings, Inc.	177,136	1,213,382
GAMCO Investors, Inc., Class A	30	1,187
Green Dot Corp., Class A *	447	9,937
Greenhill & Co., Inc.	334	7,355
HFF, Inc., Class A	301	9,581
INTL FCStone, Inc. *	26	710
Investment Technology Group, Inc.	469	9,155
Janus Capital Group, Inc.	1,267	18,498
KCG Holdings, Inc., Class A *	683	9,357
Ladenburg Thalmann Financial Services, Inc. *	1,958	5,247
MarketAxess Holdings, Inc.	329	40,388
Marlin Business Services Corp.	80	1,183
Medley Management, Inc., Class A	121	791
Moelis & Co., Class A	51	1,434
Nelnet, Inc., Class A	172	7,209
NewStar Financial, Inc. *	255	2,453
OM Asset Management plc	80	1,074
On Deck Capital, Inc. *	115	992
Oppenheimer Holdings, Inc., Class A	71	1,085
PICO Holdings, Inc. *	58,356	579,475
Piper Jaffray Cos. *	236	9,844
PRA Group, Inc. *	445	14,765
Pzena Investment Management, Inc., Class A	326	2,954
Regional Management Corp. *	66	1,090
Resource America, Inc., Class A	210	1,327
Safeguard Scientifics, Inc. *	390	5,382
Solar Capital Ltd.	35,050	617,931
Stifel Financial Corp. *	558	18,364
The JG Wentworth Co., Class A *	65	75
Tiptree Financial, Inc., Class A	206	1,139
Virtu Financial, Inc., Class A	62	1,293
Virtus Investment Partners, Inc.	53	4,146

Security	Number of Shares	Value ($)
Westwood Holdings Group, Inc.	44	2,532
WisdomTree Investments, Inc.	1,273	13,863
World Acceptance Corp. *	106	4,599
ZAIS Group Holdings, Inc. *	131	359
		2,735,159
Energy 5.0%
Abraxas Petroleum Corp. *	646	982
Adams Resources & Energy, Inc.	80	3,220
Alon USA Energy, Inc.	391	4,105
Archrock, Inc.	687	6,767
Ardmore Shipping Corp.	54	505
Atwood Oceanics, Inc.	1,073	10,365
Basic Energy Services, Inc. *	197	630
Bill Barrett Corp. *	355	2,826
Bonanza Creek Energy, Inc. *	543	2,107
Bristow Group, Inc.	308	7,059
C&J Energy Services Ltd. *	545	790
Callon Petroleum Co. *	656	6,895
CARBO Ceramics, Inc.	192	2,851
Carrizo Oil & Gas, Inc. *	629	22,248
Clayton Williams Energy, Inc. *	50	906
Clean Energy Fuels Corp. *	428	1,224
Cloud Peak Energy, Inc. *	604	1,335
Contango Oil & Gas Co. *	98	1,233
Delek US Holdings, Inc.	657	10,440
DHT Holdings, Inc.	1,141	6,549
Dorian LPG Ltd. *	54,976	558,556
Earthstone Energy, Inc. *	75	1,036
Eclipse Resources Corp. *	258	627
Energy Fuels, Inc. *	294	691
Era Group, Inc. *	34,653	330,243
Erin Energy Corp. *	327	654
Evolution Petroleum Corp.	368	2,039
EXCO Resources, Inc. *	1,244	1,891
Exterran Corp. *	343	5,248
Fairmount Santrol Holdings, Inc. *	159	636
Forum Energy Technologies, Inc. *	922	15,434
Frontline Ltd.	169	1,393
GasLog Ltd.	429	5,495
Gastar Exploration, Inc. *	637	1,268
Geospace Technologies Corp. *	127	2,078
Golar LNG Ltd.	74,661	1,237,879
Green Plains, Inc.	352	6,371
Halcon Resources Corp. *	535	653
Hallador Energy Co.	121	565
Helix Energy Solutions Group, Inc. *	1,143	9,864
Hornbeck Offshore Services, Inc. *	271	3,182
Independence Contract Drilling, Inc. *	167	665
InterOil Corp. *	48,171	1,612,283
ION Geophysical Corp. *	99	907
Isramco, Inc. *	35	3,261
Jones Energy, Inc., Class A *	151	725
Key Energy Services, Inc. *	1,526	807
Matador Resources Co. *	829	17,865
McDermott International, Inc. *	2,022	9,180
Natural Gas Services Group, Inc. *	230	5,288
Navios Maritime Acquisition Corp.	707	1,365
Newpark Resources, Inc. *	427	1,994
Nordic American Offshore Ltd. *	196	1,115
Nordic American Tankers Ltd.	765	11,789

See financial notes 19

Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
North Atlantic Drilling Ltd. *	40	151
Northern Oil & Gas, Inc. *	487	2,659
Oasis Petroleum, Inc. *	1,145	11,095
Oil States International, Inc. *	365	12,644
Pacific Ethanol, Inc. *	20	95
Panhandle Oil & Gas, Inc., Class A	112	2,116
Par Pacific Holdings, Inc. *	66	1,261
Parker Drilling Co. *	1,022	3,127
Parsley Energy, Inc., Class A *	792	18,549
PDC Energy, Inc. *	402	25,242
PHI, Inc. - Non Voting Shares *	154	3,453
Pioneer Energy Services Corp. *	565	1,757
Renewable Energy Group, Inc. *	317	3,081
REX American Resources Corp. *	133	7,231
Rex Energy Corp. *	550	555
RigNet, Inc. *	67	1,146
Ring Energy, Inc. *	107	770
RSP Permian, Inc. *	39,713	1,215,615
Sanchez Energy Corp. *	321	2,886
Scorpio Tankers, Inc.	183,424	1,148,234
SEACOR Holdings, Inc. *	17,584	1,033,412
SemGroup Corp., Class A	335	10,271
Seventy Seven Energy, Inc. *	275	52
Ship Finance International Ltd.	691	10,482
Stone Energy Corp. *	432	423
Synergy Resources Corp. *	640	4,621
Teekay Tankers Ltd., Class A	1,335	5,260
Tesco Corp.	37,350	353,331
TETRA Technologies, Inc. *	1,031	7,423
Tidewater, Inc.	355	3,110
TransAtlantic Petroleum Ltd. *	161	175
Triangle Petroleum Corp. *	903	405
Ultra Petroleum Corp. *	774	242
Unit Corp. *	178	2,253
Uranium Energy Corp. *	861	698
US Silica Holdings, Inc.	654	16,710
W&T Offshore, Inc. *	247	595
Western Refining, Inc.	817	21,863
Westmoreland Coal Co. *	151	1,077
		7,880,154
Food & Staples Retailing 0.5%
Casey's General Stores, Inc.	358	40,096
Fairway Group Holdings Corp. *	350	75
Ingles Markets, Inc., Class A	68	2,453
Natural Grocers by Vitamin Cottage, Inc. *	79	1,055
PriceSmart, Inc.	184	15,923
Smart & Final Stores, Inc. *	10,581	168,450
SpartanNash, Co.	442	12,243
Sprouts Farmers Market, Inc. *	16,180	454,173
SUPERVALU, Inc. *	1,518	7,636
The Andersons, Inc.	191	6,400
The Chefs' Warehouse, Inc. *	99	1,908
United Natural Foods, Inc. *	467	16,658
Village Super Market, Inc., Class A	150	3,660
Weis Markets, Inc.	99	4,507
		735,237

Security	Number of Shares	Value ($)
Food, Beverage & Tobacco 1.4%
Alico, Inc.	40	1,156
Arcadia Biosciences, Inc. *	233	501
B&G Foods, Inc.	412	16,979
Cal-Maine Foods, Inc.	262	13,299
Calavo Growers, Inc.	64	3,659
Castle Brands, Inc. *	952	850
Coca-Cola Bottling Co. Consolidated	28	4,462
Craft Brew Alliance, Inc. *	211	1,798
Darling Ingredients, Inc. *	1,846	26,749
Dean Foods Co.	1,078	18,574
Farmer Brothers Co. *	120	3,625
Fresh Del Monte Produce, Inc.	422	18,256
Freshpet, Inc. *	70	580
Inventure Foods, Inc. *	208	1,489
J&J Snack Foods Corp.	97	9,810
John B. Sanfilippo & Son, Inc.	86	4,758
Lancaster Colony Corp.	179	20,853
Lifeway Foods, Inc. *	98	951
Limoneira Co.	88	1,574
MGP Ingredients, Inc.	87	2,299
National Beverage Corp. *	184	8,600
Omega Protein Corp. *	85	1,580
Post Holdings, Inc. *	14,828	1,065,244
Sanderson Farms, Inc.	146	13,394
Seaboard Corp. *	2	6,006
Seneca Foods Corp., Class A *	55	1,792
Snyder's-Lance, Inc.	1,627	52,015
The Boston Beer Co., Inc., Class A *	82	12,799
The Hain Celestial Group, Inc. *	17,498	732,466
Tootsie Roll Industries, Inc.	57	2,031
TreeHouse Foods, Inc. *	504	44,554
Universal Corp.	116	6,328
Vector Group Ltd.	990	21,384
		2,120,415
Health Care Equipment & Services 9.7%
AAC Holdings, Inc. *	34	700
Abaxis, Inc.	162	7,342
ABIOMED, Inc. *	7,711	749,046
Acadia Healthcare Co., Inc. *	15,543	982,162
Accuray, Inc. *	764	4,095
Aceto Corp.	352	7,895
Adeptus Health, Inc., Class A *	9,568	651,772
Air Methods Corp. *	218	8,062
Alliance HealthCare Services, Inc. *	105	755
Allscripts Healthcare Solutions, Inc. *	94,870	1,271,258
Almost Family, Inc. *	8,652	363,470
Amedisys, Inc. *	328	16,889
AMN Healthcare Services, Inc. *	28,067	996,659
Amsurg Corp. *	14,938	1,209,679
Analogic Corp.	146	11,533
AngioDynamics, Inc. *	88	1,078
Anika Therapeutics, Inc. *	42	1,918
Antares Pharma, Inc. *	419	461
AtriCure, Inc. *	367	5,835
Atrion Corp.	18	7,151
BioScrip, Inc. *	891	2,352
BioTelemetry, Inc. *	148	2,328
Cantel Medical Corp.	294	19,695

20 See financial notes

Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Capital Senior Living Corp. *	372	7,462
Cardiovascular Systems, Inc. *	172	2,405
Castlight Health, Inc., Class B *	117	421
Cerus Corp. *	591	3,700
Chemed Corp.	162	21,024
Civitas Solutions, Inc. *	23,382	468,575
Computer Programs & Systems, Inc.	180	9,239
CONMED Corp.	284	11,763
Connecture, Inc. *	77	178
Corindus Vascular Robotics, Inc. *	337	354
CorVel Corp. *	15,178	686,046
Cross Country Healthcare, Inc. *	34,442	428,114
Cutera, Inc. *	46	536
Cynosure, Inc., Class A *	104	5,090
Diplomat Pharmacy, Inc. *	183	5,543
Endologix, Inc. *	843	9,450
Entellus Medical, Inc. *	56	814
Exactech, Inc. *	178	4,048
ExamWorks Group, Inc. *	505	18,205
Five Star Quality Care, Inc. *	326	795
Genesis Healthcare, Inc. *	239	602
GenMark Diagnostics, Inc. *	323	1,909
Globus Medical, Inc., Class A *	29,912	748,996
Greatbatch, Inc. *	161	5,603
Haemonetics Corp. *	31,637	1,025,988
Halyard Health, Inc. *	604	17,009
HealthEquity, Inc. *	159	3,999
HealthSouth Corp.	20,617	854,781
HealthStream, Inc. *	236	5,338
Healthways, Inc. *	720	8,388
HeartWare International, Inc. *	144	4,804
Hill-Rom Holdings, Inc.	17,840	862,564
HMS Holdings Corp. *	647	10,928
ICU Medical, Inc. *	5,422	538,621
Imprivata, Inc. *	89	1,079
Inogen, Inc. *	33	1,612
Insulet Corp. *	426	14,186
Integra LifeSciences Holdings Corp. *	258	18,272
Invacare Corp.	201	2,259
InVivo Therapeutics Holdings Corp. *	83	498
iRadimed Corp. *	63	1,031
K2M Group Holdings, Inc. *	60	976
Kindred Healthcare, Inc.	814	12,015
Landauer, Inc.	74	2,571
LDR Holding Corp. *	202	5,444
LeMaitre Vascular, Inc.	134	2,222
LHC Group, Inc. *	187	7,544
LivaNova plc *	322	16,979
Magellan Health, Inc. *	249	17,545
Masimo Corp. *	377	16,343
Medidata Solutions, Inc. *	503	21,946
Meridian Bioscience, Inc.	626	11,963
Merit Medical Systems, Inc. *	608	12,312
Molina Healthcare, Inc. *	435	22,516
National HealthCare Corp.	93	5,994
National Research Corp., Class A	104	1,497
Natus Medical, Inc. *	354	11,282
Neogen Corp. *	304	14,361
Nevro Corp. *	55	3,699
Nobilis Health Corp. *	215	907
NuVasive, Inc. *	524	27,741
Nuvectra Corp. *	53	445

Security	Number of Shares	Value ($)
NxStage Medical, Inc. *	65,387	1,054,038
Omnicell, Inc. *	386	12,298
Orthofix International N.V. *	107	4,682
Owens & Minor, Inc.	676	24,600
Oxford Immunotec Global plc *	100	1,046
PharMerica Corp. *	382	9,030
Press Ganey Holdings, Inc. *	55	1,676
Quality Systems, Inc.	388	5,463
Quidel Corp. *	193	3,339
Rockwell Medical, Inc. *	418	3,866
RTI Surgical, Inc. *	213	850
SeaSpine Holdings Corp. *	86	1,283
Second Sight Medical Products, Inc. *	168	795
Select Medical Holdings Corp.	1,001	13,393
Sientra, Inc. *	57	463
STAAR Surgical Co. *	395	3,045
STERIS plc	11,097	784,225
Surgical Care Affiliates, Inc. *	79	3,820
SurModics, Inc. *	218	4,386
Tandem Diabetes Care, Inc. *	124	1,380
Team Health Holdings, Inc. *	563	23,550
The Ensign Group, Inc.	330	7,445
The Providence Service Corp. *	187	9,320
The Spectranetics Corp. *	697	11,849
TransEnterix, Inc. *	623	934
Trinity Biotech plc ADR	60,400	694,600
Triple-S Management Corp., Class B *	48	1,250
U.S. Physical Therapy, Inc.	27	1,346
Unilife Corp. *	555	305
Universal American Corp.	236	1,756
Utah Medical Products, Inc.	34	2,275
Vascular Solutions, Inc. *	225	7,864
Veracyte, Inc. *	126	731
Vocera Communications, Inc. *	237	2,778
WellCare Health Plans, Inc. *	434	39,056
West Pharmaceutical Services, Inc.	661	47,063
Wright Medical Group N.V. *	752	14,123
Zeltiq Aesthetics, Inc. *	307	9,179
		15,159,768
Household & Personal Products 0.0%
Central Garden & Pet Co., Class A *	573	9,334
HRG Group, Inc. *	657	9,461
Inter Parfums, Inc.	107	3,276
Natural Health Trends Corp.	118	4,270
Nature's Sunshine Products, Inc.	105	1,006
Nutraceutical International Corp. *	84	1,981
Oil-Dri Corp. of America	61	2,035
Revlon, Inc., Class A *	69	2,514
Synutra International, Inc. *	329	1,665
USANA Health Sciences, Inc. *	63	7,462
WD-40 Co.	99	10,128
		53,132
Insurance 1.4%
Ambac Financial Group, Inc. *	456	7,401
American Equity Investment Life Holding Co.	734	10,276
AMERISAFE, Inc.	3,461	186,479
Argo Group International Holdings Ltd.	185	10,170

See financial notes 21

Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Atlas Financial Holdings, Inc. *	74	1,300
Baldwin & Lyons, Inc., Class B	70	1,711
Citizens, Inc. *	419	3,415
CNO Financial Group, Inc.	1,906	35,013
Crawford & Co., Class B	204	1,375
Donegal Group, Inc., Class A	120	1,837
eHealth, Inc. *	289	3,234
EMC Insurance Group, Inc.	96	2,540
Employers Holdings, Inc.	297	8,821
Enstar Group Ltd. *	83	13,151
FBL Financial Group, Inc., Class A	152	9,191
Federated National Holding Co.	202	3,848
Fidelity & Guaranty Life	60	1,586
First American Financial Corp.	1,006	36,236
Global Indemnity plc *	72	2,264
Greenlight Capital Re Ltd., Class A *	189	4,069
Hallmark Financial Services, Inc. *	183	2,066
HCI Group, Inc.	227	6,801
Heritage Insurance Holdings, Inc.	64	851
Horace Mann Educators Corp.	328	10,201
Independence Holding Co.	146	2,244
Infinity Property & Casualty Corp.	74	5,932
James River Group Holdings Ltd.	58	1,796
Kemper Corp.	5,533	171,302
Maiden Holdings Ltd.	617	7,546
MBIA, Inc. *	529	4,126
National General Holdings Corp.	189	3,816
National Interstate Corp.	57	1,755
National Western Life Group, Inc., Class A	9	1,950
Patriot National, Inc. *	90	749
Primerica, Inc.	27,653	1,370,483
RLI Corp.	420	26,116
Safety Insurance Group, Inc.	100	5,661
Selective Insurance Group, Inc.	571	19,819
State Auto Financial Corp.	93	1,907
State National Cos., Inc.	18,634	210,192
Stewart Information Services Corp.	81	2,820
The Navigators Group, Inc. *	89	7,352
Third Point Reinsurance Ltd. *	678	7,716
Trupanion, Inc. *	171	2,132
United Fire Group, Inc.	216	9,681
United Insurance Holdings Corp.	4	65
Universal Insurance Holdings, Inc.	238	4,191
		2,233,187
Materials 2.8%
A. Schulman, Inc.	317	8,841
AEP Industries, Inc.	26	1,602
AK Steel Holding Corp. *	1,714	8,022
American Vanguard Corp.	404	6,686
Axiall Corp.	634	14,931
Balchem Corp.	318	19,512
Berry Plastics Group, Inc. *	1,178	42,432
Boise Cascade Co. *	190	3,965
Calgon Carbon Corp.	310	5,081
Carpenter Technology Corp.	411	14,554
Century Aluminum Co. *	557	4,913
Chase Corp.	76	4,278
Chemtura Corp. *	639	17,796
Clearwater Paper Corp. *	229	13,680

Security	Number of Shares	Value ($)
Cliffs Natural Resources, Inc. *	303	1,597
Coeur Mining, Inc. *	993	8,043
Commercial Metals Co.	904	16,200
Core Molding Technologies, Inc. *	63	739
Deltic Timber Corp.	18,396	1,149,750
Ferro Corp. *	1,029	13,109
Ferroglobe plc	678	6,909
Flotek Industries, Inc. *	556	5,254
FutureFuel Corp.	348	3,912
Greif, Inc., Class A	28,889	1,002,448
H.B. Fuller Co.	407	18,201
Handy & Harman Ltd. *	99	2,716
Hawkins, Inc.	42	1,643
Haynes International, Inc.	111	4,166
Headwaters, Inc. *	564	11,286
Hecla Mining Co.	2,963	12,771
Innophos Holdings, Inc.	249	9,203
Innospec, Inc.	159	7,689
Intrepid Potash, Inc. *	155	198
Kaiser Aluminum Corp.	98	9,293
KapStone Paper & Packaging Corp.	467	7,421
KMG Chemicals, Inc.	78	1,848
Koppers Holdings, Inc. *	252	6,333
Kraton Performance Polymers, Inc. *	595	13,512
Kronos Worldwide, Inc.	152	1,011
Louisiana-Pacific Corp. *	1,309	22,253
LSB Industries, Inc. *	253	3,329
Materion Corp.	153	4,435
Minerals Technologies, Inc.	278	16,652
Neenah Paper, Inc.	178	11,586
Olin Corp.	1,651	35,975
Olympic Steel, Inc.	76	1,719
OMNOVA Solutions, Inc. *	151	1,080
P.H. Glatfelter Co.	505	11,580
PolyOne Corp.	938	33,749
Quaker Chemical Corp.	100	8,906
Rayonier Advanced Materials, Inc.	90	923
Real Industry, Inc. *	110	972
Rentech, Inc. *	265	920
Ryerson Holding Corp. *	157	1,394
Schnitzer Steel Industries, Inc., Class A	485	10,001
Schweitzer-Mauduit International, Inc.	284	9,767
Sensient Technologies Corp.	24,118	1,621,935
Solazyme, Inc. *	781	1,828
Stepan Co.	87	5,332
Stillwater Mining Co. *	807	9,845
Summit Materials, Inc., Class A *	360	7,524
SunCoke Energy, Inc.	828	6,152
TimkenSteel Corp.	105	1,338
Trecora Resources *	384	4,397
Tredegar Corp.	361	5,762
Trinseo S.A. *	52	2,225
Tronox Ltd., Class A	768	5,591
United States Lime & Minerals, Inc.	34	1,821
US Concrete, Inc. *	109	6,732
Valhi, Inc.	221	435
Worthington Industries, Inc.	417	15,742
		4,353,445

22 See financial notes

Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Media 1.8%
AMC Entertainment Holdings, Inc., Class A	133	3,748
Carmike Cinemas, Inc. *	244	7,318
Central European Media Enterprises Ltd., Class A *	775	2,062
Crown Media Holdings, Inc., Class A *	678	3,437
Cumulus Media, Inc., Class A *	1,288	479
Daily Journal Corp. *	23	4,517
DreamWorks Animation SKG, Inc., Class A *	563	22,475
Entercom Communications Corp., Class A *	610	6,917
Eros International plc *	135	1,806
Global Eagle Entertainment, Inc. *	224	1,794
Gray Television, Inc. *	26,028	334,460
Hemisphere Media Group, Inc. *	122	1,459
IMAX Corp. *	554	17,728
Loral Space & Communications, Inc. *	92	3,375
MDC Partners, Inc., Class A	494	9,999
Media General, Inc. *	1,039	18,006
Meredith Corp.	257	13,187
National CineMedia, Inc.	32,722	464,652
New Media Investment Group, Inc.	78,366	1,257,774
Nexstar Broadcasting Group, Inc., Class A	314	16,118
Reading International, Inc., Class A *	278	3,606
Saga Communications, Inc., Class A	146	6,139
Scholastic Corp.	266	9,677
Sinclair Broadcast Group, Inc., Class A	16,125	517,129
Sizmek, Inc. *	490	1,299
The E.W. Scripps Co., Class A *	662	10,049
The New York Times Co., Class A	1,215	15,576
Time, Inc.	1,116	16,405
Townsquare Media, Inc., Class A *	107	1,138
Tribune Publishing Co.	88	997
World Wrestling Entertainment, Inc., Class A	152	2,529
		2,775,855
Pharmaceuticals, Biotechnology & Life Sciences 5.7%
Abeona Therapeutics, Inc. *	227	617
ACADIA Pharmaceuticals, Inc. *	856	27,649
Accelerate Diagnostics, Inc. *	200	2,510
Acceleron Pharma, Inc. *	145	4,343
Achillion Pharmaceuticals, Inc. *	1,336	11,423
Acorda Therapeutics, Inc. *	504	13,028
Adamas Pharmaceuticals, Inc. *	54	912
Aduro Biotech, Inc. *	40	518
Advaxis, Inc. *	71	550
Aegerion Pharmaceuticals, Inc. *	451	1,285
Aerie Pharmaceuticals, Inc. *	85	1,348
Affimed N.V. *	109	441
Agenus, Inc. *	449	1,580
Agile Therapeutics, Inc. *	161	932
Akebia Therapeutics, Inc. *	66	620
Akorn, Inc. *	5,166	131,475
Albany Molecular Research, Inc. *	47,718	718,156
Alder Biopharmaceuticals, Inc. *	97	2,575
Alimera Sciences, Inc. *	304	675

Security	Number of Shares	Value ($)
AMAG Pharmaceuticals, Inc. *	279	7,399
Amicus Therapeutics, Inc. *	1,196	8,934
Amphastar Pharmaceuticals, Inc. *	254	3,124
Anacor Pharmaceuticals, Inc. *	306	19,198
ANI Pharmaceuticals, Inc. *	59	2,683
Anthera Pharmaceuticals, Inc. *	171	633
Applied Genetic Technologies Corp. *	57	895
Aralez Pharmaceuticals, Inc. *	383	1,498
Aratana Therapeutics, Inc. *	208	1,250
Ardelyx, Inc. *	91	729
Arena Pharmaceuticals, Inc. *	2,410	4,145
ARIAD Pharmaceuticals, Inc. *	1,930	13,857
Array BioPharma, Inc. *	968	3,088
Arrowhead Pharmaceuticals, Inc. *	1,262	7,307
Assembly Biosciences, Inc. *	87	522
Asterias Biotherapeutics, Inc. *	325	1,394
Atara Biotherapeutics, Inc. *	169	3,044
aTyr Pharma, Inc. *	66	235
Avalanche Biotechnologies, Inc. *	284	1,602
Bellicum Pharmaceuticals, Inc. *	65	659
BioCryst Pharmaceuticals, Inc. *	486	1,584
BioDelivery Sciences International, Inc. *	473	1,599
BioSpecifics Technologies Corp. *	132	4,694
BioTime, Inc. *	43	126
Blueprint Medicines Corp. *	52	789
Calithera Biosciences, Inc. *	175	933
Cambrex Corp. *	287	13,845
Cara Therapeutics, Inc. *	341	2,080
Carbylan Therapeutics, Inc. *	203	149
Catalent, Inc. *	799	23,594
Catalyst Pharmaceuticals, Inc. *	350	238
Celldex Therapeutics, Inc. *	1,435	5,740
Cellular Biomedicine Group, Inc. *	40	691
Cempra, Inc. *	186	3,149
Cepheid *	620	17,695
Charles River Laboratories International, Inc. *	16,020	1,269,905
ChemoCentryx, Inc. *	35	84
Chimerix, Inc. *	746	4,461
Cidara Therapeutics, Inc. *	101	1,351
Clovis Oncology, Inc. *	235	3,269
Coherus Biosciences, Inc. *	53	998
Collegium Pharmaceutical, Inc. *	77	1,468
Concert Pharmaceuticals, Inc. *	89	1,241
Corcept Therapeutics, Inc. *	907	4,326
Corium International, Inc. *	104	466
CorMedix, Inc. *	298	1,246
CTI BioPharma, Corp. *	1,000	504
Curis, Inc. *	479	958
Cytokinetics, Inc. *	303	2,466
CytRx Corp. *	506	1,650
Depomed, Inc. *	745	12,948
Dermira, Inc. *	88	2,225
Dicerna Pharmaceuticals, Inc. *	3	14
Durect Corp. *	581	779
Dynavax Technologies Corp. *	416	6,827
Eagle Pharmaceuticals, Inc. *	7,577	286,865
Emergent BioSolutions, Inc. *	278	10,709
Enanta Pharmaceuticals, Inc. *	193	5,636
Endocyte, Inc. *	91	355
Epizyme, Inc. *	317	3,303

See financial notes 23

Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Esperion Therapeutics, Inc. *	54	885
Exact Sciences Corp. *	1,054	7,399
Exelixis, Inc. *	2,297	10,589
Fibrocell Science, Inc. *	127	351
FibroGen, Inc. *	207	3,726
Five Prime Therapeutics, Inc. *	157	7,472
Flex Pharma, Inc. *	73	800
Flexion Therapeutics, Inc. *	69	718
Fluidigm Corp. *	437	4,186
Foamix Pharmaceuticals Ltd. *	123	776
Foundation Medicine, Inc. *	105	1,675
Galena Biopharma, Inc. *	1,426	1,968
Genocea Biosciences, Inc. *	112	493
Genomic Health, Inc. *	284	7,463
Geron Corp. *	1,639	4,835
Halozyme Therapeutics, Inc. *	1,275	13,451
Harvard Bioscience, Inc. *	268	796
Heron Therapeutics, Inc. *	194	4,159
Heska Corp. *	49	1,499
Horizon Pharma plc *	45,434	698,321
ICON plc *	10,025	677,489
Idera Pharmaceuticals, Inc. *	589	978
Ignyta, Inc. *	87	602
Immune Design, Corp. *	60	818
ImmunoGen, Inc. *	1,141	7,816
Immunomedics, Inc. *	1,236	4,388
Impax Laboratories, Inc. *	640	21,344
INC Research Holdings, Inc., Class A *	36	1,733
Infinity Pharmaceuticals, Inc. *	656	3,805
Innoviva, Inc.	857	10,575
Inovio Pharmaceuticals, Inc. *	850	8,908
Insmed, Inc. *	477	5,796
Insys Therapeutics, Inc. *	277	4,014
Intersect ENT, Inc. *	206	4,130
Intra-Cellular Therapies, Inc. *	139	4,770
Invitae Corp. *	96	916
Ironwood Pharmaceuticals, Inc. *	1,556	16,260
Karyopharm Therapeutics, Inc. *	111	1,032
Keryx Biopharmaceuticals, Inc. *	1,269	6,903
Kite Pharma, Inc. *	228	10,552
La Jolla Pharmaceutical Co. *	64	1,185
Lannett Co., Inc. *	294	5,639
Lexicon Pharmaceuticals, Inc. *	791	10,924
Ligand Pharmaceuticals, Inc. *	171	20,669
Lion Biotechnologies, Inc. *	150	850
Loxo Oncology, Inc. *	107	2,466
Luminex Corp. *	334	6,713
MacroGenics, Inc. *	170	3,495
MannKind Corp. *	2,185	2,950
Medgenics, Inc. *	226	1,078
Merrimack Pharmaceuticals, Inc. *	1,596	11,300
MiMedx Group, Inc. *	1,098	8,268
Mirati Therapeutics, Inc. *	77	1,595
Momenta Pharmaceuticals, Inc. *	806	7,665
Myriad Genetics, Inc. *	758	27,288
NanoString Technologies, Inc. *	94	1,496
Navidea Biopharmaceuticals, Inc. *	766	1,057
Nektar Therapeutics *	1,299	20,368
NeoGenomics, Inc. *	513	4,176
Neurocrine Biosciences, Inc. *	862	39,290
NewLink Genetics Corp. *	187	3,031
Northwest Biotherapeutics, Inc. *	454	636

Security	Number of Shares	Value ($)
Novavax, Inc. *	2,608	13,666
Ocular Therapeutix, Inc. *	66	810
Omeros Corp. *	92,641	1,227,493
Oncocyte Corp. *	2	10
OncoMed Pharmaceuticals, Inc. *	102	1,265
Oncothyreon, Inc. *	612	796
Ophthotech Corp. *	169	7,899
Orexigen Therapeutics, Inc. *	1,156	517
Organovo Holdings, Inc. *	547	1,488
Osiris Therapeutics, Inc. *	165	926
Otonomy, Inc. *	64	913
OvaScience, Inc. *	118	989
Pacific Biosciences of California, Inc. *	635	6,128
Pacira Pharmaceuticals, Inc. *	12,578	680,596
Paratek Pharmaceuticals, Inc. *	55	749
PAREXEL International Corp. *	572	34,949
PDL BioPharma, Inc.	437	1,647
Peregrine Pharmaceuticals, Inc. *	2,024	717
Pernix Therapeutics Holdings, Inc. *	319	239
Pfenex, Inc. *	76	620
Phibro Animal Health Corp., Class A	26,975	559,461
Portola Pharmaceuticals, Inc. *	342	8,126
PRA Health Sciences, Inc. *	14,233	675,356
Prestige Brands Holdings, Inc. *	553	31,399
Progenics Pharmaceuticals, Inc. *	751	3,988
Proteon Therapeutics, Inc. *	89	869
Prothena Corp. plc *	221	9,545
PTC Therapeutics, Inc. *	208	1,543
Radius Health, Inc. *	190	6,764
Raptor Pharmaceutical Corp. *	660	3,241
Regulus Therapeutics, Inc. *	229	1,337
Relypsa, Inc. *	406	7,349
Repligen Corp. *	149	3,969
Retrophin, Inc. *	299	4,120
Revance Therapeutics, Inc. *	57	1,048
Rigel Pharmaceuticals, Inc. *	997	2,821
Sage Therapeutics, Inc. *	91	3,430
Sagent Pharmaceuticals, Inc. *	307	3,573
Sangamo BioSciences, Inc. *	1,259	7,932
Sarepta Therapeutics, Inc. *	593	8,415
SciClone Pharmaceuticals, Inc. *	793	10,468
Sequenom, Inc. *	797	1,020
Sorrento Therapeutics, Inc. *	86	590
Spark Therapeutics, Inc. *	22	790
Spectrum Pharmaceuticals, Inc. *	126	893
Stemline Therapeutics, Inc. *	66	363
Sucampo Pharmaceuticals, Inc., Class A *	375	4,042
Supernus Pharmaceuticals, Inc. *	362	6,212
Synergy Pharmaceuticals, Inc. *	849	2,666
Synta Pharmaceuticals Corp. *	932	373
T2 Biosystems, Inc. *	43	394
Teligent, Inc. *	309	1,706
TESARO, Inc. *	176	7,293
Tetraphase Pharmaceuticals, Inc. *	458	2,565
TG Therapeutics, Inc. *	269	2,451
The Medicines Co. *	14,607	519,863
TherapeuticsMD, Inc. *	1,305	10,766
Theravance Biopharma, Inc. *	214	4,440
Threshold Pharmaceuticals, Inc. *	1,100	484
Tobira Therapeutics, Inc. *	77	606
Tokai Pharmaceuticals, Inc. *	98	718

24 See financial notes

Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Trevena, Inc. *	221	1,722
Trovagene, Inc. *	140	563
Ultragenyx Pharmaceutical, Inc. *	267	18,055
Vanda Pharmaceuticals, Inc. *	60,366	537,257
Verastem, Inc. *	132	218
Versartis, Inc. *	63	571
Vitae Pharmaceuticals, Inc. *	183	1,316
Vital Therapies, Inc. *	63	540
VIVUS, Inc. *	1,152	1,901
XBiotech, Inc. *	72	918
Xencor, Inc. *	161	1,972
XenoPort, Inc. *	356	1,566
XOMA Corp. *	1,300	1,064
Zafgen, Inc. *	259	1,650
ZIOPHARM Oncology, Inc. *	1,146	9,008
Zogenix, Inc. *	73	748
		8,934,798
Real Estate 4.1%
Acadia Realty Trust	704	23,725
Agree Realty Corp.	205	7,950
Alexander & Baldwin, Inc.	485	18,546
Alexander's, Inc.	13	4,975
Altisource Asset Management Corp. *	14	235
Altisource Portfolio Solutions S.A. *	138	4,318
Altisource Residential Corp.	391	4,543
American Assets Trust, Inc.	397	15,749
American Capital Mortgage Investment Corp.	555	8,231
Anworth Mortgage Asset Corp.	2,026	9,563
Apollo Commercial Real Estate Finance, Inc.	487	7,758
Apollo Residential Mortgage, Inc.	655	8,882
ARMOUR Residential REIT, Inc.	542	11,534
Ashford Hospitality Prime, Inc.	39	436
Ashford Hospitality Trust, Inc.	971	5,428
AV Homes, Inc. *	49	564
Capstead Mortgage Corp.	566	5,502
CareTrust REIT, Inc.	222	2,824
CatchMark Timber Trust, Inc., Class A	121	1,284
Cedar Realty Trust, Inc.	977	6,761
Chatham Lodging Trust	257	5,477
Chesapeake Lodging Trust	553	13,620
City Office REIT, Inc.	39,781	446,741
Colony Capital, Inc., Class A	1,049	18,546
Colony Starwood Homes	276	6,726
Consolidated-Tomoka Land Co.	43	2,120
CoreSite Realty Corp.	184	13,787
Corporate Office Properties Trust	27,410	703,889
Cousins Properties, Inc.	1,917	19,841
CubeSmart	1,531	45,333
CyrusOne, Inc.	665	29,346
CYS Investments, Inc.	1,885	15,287
DCT Industrial Trust, Inc.	931	37,584
DiamondRock Hospitality Co.	67,926	605,221
DuPont Fabros Technology, Inc.	673	26,799
Dynex Capital, Inc.	400	2,600
Easterly Government Properties, Inc.	91	1,679
EastGroup Properties, Inc.	304	18,164
Education Realty Trust, Inc.	23,324	927,595
EPR Properties	511	33,665

Security	Number of Shares	Value ($)
Equity One, Inc.	726	20,546
FelCor Lodging Trust, Inc.	1,360	9,738
First Industrial Realty Trust, Inc.	1,132	25,968
First Potomac Realty Trust	864	7,266
Forestar Group, Inc. *	606	8,181
Franklin Street Properties Corp.	580	6,160
FRP Holdings, Inc. *	34	1,240
Government Properties Income Trust	905	17,123
Gramercy Property Trust	3,090	26,172
Great Ajax Corp.	104	1,416
Hannon Armstrong Sustainable Infrastructure Capital, Inc.	202	3,919
Hatteras Financial Corp.	792	12,585
Healthcare Realty Trust, Inc.	940	28,463
Hersha Hospitality Trust	539	10,397
Highwoods Properties, Inc.	951	44,440
Hudson Pacific Properties, Inc.	826	24,160
Independence Realty Trust, Inc.	198	1,420
InfraREIT, Inc. *	91	1,509
Invesco Mortgage Capital, Inc.	1,302	16,731
Investors Real Estate Trust	593	3,570
iStar, Inc. *	1,093	10,711
Kennedy-Wilson Holdings, Inc.	834	18,023
Kite Realty Group Trust	932	25,378
Ladder Capital Corp.	139	1,655
LaSalle Hotel Properties	1,212	28,967
Lexington Realty Trust	1,679	14,742
LTC Properties, Inc.	231	10,716
Mack-Cali Realty Corp.	847	21,649
Marcus & Millichap, Inc. *	31	777
Medical Properties Trust, Inc.	1,725	22,960
Monmouth Real Estate Investment Corp.	752	8,648
Monogram Residential Trust, Inc.	1,010	10,231
National Health Investors, Inc.	318	21,653
National Storage Affiliates Trust	168	3,279
New Residential Investment Corp.	1,678	20,304
New Senior Investment Group, Inc.	74,329	802,753
New York Mortgage Trust, Inc.	794	4,129
New York REIT, Inc.	1,141	11,216
NexPoint Residential Trust, Inc.	291	4,091
One Liberty Properties, Inc.	123	2,881
Orchid Island Capital, Inc.	512	4,956
Parkway Properties, Inc.	754	12,403
Pebblebrook Hotel Trust	760	21,006
Pennsylvania Real Estate Investment Trust	546	12,525
PennyMac Mortgage Investment Trust	319	4,335
Physicians Realty Trust	826	14,975
Potlatch Corp.	389	13,701
Preferred Apartment Communities, Inc., Class A	7	86
PS Business Parks, Inc.	150	14,364
QTS Realty Trust, Inc., Class A	371	17,964
RAIT Financial Trust	1,290	3,922
Ramco-Gershenson Properties Trust	919	16,275
RE/MAX Holdings, Inc., Class A	41	1,509
Redwood Trust, Inc.	597	7,737
Resource Capital Corp.	525	6,237
Retail Opportunity Investments Corp.	1,131	22,247
Rexford Industrial Realty, Inc.	761	14,284
RLJ Lodging Trust	1,194	25,158

See financial notes 25

Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Rouse Properties, Inc.	563	10,399
Ryman Hospitality Properties, Inc.	360	18,551
Sabra Health Care REIT, Inc.	485	10,229
Saul Centers, Inc.	143	7,605
Select Income REIT	454	10,510
Silver Bay Realty Trust Corp.	632	9,227
Sovran Self Storage, Inc.	326	34,628
STAG Industrial, Inc.	679	13,553
STORE Capital Corp.	403	10,345
Summit Hotel Properties, Inc.	123,797	1,411,286
Sun Communities, Inc.	430	29,184
Sunstone Hotel Investors, Inc.	2,160	27,670
Tejon Ranch Co. *	287	6,463
Terreno Realty Corp.	337	7,673
The Geo Group, Inc.	811	25,976
The RMR Group, Inc., Class A	13	324
The St. Joe Co. *	625	10,531
United Development Funding IV (d)(e)	84	215
Universal Health Realty Income Trust	106	5,788
Urban Edge Properties	647	16,783
Urstadt Biddle Properties, Inc., Class A	224	4,605
Washington Real Estate Investment Trust	487	13,962
Western Asset Mortgage Capital Corp.	535	5,334
Xenia Hotels & Resorts, Inc.	764	11,750
		6,354,870
Retailing 4.0%
Abercrombie & Fitch Co., Class A	648	17,321
America's Car-Mart, Inc. *	38	1,010
American Eagle Outfitters, Inc.	1,835	26,259
Asbury Automotive Group, Inc. *	265	16,064
Ascena Retail Group, Inc. *	97,456	858,587
Barnes & Noble Education, Inc. *	233	2,181
Barnes & Noble, Inc.	369	4,336
bebe stores, Inc.	766	431
Big 5 Sporting Goods Corp.	100	1,209
Big Lots, Inc.	445	20,408
Boot Barn Holdings, Inc. *	47	385
Build-A-Bear Workshop, Inc. *	61	803
Burlington Stores, Inc. *	16,123	918,527
Caleres, Inc.	203	5,118
Chico's FAS, Inc.	1,236	15,586
Christopher & Banks Corp. *	284	738
Citi Trends, Inc.	57	1,024
Conn's, Inc. *	257	3,531
Core-Mark Holding Co., Inc.	210	17,149
Destination XL Group, Inc. *	286	1,536
DSW, Inc., Class A	26,880	660,442
Etsy, Inc. *	101	887
EVINE Live, Inc. *	338	521
Express, Inc. *	689	12,526
Fenix Parts, Inc. *	66	333
Five Below, Inc. *	581	24,228
Francesca's Holdings Corp. *	635	10,541
Fred's, Inc., Class A	80,860	1,186,216
FTD Cos., Inc. *	208	5,784
Genesco, Inc. *	257	17,779
Group 1 Automotive, Inc.	214	14,090
Guess?, Inc.	518	9,505
Haverty Furniture Cos., Inc.	81	1,512

Security	Number of Shares	Value ($)
Hibbett Sports, Inc. *	194	7,003
HSN, Inc.	301	15,962
Kirkland's, Inc.	300	4,926
Lands' End, Inc. *	107	2,603
Liberty TripAdvisor Holdings, Inc., Class A *	695	15,332
Lithia Motors, Inc., Class A	219	18,181
Lumber Liquidators Holdings, Inc. *	272	4,056
MarineMax, Inc. *	149	2,832
Mattress Firm Holding Corp. *	92	3,590
Monro Muffler Brake, Inc.	307	21,251
Murphy USA, Inc. *	8,718	500,588
Nutrisystem, Inc.	331	7,289
Outerwall, Inc.	185	7,642
Overstock.com, Inc. *	183	2,670
Party City Holdco, Inc. *	69	989
Pier 1 Imports, Inc.	796	5,484
Pool Corp.	384	33,565
Rent-A-Center, Inc.	504	7,409
Restoration Hardware Holdings, Inc. *	274	11,856
Select Comfort Corp. *	569	14,043
Shoe Carnival, Inc.	70	1,794
Shutterfly, Inc. *	412	18,944
Sonic Automotive, Inc., Class A	510	9,568
Sportsman's Warehouse Holdings, Inc. *	124	1,411
Stage Stores, Inc.	61,250	450,800
Stein Mart, Inc.	490	3,548
Tailored Brands, Inc.	579	10,086
The Buckle, Inc.	280	8,103
The Cato Corp., Class A	30,946	1,132,314
The Children's Place, Inc.	180	14,024
The Container Store Group, Inc. *	102	724
The Finish Line, Inc., Class A	653	12,897
Tile Shop Holdings, Inc. *	190	3,390
Tilly's, Inc., Class A *	39	245
Tuesday Morning Corp. *	871	7,560
Vitamin Shoppe, Inc. *	264	7,226
VOXX International Corp. *	301	1,351
Wayfair, Inc., Class A *	51	1,925
West Marine, Inc. *	151	1,513
Weyco Group, Inc.	68	1,907
Winmark Corp.	26	2,475
Zumiez, Inc. *	104	1,745
		6,237,388
Semiconductors & Semiconductor Equipment 1.2%
Advanced Energy Industries, Inc. *	476	15,399
Advanced Micro Devices, Inc. *	3,892	13,817
Alpha & Omega Semiconductor Ltd. *	236	3,066
Ambarella, Inc. *	241	9,905
Amkor Technology, Inc. *	1,019	5,818
Applied Micro Circuits Corp. *	643	4,012
Axcelis Technologies, Inc. *	1,509	4,316
Brooks Automation, Inc.	169	1,599
Cabot Microelectronics Corp.	230	9,635
Cascade Microtech, Inc. *	91	1,903
Cavium, Inc. *	527	26,018
CEVA, Inc. *	286	6,595
Cirrus Logic, Inc. *	717	25,884
Cypress Semiconductor Corp.	79,837	720,928

26 See financial notes

Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Diodes, Inc. *	365	6,796
DSP Group, Inc. *	82	779
Entegris, Inc. *	1,156	15,363
Exar Corp. *	382	2,330
Fairchild Semiconductor International, Inc. *	1,286	25,720
FormFactor, Inc. *	826	6,360
Inphi Corp. *	440	13,055
Integrated Device Technology, Inc. *	1,416	27,300
Intersil Corp., Class A	1,086	12,695
Kopin Corp. *	1,298	2,155
Lattice Semiconductor Corp. *	821	4,573
M/A-COM Technology Solutions Holdings, Inc. *	107	4,375
Mattson Technology, Inc. *	426	1,555
MaxLinear, Inc., Class A *	584	9,782
Microsemi Corp. *	21,112	713,374
MKS Instruments, Inc.	463	16,603
Monolithic Power Systems, Inc.	349	21,785
Nanometrics, Inc. *	425	7,590
NeoPhotonics Corp. *	154	1,846
NVE Corp.	36	2,066
PDF Solutions, Inc. *	270	3,632
Photronics, Inc. *	598	6,327
Power Integrations, Inc.	321	15,488
Rambus, Inc. *	1,071	12,445
Rudolph Technologies, Inc. *	679	9,418
Semtech Corp. *	581	12,573
Sigma Designs, Inc. *	117	741
Silicon Laboratories, Inc. *	261	12,215
Synaptics, Inc. *	260	18,603
Tessera Technologies, Inc.	650	18,668
Ultra Clean Holdings, Inc. *	244	1,388
Ultratech, Inc. *	370	8,025
Veeco Instruments, Inc. *	397	7,309
Xcerra Corp. *	528	3,115
		1,874,944
Software & Services 11.6%
A10 Networks, Inc. *	548	3,272
ACI Worldwide, Inc. *	942	18,831
Actua Corp. *	85,013	805,923
Acxiom Corp. *	710	15,599
Amber Road, Inc. *	204	1,002
American Software, Inc., Class A	406	3,711
Angie's List, Inc. *	399	3,491
Apigee Corp. *	126	1,222
Aspen Technology, Inc. *	738	28,066
AVG Technologies N.V. *	417	8,257
Bankrate, Inc. *	531	4,853
Barracuda Networks, Inc. *	64	1,128
Bazaarvoice, Inc. *	700	2,345
Benefitfocus, Inc. *	40	1,516
Blackbaud, Inc.	445	27,488
Blackhawk Network Holdings, Inc. *	350	11,245
Blucora, Inc. *	369	2,956
Bottomline Technologies de, Inc. *	508	12,476
Box, Inc., Class A *	309	3,995
Brightcove, Inc. *	325	1,966
BroadSoft, Inc. *	281	11,005
CACI International, Inc., Class A *	246	23,653

Security	Number of Shares	Value ($)
Callidus Software, Inc. *	50,899	931,452
Cardtronics, Inc. *	23,477	925,463
Care.com, Inc. *	115	856
Cass Information Systems, Inc.	37	1,830
ChannelAdvisor Corp. *	195	2,430
Ciber, Inc. *	1,217	2,823
Cimpress N.V. *	301	26,449
Code Rebel Corp. *	46	130
CommVault Systems, Inc. *	474	20,747
comScore, Inc. *	427	13,075
Convergys Corp.	1,078	28,567
Cornerstone OnDemand, Inc. *	513	17,622
Criteo S.A. ADR *	30,422	1,268,293
CSG Systems International, Inc.	393	17,441
Cvent, Inc. *	139	4,914
Datalink Corp. *	156	1,253
Demandware, Inc. *	357	16,451
Digimarc Corp. *	61	1,821
Digital Turbine, Inc. *	435	374
EarthLink Holdings Corp.	954	5,543
Ebix, Inc.	202	9,720
Ellie Mae, Inc. *	273	22,823
Endurance International Group Holdings, Inc. *	263	2,817
EnerNOC, Inc. *	145	989
Envestnet, Inc. *	417	13,085
EPAM Systems, Inc. *	397	28,953
Epiq Systems, Inc.	423	6,248
Euronet Worldwide, Inc. *	460	35,466
Everi Holdings, Inc. *	597	1,003
EVERTEC, Inc.	473	6,371
Everyday Health, Inc. *	96	557
ExlService Holdings, Inc. *	339	16,404
Fair Isaac Corp.	286	30,519
Five9, Inc. *	264	2,442
Fleetmatics Group plc *	19,496	706,730
Forrester Research, Inc.	34,709	1,166,917
Gigamon, Inc. *	26,355	858,909
Globant S.A. *	47	1,668
Glu Mobile, Inc. *	236	630
Gogo, Inc. *	606	6,418
GrubHub, Inc. *	856	22,444
GTT Communications, Inc. *	179	2,860
Guidance Software, Inc. *	162	826
Guidewire Software, Inc. *	525	29,909
Hortonworks, Inc. *	269	3,112
HubSpot, Inc. *	7,668	339,616
Imperva, Inc. *	182	8,459
inContact, Inc. *	292,912	2,727,011
Infoblox, Inc. *	642	10,741
Interactive Intelligence Group, Inc. *	204	7,583
Internap Corp. *	720	1,642
Intralinks Holdings, Inc. *	665	5,925
j2 Global, Inc.	13,472	855,741
Jive Software, Inc. *	257	1,046
Limelight Networks, Inc. *	612	1,071
Liquidity Services, Inc. *	38	212
LivePerson, Inc. *	533	3,225
LogMeIn, Inc. *	16,596	990,781
Luxoft Holding, Inc. *	175	10,117
Manhattan Associates, Inc. *	619	37,474
ManTech International Corp., Class A	120	4,056

See financial notes 27

Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Marchex, Inc., Class B	207	880
Marin Software, Inc. *	241	617
Marketo, Inc. *	266	5,849
MAXIMUS, Inc.	17,311	915,752
MaxPoint Interactive, Inc. *	43	345
Mentor Graphics Corp.	965	19,261
MicroStrategy, Inc., Class A *	91	16,318
MobileIron, Inc. *	159	609
Model N, Inc. *	157	1,677
ModusLink Global Solutions, Inc. *	891	1,301
MoneyGram International, Inc. *	348	2,140
Monotype Imaging Holdings, Inc.	438	9,649
Monster Worldwide, Inc. *	705	2,256
NeuStar, Inc., Class A *	383	8,997
New Relic, Inc. *	43	1,109
NIC, Inc.	599	10,608
OPOWER, Inc. *	124	980
Park City Group, Inc. *	110	1,045
Paycom Software, Inc. *	128	4,891
Paylocity Holding Corp. *	41	1,569
Pegasystems, Inc.	464	12,245
Perficient, Inc. *	203	4,239
PFSweb, Inc. *	137	1,932
Progress Software Corp. *	307	7,835
Proofpoint, Inc. *	11,759	685,079
PROS Holdings, Inc. *	404	4,751
Q2 Holdings, Inc. *	116	2,774
QAD, Inc., Class A	148	2,902
Qlik Technologies, Inc. *	965	29,712
Qualys, Inc. *	152	3,827
QuinStreet, Inc. *	551	1,939
Quotient Technology, Inc. *	219	2,545
RealNetworks, Inc. *	144	657
RealPage, Inc. *	505	11,105
Reis, Inc.	91	2,290
RetailMeNot, Inc. *	473	3,987
RingCentral, Inc., Class A *	27,315	521,170
Rovi Corp. *	743	13,092
Sapiens International Corp. N.V.	293	3,452
Science Applications International Corp.	385	20,440
SciQuest, Inc. *	370	5,113
ServiceSource International, Inc. *	546	2,200
Shutterstock, Inc. *	143	5,866
Silver Spring Networks, Inc. *	299	4,201
SPS Commerce, Inc. *	166	8,454
Stamps.com, Inc. *	148	12,189
Sykes Enterprises, Inc. *	209	6,092
Synchronoss Technologies, Inc. *	298	9,259
Syntel, Inc. *	343	14,588
Take-Two Interactive Software, Inc. *	895	30,591
Tangoe, Inc. *	530	4,675
TeleTech Holdings, Inc.	251	6,975
Textura, Corp. *	171	4,513
The Hackett Group, Inc.	327	4,866
The Rubicon Project, Inc. *	103,976	2,014,015
TiVo, Inc. *	1,084	10,818
Travelport Worldwide Ltd.	904	12,611
Travelzoo, Inc. *	203	1,549
TrueCar, Inc. *	240	1,642
TubeMogul, Inc. *	94	1,218
Tyler Technologies, Inc. *	270	39,531

Security	Number of Shares	Value ($)
Unisys Corp. *	452	3,485
United Online, Inc. *	94	1,018
Varonis Systems, Inc. *	61	1,168
VASCO Data Security International, Inc. *	450	7,798
Verint Systems, Inc. *	551	18,646
VirnetX Holding Corp. *	369	1,657
Virtusa Corp. *	14,956	531,536
Web.com Group, Inc. *	553	11,054
WebMD Health Corp. *	11,510	722,137
Wix.com Ltd. *	132	3,263
Workiva, Inc. *	103	1,227
XO Group, Inc. *	322	5,686
Xura, Inc. *	58	1,299
Zendesk, Inc. *	452	10,215
Zix Corp. *	276	1,029
		18,128,064
Technology Hardware & Equipment 5.6%
ADTRAN, Inc.	723	13,968
Aerohive Networks, Inc. *	194	1,125
Agilysys, Inc. *	60	641
Anixter International, Inc. *	145	9,034
Applied Optoelectronics, Inc. *	218	2,442
Avid Technology, Inc. *	246	1,373
AVX Corp.	271	3,583
Badger Meter, Inc.	136	9,701
Bel Fuse, Inc., Class B	120	1,999
Belden, Inc.	32,957	2,080,905
Benchmark Electronics, Inc. *	697	13,536
Black Box Corp.	68	994
CalAmp Corp. *	504	7,545
Checkpoint Systems, Inc. *	312	3,157
Ciena Corp. *	1,201	20,213
Clearfield, Inc. *	106	1,967
Coherent, Inc. *	9,004	840,974
Comtech Telecommunications Corp.	298	7,212
Cray, Inc. *	348	13,179
CTS Corp.	37,264	617,464
Diebold, Inc.	38,610	1,014,285
Digi International, Inc. *	149	1,575
DTS, Inc. *	286	6,241
Eastman Kodak Co. *	83	981
Electro Rent Corp.	245	2,452
Electronics For Imaging, Inc. *	19,962	795,286
EMCORE Corp. *	102	581
ePlus, Inc. *	28	2,251
Extreme Networks, Inc. *	1,418	4,977
Fabrinet *	398	12,724
FARO Technologies, Inc. *	117	3,398
FEI Co.	318	28,308
Finisar Corp. *	1,090	17,941
GSI Group, Inc. *	370	5,384
Harmonic, Inc. *	590	2,041
II-VI, Inc. *	642	13,399
Imation Corp. *	340	534
Immersion Corp. *	265	1,937
Infinera Corp. *	1,368	16,266
Insight Enterprises, Inc. *	288	7,116
InterDigital, Inc.	404	23,020
InvenSense, Inc. *	918	7,050

28 See financial notes

Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Itron, Inc. *	319	13,117
Ixia *	521	5,273
Kimball Electronics, Inc. *	123	1,346
Knowles Corp. *	640	8,557
KVH Industries, Inc. *	129	1,259
Littelfuse, Inc.	217	25,276
Mesa Laboratories, Inc.	31	3,124
Methode Electronics, Inc.	309	9,187
MTS Systems Corp.	124	6,971
Multi-Fineline Electronix, Inc. *	162	3,726
NETGEAR, Inc. *	420	17,808
NetScout Systems, Inc. *	829	18,454
Newport Corp. *	604	13,886
Nimble Storage, Inc. *	269	1,985
Novatel Wireless, Inc. *	421	644
Oclaro, Inc. *	788	3,979
OSI Systems, Inc. *	196	9,974
PC Connection, Inc.	112	2,662
Plantronics, Inc.	231	8,882
Plexus Corp. *	274	11,442
Polycom, Inc. *	932	11,137
QLogic Corp. *	889	11,637
Quantum Corp. *	1,535	707
Rofin-Sinar Technologies, Inc. *	393	12,651
Rogers Corp. *	112	6,424
Ruckus Wireless, Inc. *	767	10,539
Sanmina Corp. *	875	20,694
ScanSource, Inc. *	35,296	1,435,841
ShoreTel, Inc. *	824	5,043
Silicon Graphics International Corp. *	69,469	311,221
Sonus Networks, Inc. *	638	5,270
Stratasys Ltd. *	449	10,987
Super Micro Computer, Inc. *	323	8,692
SYNNEX Corp.	257	21,220
Systemax, Inc. *	93	842
Tech Data Corp. *	259	17,791
TTM Technologies, Inc. *	704	4,590
Ubiquiti Networks, Inc. *	319	11,363
Universal Display Corp. *	351	20,467
VeriFone Systems, Inc. *	37,916	1,079,089
ViaSat, Inc. *	395	30,296
Violin Memory, Inc. *	593	209
Vishay Intertechnology, Inc.	890	10,822
Vishay Precision Group, Inc. *	109	1,631
		8,835,474
Telecommunication Services 1.0%
8x8, Inc. *	59,995	680,343
Atlantic Tele-Network, Inc.	34	2,445
Boingo Wireless, Inc. *	221	1,700
Cincinnati Bell, Inc. *	1,940	7,411
Cogent Communications Holdings, Inc.	13,720	530,964
Consolidated Communications Holdings, Inc.	434	10,260
FairPoint Communications, Inc. *	420	5,569
General Communication, Inc., Class A *	408	6,895
Globalstar, Inc. *	2,732	5,327
Hawaiian Telcom Holdco, Inc. *	69	1,589
Inteliquent, Inc.	375	6,221
Intelsat S.A. *	128	506
Iridium Communications, Inc. *	595	4,802

Security	Number of Shares	Value ($)
NTELOS Holdings Corp. *	715	6,614
ORBCOMM, Inc. *	200	1,982
pdvWireless, Inc. *	34	1,373
Shenandoah Telecommunications Co.	418	11,992
Spok Holdings, Inc.	257	4,366
Straight Path Communications, Inc., Class B *	44	1,610
Vonage Holdings Corp. *	65,396	305,399
Windstream Holdings, Inc.	1,095	9,505
		1,606,873
Transportation 0.5%
Air Transport Services Group, Inc. *	673	9,483
Allegiant Travel Co.	121	19,429
ArcBest Corp.	334	6,376
Atlas Air Worldwide Holdings, Inc. *	244	9,745
Celadon Group, Inc.	293	2,951
Covenant Transport Group, Inc., Class A *	55	1,095
Eagle Bulk Shipping, Inc. *	205	169
Echo Global Logistics, Inc. *	192	4,487
Forward Air Corp.	12,528	571,026
Golden Ocean Group Ltd. *	271	235
Hawaiian Holdings, Inc. *	485	20,404
Heartland Express, Inc.	480	8,693
Hub Group, Inc., Class A *	291	11,209
Knight Transportation, Inc.	622	16,527
Marten Transport Ltd.	113	2,109
Matson, Inc.	322	12,519
Navios Maritime Holdings, Inc.	675	790
P.A.M. Transportation Services, Inc. *	48	1,186
Park-Ohio Holdings Corp.	53	1,349
Radiant Logistics, Inc. *	95	374
Roadrunner Transportation Systems, Inc. *	377	4,456
Safe Bulkers, Inc.	243	301
Saia, Inc. *	93	2,690
Scorpio Bulkers, Inc. *	88	339
SkyWest, Inc.	188	4,418
Swift Transportation Co. *	1,069	17,767
Ultrapetrol Bahamas Ltd. *	1,100	307
Universal Truckload Services, Inc.	73	1,041
USA Truck, Inc. *	31	549
Virgin America, Inc. *	232	12,920
Werner Enterprises, Inc.	580	14,697
Wesco Aircraft Holdings, Inc. *	356	5,137
XPO Logistics, Inc. *	532	16,034
YRC Worldwide, Inc. *	350	3,220
		784,032
Utilities 2.0%
Abengoa Yield plc	439	7,915
ALLETE, Inc.	339	19,048
American States Water Co.	422	17,593
Artesian Resources Corp., Class A	252	6,802
Atlantic Power Corp.	1,045	2,780
Avista Corp.	543	21,758
Black Hills Corp.	544	32,961
California Water Service Group	286	7,988
Chesapeake Utilities Corp.	55	3,274

See financial notes 29

Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Connecticut Water Service, Inc.	59	2,774
Consolidated Water Co., Ltd.	113	1,570
Dynegy, Inc. *	1,305	23,007
El Paso Electric Co.	450	20,295
Genie Energy Ltd., Class B *	129	951
IDACORP, Inc.	518	37,674
MGE Energy, Inc.	265	13,210
Middlesex Water Co.	87	3,182
New Jersey Resources Corp.	17,390	620,475
Northwest Natural Gas Co.	301	15,514
NorthWestern Corp.	326	18,530
NRG Yield, Inc., Class A	350	5,296
NRG Yield, Inc., Class C	301	4,870
ONE Gas, Inc.	386	22,569
Ormat Technologies, Inc.	322	13,975
Otter Tail Corp.	409	11,828
Pattern Energy Group, Inc.	326	6,846
Piedmont Natural Gas Co., Inc.	781	46,704
PNM Resources, Inc.	614	19,452
Portland General Electric Co.	854	33,921
SJW Corp.	65	2,237
South Jersey Industries, Inc.	724	20,207
Southwest Gas Corp.	495	32,130
Spark Energy, Inc., Class A	99	2,552
Spire, Inc.	15,173	970,465
Talen Energy Corp. *	328	3,824
The Empire District Electric Co.	263	8,855
The York Water Co.	254	7,531
Vivint Solar, Inc. *	386	1,289
WGL Holdings, Inc.	14,930	1,013,598
		3,105,450
Total Common Stock
(Cost $140,075,201)		148,292,576

Other Investment Companies 5.3% of net assets
Equity Funds 1.4%
iShares Russell 2000 ETF	1,975	221,911
iShares Russell Mid-Cap ETF	12,180	2,004,585
		2,226,496
Money Market Fund 3.9%
State Street Institutional U.S. Government Money Market Fund, Premier Class 0.23% (c)	6,057,105	6,057,105
Total Other Investment Companies
(Cost $8,320,268)		8,283,601

Rights 0.0% of net assets
Banks 0.0%
Enterprise Bank & Trust *(d)(e)	99	11
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
Dyax Corp. CVR *(d)(e)	1,269	1,409

Security	Number of Shares	Value ($)
Telecommunication Services 0.0%
Leap Wireless CVR *(d)(e)	861	1,627
Total Rights
(Cost $3,578)		3,047

Warrants 0.0% of net assets
Energy 0.0%
Magnum Hunter Resources Corp. *(d)(e)	129	—
Total Warrants
(Cost $—)		—
Security Rate, Maturity Date	Face Amount ($)	Value ($)
Short-Term Investment 0.0% of net assets
U.S. Treasury Obligation 0.0%
U.S. Treasury Bill
0.33%, 06/23/16 (a)(b)	7,000	6,999
Total Short-Term Investment
(Cost $6,997)		6,999

End of Investments.

At 04/30/16, the tax basis cost of the fund's investments was $148,727,667 and the unrealized appreciation and depreciation were $21,680,898 and ($13,822,342), respectively, with a net appreciation of $7,858,556.

*	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 $3,262 or 0.0% 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 04/30/16:

	Number of Contracts	Contract Value ($)	Unrealized Appreciation ($)
Futures Contracts
Russell 2000 Index, mini, Long, expires 06/17/16	4	451,040	6,811

30 See financial notes

Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

The following is a summary of the inputs used to value the fund's investments as of April 30, 2016 (see financial note 2(a) for additional information):

Description	Quoted Prices in Active Markets for Identical Assets (Level 1)	Other Significant Observable Inputs (Level 2)	Significant Unobservable Inputs (Level 3)	Total
Common Stock¹	$141,937,706	$—	$—	$141,937,706
Real Estate	6,354,655	—	215	6,354,870
Other Investment Companies¹	8,283,601	—	—	8,283,601
Rights ¹	—	—	3,047	3,047
Warrants ¹	—	—	—	—
Short-Term Investment¹	—	6,999	—	6,999
Total	$156,575,962	$6,999	$3,262	$156,586,223
Other Financial Instruments
Futures Contracts²	$6,811	$—	$—	$6,811

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.

In the above table for significant unobservable inputs (Level 3), amounts include investments determined to have no value at April 30, 2016. See the Portfolio Holdings footnote (Fair-valued by management in accordance with procedures approved by the Board of Trustees) for investment details.

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

Investments in Securities	Balance as of October 31, 2015	Realized Gains (Losses)	Change in Unrealized Appreciation (Depreciation)	Gross Purchases	Gross Sales	Gross Transfers in	Gross Transfers out	Balance as of April 30, 2016
Common Stock	$456	($1,371)	($267)	$—	($48)	$1,445	$—	$215
Rights	2,814	15	(531)	1,409	(660)	—	—	3,047
Total	$3,270	($1,356)	($798)	$1,409	($708)	$1,445	$—	$3,262

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 out of Level 1 to Level 3 due to the result of fair valued securities for which no quoted value was available. There were no transfers between Level 1 and Level 2 for the period ended April 30, 2016.

See financial notes 31

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
	11/1/15-4/30/16		11/1/14-10/31/15
Net investment income (loss)		$153,546	($279,682)
Net realized gains (losses)		(4,071,518)	11,585,861
Net change in unrealized appreciation (depreciation)	+	135,421	(10,711,106)
Increase (decrease) in net assets from operations		(3,782,551)	595,073
Distributions from net investment income
Investor Shares		—	(112,615)
Select Shares	+	—	(400,670)
Total distributions from net investment income		—	(513,285)
Distributions from net realized gains
Investor Shares		(3,793,537)	(1,348,302)
Select Shares	+	(6,231,390)	(2,370,239)
Total distributions from net realized gains		(10,024,927)	(3,718,541)
Total distributions		($10,024,927)	($4,231,826)

Transactions in Fund Shares
		11/1/15-4/30/16		11/1/14-10/31/15
		SHARES	VALUE	SHARES	VALUE
Shares Sold
Investor Shares		26,442	$444,408	83,739	$1,529,010
Select Shares	+	258,464	4,103,843	1,188,034	21,470,184
Total shares sold		284,906	$4,548,251	1,271,773	$22,999,194
Shares Reinvested
Investor Shares		212,542	$3,368,785	76,269	$1,302,677
Select Shares	+	378,685	6,115,760	156,402	2,715,136
Total shares reinvested		591,227	$9,484,545	232,671	$4,017,813
Shares Redeemed
Investor Shares		(243,761)	($3,767,350)	(498,439)	($9,134,342)
Select Shares	+	(533,696)	(8,808,697)	(1,995,617)	(38,009,762)
Total shares redeemed		(777,457)	($12,576,047)	(2,494,056)	($47,144,104)
Net transactions in fund shares		98,676	$1,456,749	(989,612)	($20,127,097)
Shares Outstanding and Net Assets
		11/1/15-4/30/16		11/1/14-10/31/15
		SHARES	NET ASSETS	SHARES	NET ASSETS
Beginning of period		9,584,268	$168,817,357	10,573,880	$192,581,207
Total increase or decrease	+	98,676	(12,350,729)	(989,612)	(23,763,850)
End of period		9,682,944	$156,466,628	9,584,268	$168,817,357
Net investment income not yet distributed/Distributions in excess of net investment income			$149,026		($4,520)

34 See financial notes

Laudus International MarketMasters Fund

Financial Statements

Financial Highlights

Investor Shares	11/1/15– 4/30/16*	11/1/14– 10/31/15	11/1/13– 10/31/14	11/1/12– 10/31/13	11/1/11– 10/31/12	11/1/10– 10/31/11
Per-Share Data
Net asset value at beginning of period	$22.71	$22.95	$23.68	$19.03	$17.45	$18.36
Income (loss) from investment operations:
Net investment income (loss)	0.04 ¹	0.18 ¹	0.25	0.23	0.21	0.16
Net realized and unrealized gains (losses)	(0.58)	(0.10)	(0.66)	4.85	1.52	(0.85)
Total from investment operations	(0.54)	0.08	(0.41)	5.08	1.73	(0.69)
Less distributions:
Distributions from net investment income	(0.27)	(0.32)	(0.32)	(0.43)	(0.15)	(0.22)
Distributions from net realized gains	(1.20)	—	—	—	—	—
Total distributions	(1.47)	(0.32)	(0.32)	(0.43)	(0.15)	(0.22)
Net asset value at end of period	$20.70	$22.71	$22.95	$23.68	$19.03	$17.45
Total return	(2.36%) ²	0.39%	(1.73%)	27.23%	10.05%	(3.87%)
Ratios/Supplemental Data
Ratios to average net assets:
Net operating expenses	1.40% ³	1.40%	1.40%	1.40%	1.53% ⁴	1.59%
Gross operating expenses	1.60% ³	1.59%	1.59%	1.60%	1.62%	1.60%
Net investment income (loss)	0.38% ³	0.76%	1.06%	1.10%	1.19%	0.80%
Portfolio turnover rate	35% ²	72%	74%	65%	68%	78%
Net assets, end of period (x 1,000,000)	$480	$536	$631	$675	$592	$665

Select Shares	11/1/15– 4/30/16*	11/1/14– 10/31/15	11/1/13– 10/31/14	11/1/12– 10/31/13	11/1/11– 10/31/12	11/1/10– 10/31/11
Per-Share Data
Net asset value at beginning of period	$22.71	$22.95	$23.68	$19.03	$17.46	$18.38
Income (loss) from investment operations:
Net investment income (loss)	0.05 ¹	0.21 ¹	0.28	0.28	0.25	0.19
Net realized and unrealized gains (losses)	(0.58)	(0.10)	(0.65)	4.83	1.50	(0.86)
Total from investment operations	(0.53)	0.11	(0.37)	5.11	1.75	(0.67)
Less distributions:
Distributions from net investment income	(0.31)	(0.35)	(0.36)	(0.46)	(0.18)	(0.25)
Distributions from net realized gains	(1.20)	—	—	—	—	—
Total distributions	(1.51)	(0.35)	(0.36)	(0.46)	(0.18)	(0.25)
Net asset value at end of period	$20.67	$22.71	$22.95	$23.68	$19.03	$17.46
Total return	(2.32%) ²	0.56%	(1.57%)	27.43%	10.20%	(3.76%)
Ratios/Supplemental Data
Ratios to average net assets:
Net operating expenses	1.25% ³	1.25%	1.25%	1.25%	1.37% ⁴	1.45%
Gross operating expenses	1.54% ³	1.50%	1.47%	1.44%	1.47%	1.47%
Net investment income (loss)	0.51% ³	0.91%	1.20%	1.26%	1.40%	0.99%
Portfolio turnover rate	35% ²	72%	74%	65%	68%	78%
Net assets, end of period (x 1,000,000)	$1,137	$1,395	$1,592	$1,590	$1,062	$961

*	Unaudited.

Calculated based on the average shares outstanding during the period.

Not annualized.

Annualized (except for proxy costs).

⁴

Effective June 6, 2012, the net operating expense limitation was lowered. The ratio presented for period ended 10/31/12 is a blended ratio.

See financial notes 35

Laudus International MarketMasters Fund

Portfolio Holdings as of April 30, 2016 (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 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 fund also makes available its complete schedule of portfolio holdings 15-20 days after calendar quarters on the fund's website at www.csimfunds.com/laudusfunds_prospectus.

Holdings by Category		Cost ($)	Value ($)
96.0%	Common Stock	1,468,612,029	1,552,858,236
0.6%	Preferred Stock	8,110,129	9,325,980
2.9%	Other Investment Company	46,600,332	46,600,332
0.0%	Short-Term Investments	40,981	40,992
99.5%	Total Investments	1,523,363,471	1,608,825,540
0.5%	Other Assets and Liabilities, Net		7,720,556
100.0%	Net Assets		1,616,546,096

Security	Number of Shares	Value ($)
Common Stock 96.0% of net assets
Australia 5.6%
Banks 0.1%
Australia & New Zealand Banking Group Ltd.	14,301	262,136
Bank of Queensland Ltd.	1,719	14,618
Bendigo & Adelaide Bank Ltd.	2,110	14,854
Commonwealth Bank of Australia	8,395	468,668
National Australia Bank Ltd.	12,917	265,005
Westpac Banking Corp.	16,340	383,558
		1,408,839
Capital Goods 0.0%
CIMIC Group Ltd.	474	12,820
Commercial & Professional Supplies 0.1%
Brambles Ltd.	7,790	73,578
SEEK Ltd.	1,514	18,736
Spotless Group Holdings Ltd.	2,087,919	2,046,352
		2,138,666
Consumer Services 1.0%
Aristocrat Leisure Ltd.	732,995	5,541,174
Crown Resorts Ltd.	1,727	15,412
Domino's Pizza Enterprises Ltd.	65,790	3,081,374
Flight Centre Travel Group Ltd.	18,027	536,764
InvoCare Ltd.	697,321	6,473,756
Tabcorp Holdings Ltd.	4,951	16,607
Tatts Group Ltd.	6,840	19,491
		15,684,578

Security	Number of Shares	Value ($)
Diversified Financials 0.2%
ASX Ltd.	944	31,248
Challenger Ltd.	2,636	17,831
Macquarie Group Ltd.	48,779	2,336,755
Platinum Asset Management Ltd.	1,696	7,776
		2,393,610
Energy 0.0%
Caltex Australia Ltd.	1,305	32,029
Origin Energy Ltd.	8,502	34,939
Santos Ltd.	8,334	30,023
Woodside Petroleum Ltd.	3,616	77,419
		174,410
Food & Staples Retailing 0.0%
Wesfarmers Ltd.	5,542	179,454
Woolworths Ltd.	6,263	104,804
		284,258
Food, Beverage & Tobacco 0.3%
Coca-Cola Amatil Ltd.	2,792	18,190
Costa Group Holdings Ltd.	2,127,264	4,784,020
Treasury Wine Estates Ltd.	3,693	26,003
		4,828,213
Health Care Equipment & Services 0.0%
Cochlear Ltd.	266	21,758
Healthscope Ltd.	7,829	16,124
Ramsay Health Care Ltd.	683	33,587
Sonic Healthcare Ltd.	1,949	28,600
		100,069
Insurance 0.3%
AMP Ltd.	1,063,452	4,725,454
Insurance Australia Group Ltd.	12,017	52,366
Medibank Pvt Ltd.	13,744	32,709
QBE Insurance Group Ltd.	6,676	56,189
Suncorp Group Ltd.	6,273	59,331
		4,926,049
Materials 1.8%
Alumina Ltd.	12,671	14,308
Amcor Ltd.	5,752	67,062
BHP Billiton Ltd.	15,801	246,763
BlueScope Steel Ltd.	879,110	4,292,119
Boral Ltd.	3,516	17,113
Fortescue Metals Group Ltd.	7,891	20,280
Iluka Resources Ltd.	2,047	9,935
Incitec Pivot Ltd.	8,219	19,973
James Hardie Industries plc CDI	61,447	859,518
Newcrest Mining Ltd. *	3,788	55,235
Northern Star Resources Ltd.	1,445,920	4,300,592
Orica Ltd.	516,360	5,966,319
Pact Group Holdings Ltd.	1,566,100	6,134,508
Regis Resources Ltd.	1,663,280	3,699,237
Rio Tinto Ltd.	86,409	3,371,548
South32 Ltd. *	26,121	32,668
		29,107,178
Media 0.3%
APN Outdoor Group Ltd.	880,390	4,207,895
REA Group Ltd.	247	9,503
		4,217,398
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
CSL Ltd.	2,288	182,327

36 See financial notes

Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Real Estate 1.2%
Charter Hall Retail REIT	2,427,746	8,753,179
Dexus Property Group	4,734	30,185
Goodman Group	8,755	45,612
LendLease Group	112,598	1,081,579
Mirvac Group	18,047	25,534
Scentre Group	26,245	93,157
Shopping Centres Australasia Property Group	5,055,657	8,961,007
Stockland	11,487	37,993
The GPT Group	8,667	33,008
Vicinity Centres	228,620	574,657
Westfield Corp.	9,626	73,520
		19,709,431
Retailing 0.3%
Burson Group Ltd.	1,165,440	4,395,613
Harvey Norman Holdings Ltd.	2,277	7,711
JB Hi-Fi Ltd.	28,009	465,965
		4,869,289
Software & Services 0.0%
Computershare Ltd.	2,198	16,825
Telecommunication Services 0.0%
Telstra Corp., Ltd.	20,864	84,715
TPG Telecom Ltd.	1,490	12,077
Vocus Communications Ltd.	2,203	14,388
		111,180
Transportation 0.0%
Asciano Ltd.	3,091	20,722
Aurizon Holdings Ltd.	10,347	33,429
Qantas Airways Ltd. *	2,388	5,822
Sydney Airport	5,278	27,214
Transurban Group	9,892	86,800
		173,987
Utilities 0.0%
AGL Energy Ltd.	3,336	46,208
APA Group	5,384	35,660
AusNet Services	8,703	10,125
DUET Group	10,516	17,967
		109,960
		90,449,087
Austria 0.0%
Banks 0.0%
Erste Group Bank AG *	1,350	38,861
Raiffeisen Bank International AG *	670	10,725
		49,586
Capital Goods 0.0%
ANDRITZ AG	371	20,825
Energy 0.0%
OMV AG	712	21,424
Materials 0.0%
voestalpine AG	554	19,991
		111,826

Security	Number of Shares	Value ($)
Belgium 0.3%
Banks 0.2%
KBC Groep N.V.	46,018	2,589,066
Diversified Financials 0.0%
Groupe Bruxelles Lambert S.A.	390	34,505
Food & Staples Retailing 0.0%
Colruyt S.A.	341	19,662
Delhaize Group	506	53,173
		72,835
Food, Beverage & Tobacco 0.0%
Anheuser-Busch InBev N.V.	3,953	490,385
Insurance 0.0%
Ageas	973	38,236
Materials 0.0%
Solvay S.A.	358	36,269
Umicore S.A.	486	24,261
		60,530
Media 0.1%
Telenet Group Holding N.V. *	26,638	1,326,078
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
UCB S.A.	616	46,206
Telecommunication Services 0.0%
Proximus	735	24,772
		4,682,613
Brazil 0.7%
Food, Beverage & Tobacco 0.2%
Ambev S.A. ADR	628,691	3,514,383
Insurance 0.1%
BB Seguridade Participacoes S.A.	168,600	1,470,669
Media 0.2%
Smiles S.A.	272,700	3,163,693
Real Estate 0.2%
Iguatemi Empresa de Shopping Centers S.A.	449,600	3,490,389
		11,639,134
Canada 4.6%
Banks 0.3%
The Toronto-Dominion Bank	121,843	5,423,553
Capital Goods 1.0%
Aecon Group, Inc.	239,450	3,192,794
CAE, Inc.	922,990	10,916,690
New Flyer Industries, Inc.	75,030	2,210,775
		16,320,259
Commercial & Professional Supplies 0.2%
Ritchie Bros. Auctioneers, Inc.	136,011	3,902,444
Energy 1.3%
Canadian Natural Resources Ltd.	82,976	2,491,859
Enbridge, Inc.	94,688	3,933,321
Parex Resources, Inc. *	467,600	4,684,572
Raging River Exploration, Inc. *	659,160	5,342,837
Suncor Energy, Inc.	116,535	3,420,725
TORC Oil & Gas Ltd.	152,060	1,025,287
		20,898,601

See financial notes 37

Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Food & Staples Retailing 0.1%
Alimentation Couche-Tard, Inc., Class B	25,073	1,099,080
Insurance 0.1%
Intact Financial Corp.	15,047	1,113,504
Materials 0.3%
CCL Industries, Inc., Class B	12,130	2,221,143
Norbord, Inc.	184,660	3,680,837
		5,901,980
Real Estate 0.7%
Brookfield Asset Management, Inc., Class A	86,922	2,939,702
FirstService Corp.	105,770	4,752,779
Northview Apartment Real Estate Investment Trust	217,100	3,405,219
		11,097,700
Retailing 0.1%
Dollarama, Inc.	20,486	1,476,977
Software & Services 0.5%
Constellation Software, Inc.	1,483	579,560
Shopify, Inc., Class A *	101,750	3,240,738
The Descartes Systems Group, Inc. *	219,600	4,048,257
		7,868,555
		75,102,653
China 2.6%
Automobiles & Components 0.5%
Nexteer Automotive Group Ltd.	7,989,050	8,410,338
Consumer Durables & Apparel 0.1%
Cosmo Lady China Holdings Co., Ltd. (e)	2,871,000	2,228,198
Consumer Services 0.2%
China Maple Leaf Educational Systems Ltd.	4,564,000	3,612,558
Health Care Equipment & Services 0.0%
Microport Scientific Corp. *	194,000	100,832
Insurance 0.1%
PICC Property & Casualty Co	170,000	309,243
Ping An Insurance (Group) Co. of China Ltd., Class H	372,500	1,748,172
		2,057,415
Real Estate 0.2%
China Overseas Land & Investment Ltd.	502,000	1,593,481
China Resources Land Ltd.	396,000	972,849
		2,566,330
Software & Services 1.2%
Alibaba Group Holding Ltd. ADR *	14,181	1,091,086
Baidu, Inc. ADR *	43,341	8,421,156
Bitauto Holdings Ltd. *	183,490	4,579,911
NetEase, Inc. ADR	12,695	1,786,187
Tencent Holdings Ltd.	128,900	2,622,897
		18,501,237

Security	Number of Shares	Value ($)
Utilities 0.3%
CT Environmental Group Ltd.	14,450,000	4,214,732
ENN Energy Holdings Ltd.	176,000	858,464
		5,073,196
		42,550,104
Denmark 1.4%
Banks 0.0%
Danske Bank A/S	3,480	98,465
Capital Goods 0.1%
Vestas Wind Systems A/S	24,793	1,774,734
Commercial & Professional Supplies 0.1%
ISS A/S	35,474	1,347,466
Consumer Durables & Apparel 0.1%
Pandora A/S	13,281	1,726,696
Food, Beverage & Tobacco 0.0%
Carlsberg A/S, Class B	529	51,568
Health Care Equipment & Services 0.1%
Coloplast A/S, Class B	17,113	1,282,029
William Demant Holding A/S *	115	11,825
		1,293,854
Insurance 0.0%
Tryg A/S	544	10,279
Materials 0.7%
Chr. Hansen Holding A/S	186,569	11,617,847
Novozymes A/S, B Shares	1,138	54,581
		11,672,428
Pharmaceuticals, Biotechnology & Life Sciences 0.2%
Genmab A/S *	267	39,615
Novo Nordisk A/S, Class B	61,818	3,451,568
		3,491,183
Telecommunication Services 0.0%
TDC A/S	3,779	19,350
Transportation 0.1%
AP Moeller - Maersk A/S, Series A	19	25,886
AP Moeller - Maersk A/S, Series B	34	47,855
DSV A/S	24,630	1,036,877
		1,110,618
		22,596,641
Finland 0.5%
Automobiles & Components 0.0%
Nokian Renkaat Oyj	533	19,687
Capital Goods 0.3%
Cramo Oyj	68,510	1,372,850
Kone Oyj, Class B	77,705	3,550,527
Metso Oyj	567	13,657
Wartsila Oyj Abp	715	30,686
		4,967,720
Energy 0.0%
Neste Oyj	619	19,836
Insurance 0.1%
Sampo Oyj, A Shares	47,808	2,091,173

38 See financial notes

Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Materials 0.0%
Stora Enso Oyj, R Shares	2,686	23,484
UPM-Kymmene Oyj	2,640	50,535
		74,019
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
Orion Oyj, Class B	512	17,881
Technology Hardware & Equipment 0.0%
Nokia Oyj	28,396	167,636
Telecommunication Services 0.1%
Elisa Oyj	19,073	713,177
Utilities 0.0%
Fortum Oyj	2,146	32,354
		8,103,483
France 9.4%
Automobiles & Components 0.8%
Compagnie Generale des Etablissements Michelin	920	96,094
Peugeot S.A. *	2,203	35,504
Plastic Omnium S.A.	162,843	5,396,103
Renault S.A.	947	91,374
Valeo S.A.	50,411	7,996,140
		13,615,215
Banks 1.0%
BNP Paribas S.A.	294,346	15,588,251
Credit Agricole S.A.	5,147	56,971
Natixis S.A.	4,534	25,018
Societe Generale S.A.	3,573	140,588
		15,810,828
Capital Goods 1.2%
Airbus Group SE	2,909	181,864
Alstom S.A. *	787	20,124
Bouygues S.A.	979	32,668
Compagnie de Saint-Gobain	2,377	108,920
Legrand S.A.	1,316	75,009
LISI (f)	158,464	4,534,417
Rexel S.A.	1,404	21,288
Safran S.A.	109,736	7,565,160
Schneider Electric SE	2,748	179,685
Thales S.A.	23,562	2,039,001
Vinci S.A.	68,684	5,129,891
Zodiac Aerospace	975	22,875
		19,910,902
Commercial & Professional Supplies 0.8%
Bureau Veritas S.A.	232,681	5,515,291
Edenred	1,037	20,455
Societe BIC S.A.	139	19,736
Teleperformance	80,400	7,221,700
		12,777,182
Consumer Durables & Apparel 1.0%
Christian Dior SE	8,925	1,568,303
Hermes International	3,019	1,075,238
Kering	42,959	7,367,382
LVMH Moet Hennessy Louis Vuitton SE	29,822	4,968,689
SEB S.A.	4,891	547,961
		15,527,573

Security	Number of Shares	Value ($)
Consumer Services 0.1%
Accor S.A.	1,057	46,807
Sodexo S.A.	15,315	1,547,177
		1,593,984
Diversified Financials 0.0%
Eurazeo S.A.	197	13,872
Wendel S.A.	140	16,179
		30,051
Energy 0.5%
Technip S.A.	511	29,950
TOTAL S.A.	143,534	7,254,322
		7,284,272
Food & Staples Retailing 0.0%
Carrefour S.A.	2,701	76,522
Casino Guichard Perrachon S.A.	280	16,664
		93,186
Food, Beverage & Tobacco 0.5%
Danone S.A.	56,999	3,993,544
Pernod-Ricard S.A.	30,346	3,277,821
Remy Cointreau S.A.	159	13,221
		7,284,586
Health Care Equipment & Services 0.5%
Essilor International S.A.	11,633	1,505,961
Korian S.A.	182,107	5,739,036
Orpea	6,594	543,999
		7,788,996
Household & Personal Products 0.0%
L'Oreal S.A.	1,240	225,241
Insurance 0.2%
AXA S.A.	153,740	3,881,874
CNP Assurances	829	14,126
SCOR SE	742	25,277
		3,921,277
Materials 0.0%
Air Liquide S.A.	1,694	192,128
Arkema S.A.	326	26,020
Imerys S.A.	170	12,554
		230,702
Media 0.0%
Eutelsat Communications S.A.	822	25,538
JC Decaux S.A.	359	15,907
Lagardere S.C.A.	592	15,710
Publicis Groupe S.A.	921	68,157
SES S.A.	1,614	44,096
Technicolor S.A. - Reg'd	63,657	436,640
Vivendi S.A.	5,726	109,998
		716,046
Pharmaceuticals, Biotechnology & Life Sciences 0.6%
Boiron S.A. (f)	50,506	4,048,234
Eurofins Scientific SE	15,981	5,929,363
Sanofi	5,776	476,096
		10,453,693
Real Estate 0.5%
Fonciere Des Regions	142	13,434
Gecina S.A.	168	24,278
ICADE	157	12,352

See financial notes 39

Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Klepierre	1,087	51,124
Nexity S.A.	149,020	7,987,620
		8,088,808
Semiconductors & Semiconductor Equipment 0.0%
STMicroelectronics N.V.	3,108	19,109
Software & Services 0.5%
Atos SE	434	38,629
Cap Gemini S.A.	28,543	2,664,281
Dassault Systemes S.A.	640	50,058
Worldline S.A. *(e)	161,410	4,525,964
		7,278,932
Technology Hardware & Equipment 0.3%
Ingenico Group S.A.	38,632	4,553,851
Telecommunication Services 0.0%
Iliad S.A.	127	27,770
Numericable-SFR S.A.	529	17,332
Orange S.A.	9,779	162,467
		207,569
Transportation 0.0%
Aeroports de Paris	143	17,999
Bollore S.A.	4,193	16,605
Groupe Eurotunnel SE - Reg'd	2,280	29,111
		63,715
Utilities 0.9%
Electricite de France S.A.	1,168	16,780
Engie S.A.	7,198	118,720
Rubis S.C.A.	157,812	12,328,138
Suez Environnement Co.	1,438	26,502
Veolia Environnement S.A.	86,006	2,112,785
		14,602,925
		152,078,643
Germany 7.1%
Automobiles & Components 1.9%
Bayerische Motoren Werke AG	98,930	9,152,366
Continental AG	17,172	3,781,505
Daimler AG - Reg'd	166,335	11,589,664
ElringKlinger AG	220,990	5,425,053
Volkswagen AG	171	27,308
		29,975,896
Banks 0.0%
Commerzbank AG	5,191	48,678
Capital Goods 2.5%
Brenntag AG	24,164	1,419,359
Duerr AG	113,974	9,145,144
GEA Group AG	884	41,079
MAN SE	170	18,452
MTU Aero Engines AG	98,614	9,323,640
Norma Group SE	165,316	8,535,692
OSRAM Licht AG	455	23,760
Rational AG	7,817	3,972,606
Siemens AG - Reg'd	3,899	408,023
Stabilus S.A. *(f)	137,367	6,866,461
		39,754,216

Security	Number of Shares	Value ($)
Consumer Durables & Apparel 0.0%
adidas AG	1,031	133,017
Hugo Boss AG	326	20,804
		153,821
Diversified Financials 0.2%
Aurelius SE & Co. KGaA	39,550	2,367,260
Deutsche Bank AG - Reg'd	6,794	128,766
Deutsche Boerse AG	941	77,433
		2,573,459
Food & Staples Retailing 0.0%
METRO AG	861	27,469
Health Care Equipment & Services 0.0%
Fresenius Medical Care AG & Co. KGaA	1,077	93,739
Fresenius SE & Co. KGaA	1,879	137,013
		230,752
Household & Personal Products 0.0%
Beiersdorf AG	498	44,718
Henkel AG & Co. KGaA	514	52,287
		97,005
Insurance 0.7%
Allianz SE - Reg'd	63,107	10,736,259
Hannover Rueck SE	291	33,267
Muenchener Rueckversicherungs-Gesellschaft AG - Reg'd	821	152,629
		10,922,155
Materials 0.1%
BASF SE	4,517	373,695
Evonik Industries AG	21,898	694,785
HeidelbergCement AG	687	61,171
K&S AG - Reg'd	933	23,288
LANXESS AG	456	23,881
Linde AG	915	139,997
Symrise AG	596	39,557
ThyssenKrupp AG	1,820	42,409
		1,398,783
Media 0.5%
Axel Springer SE	220	12,302
CTS Eventim AG & Co. KGaA	31,140	1,092,855
ProSiebenSat.1 Media SE	54,036	2,760,429
RTL Group S.A. *	187	15,657
Stroeer SE & Co. KGaA	96,529	4,761,888
		8,643,131
Pharmaceuticals, Biotechnology & Life Sciences 0.3%
Bayer AG - Reg'd	4,066	469,895
Gerresheimer AG	6,512	485,675
Merck KGaA	630	59,331
QIAGEN N.V. *	137,538	3,093,316
		4,108,217
Real Estate 0.1%
Deutsche Wohnen AG	28,373	869,969
Vonovia SE	26,237	884,400
		1,754,369

40 See financial notes

Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Retailing 0.4%
Fielmann AG	91,487	6,760,131
Zalando SE *(e)	417	13,842
		6,773,973
Semiconductors & Semiconductor Equipment 0.1%
Dialog Semiconductor plc *	60,090	2,095,727
Infineon Technologies AG	5,506	78,557
		2,174,284
Software & Services 0.2%
SAP SE	42,009	3,296,069
United Internet AG - Reg'd	594	29,033
		3,325,102
Telecommunication Services 0.1%
Deutsche Telekom AG - Reg'd	108,771	1,909,304
Telefonica Deutschland Holding AG	3,571	18,169
		1,927,473
Transportation 0.0%
Deutsche Lufthansa AG - Reg'd	1,118	17,407
Deutsche Post AG - Reg'd	4,771	140,140
Fraport AG Frankfurt Airport Services Worldwide	196	11,882
		169,429
Utilities 0.0%
E.ON SE	9,862	102,211
RWE AG *	2,365	35,434
		137,645
		114,195,857
Hong Kong 2.2%
Banks 0.0%
BOC Hong Kong (Holdings) Ltd.	18,000	53,764
Hang Seng Bank Ltd.	3,800	68,896
The Bank of East Asia Ltd.	5,800	21,043
		143,703
Capital Goods 0.2%
CK Hutchison Holdings Ltd.	13,538	161,963
Haitian International Holdings Ltd.	1,305,000	2,226,542
NWS Holdings Ltd.	7,000	10,633
		2,399,138
Consumer Durables & Apparel 0.3%
Li & Fung Ltd.	28,000	17,317
Regina Miracle International Holdings Ltd. *(e)	2,143,000	3,251,636
Techtronic Industries Co., Ltd.	417,000	1,563,195
Yue Yuen Industrial Holdings Ltd.	3,500	12,748
		4,844,896
Consumer Services 0.5%
Galaxy Entertainment Group Ltd.	12,000	40,335
Melco Crown Entertainment Ltd. ADR	333,856	4,941,069
Melco International Development Ltd.	3,137,000	3,585,010
MGM China Holdings Ltd.	5,200	7,285
Sands China Ltd.	12,000	42,752
Shangri-La Asia Ltd.	8,000	9,773

Security	Number of Shares	Value ($)
SJM Holdings Ltd.	8,683	5,822
Wynn Macau Ltd.	8,000	11,375
		8,643,421
Diversified Financials 0.0%
First Pacific Co., Ltd.	10,000	6,333
Hong Kong Exchanges & Clearing Ltd.	5,700	143,681
		150,014
Food, Beverage & Tobacco 0.0%
WH Group Ltd. *(e)	28,500	23,020
Insurance 0.3%
AIA Group Ltd.	712,400	4,263,429
Real Estate 0.0%
Cheung Kong Property Holdings Ltd.	13,538	92,458
Hang Lung Properties Ltd.	11,000	21,903
Henderson Land Development Co., Ltd.	6,123	38,162
Hongkong Land Holdings Ltd.	2,900	18,371
Hysan Development Co., Ltd.	3,000	13,255
Kerry Properties Ltd.	3,000	8,152
Link REIT	11,000	66,736
New World Development Co., Ltd.	26,000	25,857
Sino Land Co., Ltd.	16,000	25,119
Sun Hung Kai Properties Ltd.	8,702	109,672
Swire Pacific Ltd., Class A	3,000	32,546
Swire Properties Ltd.	5,600	14,541
The Wharf Holdings Ltd.	6,349	34,316
Wheelock & Co., Ltd.	5,000	23,148
		524,236
Semiconductors & Semiconductor Equipment 0.1%
ASM Pacific Technology Ltd.	189,000	1,361,959
Technology Hardware & Equipment 0.5%
AAC Technologies Holdings, Inc.	512,500	3,557,245
China High Precision Automation Group Ltd. *(a)(f)	766,000	—
Sunny Optical Technology Group Co., Ltd.	1,397,000	4,308,704
		7,865,949
Telecommunication Services 0.3%
HKBN Ltd.	3,456,983	4,250,985
HKT Trust & HKT Ltd.	13,120	19,011
PCCW Ltd.	21,000	14,215
		4,284,211
Transportation 0.0%
Cathay Pacific Airways Ltd.	6,000	9,566
MTR Corp., Ltd.	7,500	37,079
		46,645
Utilities 0.0%
Cheung Kong Infrastructure Holdings Ltd.	3,574	33,729
CLP Holdings Ltd.	9,500	87,828
HK Electric Investments & HK Electric Investments Ltd.	13,000	11,690
Hong Kong & China Gas Co., Ltd.	34,643	64,487
Power Assets Holdings Ltd.	7,000	66,599
		264,333
		34,814,954

See financial notes 41

Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
India 0.7%
Automobiles & Components 0.1%
Maruti Suzuki India Ltd.	14,188	809,829
Banks 0.5%
Axis Bank Ltd.	164,693	1,170,365
HDFC Bank Ltd.	87,811	1,491,811
Housing Development Finance Corp., Ltd.	52,418	858,984
Indiabulls Housing Finance Ltd.	347,730	3,624,898
Yes Bank Ltd.	76,596	1,085,763
		8,231,821
Capital Goods 0.0%
Eicher Motors Ltd.	1,675	504,859
Energy 0.0%
Bharat Petroleum Corp., Ltd.	39,911	587,924
Software & Services 0.1%
Tata Consultancy Services Ltd.	30,689	1,171,808
		11,306,241
Indonesia 0.9%
Banks 0.7%
Bank Tabungan Negara Persero Tbk PT	23,004,900	3,059,233
PT Bank Central Asia Tbk	1,589,700	1,568,875
PT Bank Mandiri (Persero) Tbk	9,643,200	7,009,876
		11,637,984
Capital Goods 0.2%
Waskita Karya Persero Tbk PT	19,924,600	3,529,829
		15,167,813
Ireland 1.0%
Banks 0.0%
Bank of Ireland *	132,914	40,363
Capital Goods 0.1%
Kingspan Group plc	27,977	736,807
Consumer Services 0.2%
Dalata Hotel Group plc *	520,190	2,626,193
Paddy Power Betfair plc	394	52,952
		2,679,145
Food, Beverage & Tobacco 0.4%
Glanbia plc (g)	287,078	5,446,870
Glanbia plc (g)	55,978	1,055,047
Kerry Group plc, Class A	772	68,841
		6,570,758
Materials 0.1%
CRH plc	66,138	1,924,807
Pharmaceuticals, Biotechnology & Life Sciences 0.2%
Shire plc	59,805	3,731,953
		15,683,833

Security	Number of Shares	Value ($)
Israel 0.6%
Banks 0.0%
Bank Hapoalim B.M.	5,177	26,669
Bank Leumi Le-Israel B.M. *	6,827	25,371
Mizrahi Tefahot Bank Ltd.	884	10,282
		62,322
Energy 0.0%
Delek Group Ltd.	31	5,449
Materials 0.2%
Frutarom Industries Ltd.	60,320	3,136,577
Israel Chemicals Ltd.	3,168	15,783
		3,152,360
Pharmaceuticals, Biotechnology & Life Sciences 0.1%
Taro Pharmaceutical Industries Ltd. *	55	7,686
Teva Pharmaceutical Industries Ltd.	4,494	246,869
Teva Pharmaceutical Industries Ltd. ADR	39,538	2,152,844
		2,407,399
Real Estate 0.0%
Azrieli Group Ltd.	144	5,768
Software & Services 0.3%
Check Point Software Technologies Ltd. *	49,601	4,110,435
Mobileye N.V. *	393	14,993
NICE-Systems Ltd.	260	16,685
		4,142,113
Telecommunication Services 0.0%
Bezeq The Israeli Telecommunication Corp., Ltd.	9,390	19,789
		9,795,200
Italy 2.7%
Automobiles & Components 0.0%
Ferrari N.V. *	639	28,880
Fiat Chrysler Automobiles N.V.	4,386	35,310
		64,190
Banks 1.0%
Banco Popolare SC	1,766	12,505
FinecoBank Banca Fineco S.p.A.	607,770	4,896,012
Intesa Sanpaolo S.p.A.	4,189,087	11,644,824
UniCredit S.p.A.	23,277	90,268
Unione di Banche Italiane S.p.A.	4,397	18,690
		16,662,299
Capital Goods 0.0%
Finmeccanica S.p.A. *	1,955	24,783
Prysmian S.p.A.	971	22,973
		47,756
Consumer Durables & Apparel 0.6%
Luxottica Group S.p.A.	825	45,020
OVS S.p.A. *(e)	357,750	2,341,694
Prada S.p.A.	1,942,300	6,578,123
		8,964,837
Diversified Financials 0.6%
Azimut Holding S.p.A.	64,719	1,633,595
Banca Generali S.p.A.	42,741	1,271,847

42 See financial notes

Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
EXOR S.p.A.	191,671	7,218,991
Mediobanca S.p.A.	2,724	22,439
		10,146,872
Energy 0.0%
Eni S.p.A.	12,519	204,522
Saipem S.p.A. *	30,731	14,767
Tenaris S.A.	2,282	30,858
		250,147
Food, Beverage & Tobacco 0.4%
Davide Campari-Milano S.p.A.	681,600	6,593,542
Insurance 0.0%
Assicurazioni Generali S.p.A.	5,693	87,043
UnipolSai S.p.A.	5,504	12,880
		99,923
Retailing 0.1%
Yoox Net-A-Porter Group S.p.A. *	17,008	499,029
Telecommunication Services 0.0%
Telecom Italia S.p.A. *	55,952	54,636
Transportation 0.0%
Atlantia S.p.A.	2,013	56,111
Utilities 0.0%
Enel S.p.A.	37,535	170,590
Snam S.p.A.	10,241	62,628
Terna - Rete Elettrica Nationale S.p.A.	7,459	42,130
		275,348
		43,714,690
Japan 15.7%
Automobiles & Components 3.0%
Aisin Seiki Co., Ltd.	1,000	38,860
Bridgestone Corp.	3,200	117,784
Daihatsu Motor Co., Ltd.	900	12,011
Denso Corp.	2,400	91,227
F.C.C. Co., Ltd.	160,100	2,676,225
Fuji Heavy Industries Ltd.	50,200	1,648,316
Honda Motor Co., Ltd.	504,507	13,614,509
Isuzu Motors Ltd.	2,900	31,031
Koito Manufacturing Co., Ltd.	485	21,012
Mazda Motor Corp.	2,700	41,138
Mitsubishi Motors Corp.	3,100	12,475
Musashi Seimitsu Industry Co., Ltd.	177,000	3,378,609
NGK Spark Plug Co., Ltd.	900	17,949
NHK Spring Co., Ltd.	1,000	8,802
Nifco, Inc.	346,600	16,544,439
Nissan Motor Co., Ltd.	12,200	108,263
NOK Corp.	400	6,629
Stanley Electric Co., Ltd.	700	14,233
Sumitomo Electric Industries Ltd.	3,700	44,510
Sumitomo Rubber Industries Ltd.	800	12,179
Suzuki Motor Corp.	1,800	49,326
The Yokohama Rubber Co., Ltd.	500	8,382
Toyoda Gosei Co., Ltd.	400	7,376
Toyota Industries Corp.	814	35,318
Toyota Motor Corp.	197,477	10,010,051
Yamaha Motor Co., Ltd.	1,300	21,279
		48,571,933

Security	Number of Shares	Value ($)
Banks 0.6%
Aozora Bank Ltd.	5,000	17,740
Concordia Financial Group Ltd. *	5,900	28,413
Fukuoka Financial Group, Inc.	4,000	13,674
Hokuhoku Financial Group, Inc.	5,000	6,295
Japan Post Bank Co., Ltd.	2,000	24,418
Kyushu Financial Group, Inc.	2,100	11,023
Mitsubishi UFJ Financial Group, Inc.	62,700	289,349
Mizuho Financial Group, Inc.	115,900	173,724
Resona Holdings, Inc.	10,700	37,827
Seven Bank Ltd.	2,900	12,323
Shinsei Bank Ltd.	9,000	12,614
Sumitomo Mitsui Financial Group, Inc.	308,300	9,277,268
Sumitomo Mitsui Trust Holdings, Inc.	16,000	49,182
Suruga Bank Ltd.	900	17,500
The Bank of Kyoto Ltd.	2,000	13,415
The Chiba Bank Ltd.	3,000	15,150
The Chugoku Bank Ltd.	700	7,236
The Gunma Bank Ltd.	2,050	8,117
The Hachijuni Bank Ltd.	2,311	10,103
The Hiroshima Bank Ltd.	2,086	7,552
The Iyo Bank Ltd.	1,400	9,200
The Joyo Bank Ltd.	3,000	10,455
The Shizuoka Bank Ltd.	2,454	18,188
Yamaguchi Financial Group, Inc.	1,274	11,842
		10,082,608
Capital Goods 2.0%
Amada Holdings Co., Ltd.	1,626	16,336
Asahi Glass Co., Ltd.	5,000	29,282
Daifuku Co., Ltd.	32,715	585,103
Daikin Industries Ltd.	43,200	3,429,171
FANUC Corp.	999	147,574
Fuji Electric Co., Ltd.	3,000	12,766
Hino Motors Ltd.	1,300	12,544
Hitachi Construction Machinery Co., Ltd.	500	7,938
Hoshizaki Electric Co., Ltd.	53,600	4,498,284
IHI Corp.	6,000	13,011
ITOCHU Corp.	7,729	98,225
JGC Corp.	1,000	17,055
JTEKT Corp.	1,000	12,734
Kajima Corp.	4,000	24,849
Kawasaki Heavy Industries Ltd.	7,000	19,632
Keihan Holdings Co., Ltd.	2,126	15,416
Komatsu Ltd.	368,500	6,328,955
Kubota Corp.	5,500	80,118
Kurita Water Industries Ltd.	600	14,428
LIXIL Group Corp.	1,300	27,220
Mabuchi Motor Co., Ltd.	200	9,955
Makita Corp.	17,000	1,072,418
Marubeni Corp.	8,045	42,705
Minebea Co., Ltd.	1,587	12,999
MISUMI Group, Inc.	630,800	8,711,205
Mitsubishi Corp.	6,649	111,760
Mitsubishi Electric Corp.	10,000	106,274
Mitsubishi Heavy Industries Ltd.	15,000	53,319
Mitsui & Co., Ltd.	8,400	102,608
Nabtesco Corp.	700	15,791
NGK Insulators Ltd.	1,000	20,537

See financial notes 43

Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Nidec Corp.	1,100	80,601
NSK Ltd.	2,300	20,074
Obayashi Corp.	3,200	31,361
Penta-Ocean Construction Co., Ltd.	1,146,700	5,163,948
Seibu Holdings, Inc.	600	12,658
Shimizu Corp.	3,000	26,888
SMC Corp.	237	57,795
Sumitomo Corp.	5,500	58,147
Sumitomo Heavy Industries Ltd.	3,000	12,608
Taisei Corp.	247,000	1,685,907
THK Co., Ltd.	500	9,931
Toshiba Corp. *	20,000	42,299
TOTO Ltd.	700	23,737
Toyota Tsusho Corp.	1,100	24,898
		32,901,064
Commercial & Professional Supplies 0.4%
Dai Nippon Printing Co., Ltd.	3,000	28,135
Park24 Co., Ltd.	600	16,817
Recruit Holdings Co., Ltd.	700	21,627
Secom Co., Ltd.	14,100	1,083,515
Sohgo Security Services Co., Ltd.	97,900	5,436,377
Temp Holdings Co., Ltd.	34,600	519,402
Toppan Printing Co., Ltd.	2,261	19,333
		7,125,206
Consumer Durables & Apparel 0.1%
Asics Corp.	700	13,864
Bandai Namco Holdings, Inc.	900	19,160
Casio Computer Co., Ltd.	54,736	1,041,457
Haseko Corp.	41,700	377,075
Iida Group Holdings Co., Ltd.	713	13,316
Nikon Corp.	1,700	24,781
Panasonic Corp.	10,800	96,316
Rinnai Corp.	200	17,650
Sankyo Co., Ltd.	200	7,572
Sega Sammy Holdings, Inc.	800	8,711
Sekisui Chemical Co., Ltd.	2,082	26,021
Sekisui House Ltd.	2,955	51,309
Shimano, Inc.	345	49,498
Sony Corp.	6,200	150,174
Yamaha Corp.	800	22,960
		1,919,864
Consumer Services 0.2%
Benesse Holdings, Inc.	300	8,512
Kyoritsu Maintenance Co., Ltd.	32,400	2,463,986
McDonald's Holdings Co., Ltd.	400	9,993
Oriental Land Co., Ltd.	1,000	69,440
		2,551,931
Diversified Financials 2.5%
Acom Co., Ltd. *	2,000	10,433
AEON Financial Service Co., Ltd.	600	13,391
Credit Saison Co., Ltd.	711	13,074
Daiwa Securities Group, Inc.	1,782,000	10,378,052
Japan Exchange Group, Inc.	2,700	40,212
Mitsubishi UFJ Lease & Finance Co., Ltd.	2,900	12,639
Nihon M&A Center, Inc.	141,000	8,120,185
Nomura Holdings, Inc.	2,921,700	12,413,606
ORIX Corp.	311,600	4,407,560

Security	Number of Shares	Value ($)
SBI Holdings, Inc.	936	9,691
Zenkoku Hosho Co., Ltd.	132,700	4,666,919
		40,085,762
Energy 0.0%
Idemitsu Kosan Co., Ltd.	400	8,545
Inpex Corp.	4,600	36,569
JX Holdings, Inc.	10,900	46,847
Showa Shell Sekiyu K.K.	1,200	12,523
TonenGeneral Sekiyu K.K.	1,367	12,948
		117,432
Food & Staples Retailing 0.4%
Aeon Co., Ltd.	3,200	47,953
FamilyMart Co., Ltd.	300	15,832
Lawson, Inc.	9,929	768,537
Seven & i Holdings Co., Ltd.	3,700	150,969
Tsuruha Holdings, Inc.	51,300	4,920,469
		5,903,760
Food, Beverage & Tobacco 0.5%
Ajinomoto Co., Inc.	2,778	64,034
Ariake Japan Co., Ltd.	79,700	4,415,575
Asahi Group Holdings Ltd.	1,900	60,300
Calbee, Inc.	400	15,572
Japan Tobacco, Inc.	60,700	2,480,076
Kikkoman Corp.	314	10,005
Kirin Holdings Co., Ltd.	4,000	57,691
MEIJI Holdings Co., Ltd.	600	46,237
NH Foods Ltd.	409	9,116
Nisshin Seifun Group, Inc.	1,000	16,371
Nissin Foods Holdings Co., Ltd.	300	13,927
Suntory Beverage & Food Ltd.	700	30,578
Toyo Suisan Kaisha Ltd.	465	16,423
Yakult Honsha Co., Ltd.	400	19,828
Yamazaki Baking Co., Ltd.	1,000	23,673
		7,279,406
Health Care Equipment & Services 0.8%
Alfresa Holdings Corp.	800	15,406
Asahi Intecc Co., Ltd.	55,000	2,645,962
Hogy Medical Co., Ltd.	78,800	4,388,517
Hoya Corp.	44,400	1,700,265
M3, Inc.	36,100	973,850
Medipal Holdings Corp.	600	9,493
Miraca Holdings, Inc.	86,800	3,688,750
Olympus Corp.	1,400	54,539
Suzuken Co., Ltd.	400	13,707
Sysmex Corp.	700	43,777
Terumo Corp.	1,500	57,023
		13,591,289
Household & Personal Products 0.6%
Kao Corp.	60,000	3,319,019
Kose Corp.	200	18,293
Lion Corp.	343,000	4,220,340
Pigeon Corp.	82,400	2,164,289
Pola Orbis Holdings, Inc.	6,000	477,169
Shiseido Co., Ltd.	1,800	40,033
Unicharm Corp.	1,800	37,208
		10,276,351
Insurance 0.3%
Anicom Holdings, Inc.	170,900	4,010,485
Japan Post Holdings Co., Ltd.	2,200	29,640

44 See financial notes

Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
MS&AD Insurance Group Holdings, Inc.	2,510	66,293
Sompo Japan Nipponkoa Holdings, Inc.	1,600	42,010
Sony Financial Holdings, Inc.	900	11,127
T&D Holdings, Inc.	2,800	26,803
The Dai-ichi Life Insurance Co., Ltd.	5,300	63,704
Tokio Marine Holdings, Inc.	3,400	111,256
		4,361,318
Materials 0.1%
Air Water, Inc.	1,278	19,199
Asahi Kasei Corp.	6,463	44,221
Daicel Corp.	81,800	1,021,841
Hitachi Chemical Co., Ltd.	500	8,397
Hitachi Metals Ltd.	1,000	10,154
JFE Holdings, Inc.	2,400	33,680
JSR Corp.	900	12,337
Kaneka Corp.	1,337	11,190
Kansai Paint Co., Ltd.	1,073	18,766
Kobe Steel Ltd.	14,000	13,443
Kuraray Co., Ltd.	1,700	21,553
Maruichi Steel Tube Ltd.	200	5,817
Mitsubishi Chemical Holdings Corp.	6,600	34,442
Mitsubishi Gas Chemical Co., Inc.	2,000	10,968
Mitsubishi Materials Corp.	5,049	16,014
Mitsui Chemicals, Inc.	4,000	13,266
Nippon Paint Holdings Co., Ltd.	700	18,380
Nippon Steel & Sumitomo Metal Corp.	3,800	79,070
Nissan Chemical Industries Ltd.	25,800	689,065
Nitto Denko Corp.	800	43,096
Oji Holdings Corp.	4,000	16,426
Shin-Etsu Chemical Co., Ltd.	2,024	113,362
Sumitomo Chemical Co., Ltd.	7,000	31,639
Sumitomo Metal Mining Co., Ltd.	2,000	22,565
Taiheiyo Cement Corp.	6,000	15,876
Taiyo Nippon Sanso Corp.	629	5,808
Teijin Ltd.	5,000	17,901
Toray Industries, Inc.	7,000	58,470
Toyo Seikan Group Holdings Ltd.	800	15,772
		2,422,718
Media 0.0%
Dentsu, Inc.	1,100	55,890
Hakuhodo DY Holdings, Inc.	1,100	12,401
Toho Co., Ltd.	700	17,741
		86,032
Pharmaceuticals, Biotechnology & Life Sciences 0.2%
Astellas Pharma, Inc.	10,400	140,219
Chugai Pharmaceutical Co., Ltd.	1,100	37,071
Daiichi Sankyo Co., Ltd.	3,100	73,059
Eisai Co., Ltd.	1,200	74,280
Hisamitsu Pharmaceutical Co., Inc.	300	14,193
Kyowa Hakko Kirin Co., Ltd.	1,200	21,334
Mitsubishi Tanabe Pharma Corp.	1,100	19,585
Ono Pharmaceutical Co., Ltd.	2,000	90,116
Otsuka Holdings Co., Ltd.	1,900	74,070
Santen Pharmaceutical Co., Ltd.	1,800	25,797
Sawai Pharmaceutical Co., Ltd.	7,600	489,591
Shionogi & Co., Ltd.	44,800	2,286,688
Sumitomo Dainippon Pharma Co., Ltd.	800	10,298

Security	Number of Shares	Value ($)
Taisho Pharmaceutical Holdings Co., Ltd.	200	16,427
Takeda Pharmaceutical Co., Ltd.	3,900	186,271
		3,558,999
Real Estate 1.1%
Aeon Mall Co., Ltd.	500	6,877
Daito Trust Construction Co., Ltd.	6,100	862,736
Daiwa House Industry Co., Ltd.	106,900	2,856,016
Hulic Co., Ltd.	1,500	14,929
Invincible Investment Corp.	7,830	5,945,562
Japan Prime Realty Investment Corp.	4	17,632
Japan Real Estate Investment Corp.	6	37,362
Japan Retail Fund Investment Corp.	13	31,939
Mitsubishi Estate Co., Ltd.	6,587	125,170
Mitsui Fudosan Co., Ltd.	5,000	122,112
Nippon Building Fund, Inc.	7	44,345
Nippon Prologis REIT, Inc.	249	597,061
Nomura Real Estate Holdings, Inc.	700	12,793
Nomura Real Estate Master Fund, Inc.	17	26,669
NTT Urban Development Corp.	700	6,551
Open House Co., Ltd.	213,100	4,529,782
Sumitomo Realty & Development Co., Ltd.	66,495	1,933,426
Tokyo Tatemono Co., Ltd.	1,200	15,844
Tokyu Fudosan Holdings Corp.	2,300	15,637
United Urban Investment Corp.	13	22,438
		17,224,881
Retailing 0.7%
ABC-Mart, Inc.	100	6,489
Bic Camera, Inc.	408,000	3,974,012
Don Quijote Holdings Co., Ltd.	600	21,346
Fast Retailing Co., Ltd.	230	60,560
Gulliver International Co., Ltd.	201,400	1,979,699
Hikari Tsushin, Inc.	100	7,490
Isetan Mitsukoshi Holdings Ltd.	1,721	18,263
J. Front Retailing Co., Ltd.	1,100	13,215
Marui Group Co., Ltd.	1,000	15,278
Nitori Holdings Co., Ltd.	6,705	623,691
Rakuten, Inc.	4,600	50,008
Ryohin Keikaku Co., Ltd.	16,900	3,764,705
Sanrio Co., Ltd.	300	5,898
Shimamura Co., Ltd.	142	19,169
Takashimaya Co., Ltd.	1,000	7,301
USS Co., Ltd.	1,100	17,400
Yamada Denki Co., Ltd.	3,300	16,613
		10,601,137
Semiconductors & Semiconductor Equipment 0.3%
Rohm Co., Ltd.	500	21,638
Tokyo Electron Ltd.	800	52,874
Ulvac, Inc.	141,700	4,344,760
		4,419,272
Software & Services 0.6%
Dip Corp.	168,400	3,969,978
Fujitsu Ltd.	9,000	31,447
GungHo Online Entertainment, Inc.	3,100	8,114
Istyle, Inc.	490,400	3,575,028

See financial notes 45

Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
IT Holdings Corp.	22,200	524,623
Itochu Techno-Solutions Corp.	200	3,919
Kakaku.com, Inc.	700	12,608
Konami Holdings Corp.	400	12,612
Mixi, Inc.	201	6,868
Nexon Co., Ltd.	600	9,009
Nintendo Co., Ltd.	500	67,700
Nomura Research Institute Ltd.	600	21,048
NTT Data Corp.	600	31,236
Obic Co., Ltd.	300	15,768
Oracle Corp., Japan	200	10,773
Otsuka Corp.	300	14,306
SCSK Corp.	18,300	663,757
Trend Micro, Inc.	500	18,962
Yahoo Japan Corp.	6,900	30,867
		9,028,623
Technology Hardware & Equipment 1.0%
Alps Electric Co., Ltd.	28,800	497,770
Brother Industries Ltd.	1,100	12,470
Canon, Inc.	5,265	147,224
Citizen Holdings Co., Ltd.	1,500	8,461
FUJIFILM Holdings Corp.	2,300	94,411
Hamamatsu Photonics K.K.	700	19,454
Hirose Electric Co., Ltd.	100	12,095
Hitachi High-Technologies Corp.	400	10,823
Hitachi Ltd.	23,322	106,867
Keyence Corp.	4,000	2,397,572
Konica Minolta, Inc.	2,200	18,989
Kyocera Corp.	1,600	79,392
Murata Manufacturing Co., Ltd.	21,824	2,846,095
NEC Corp.	13,000	31,639
Nippon Electric Glass Co., Ltd.	2,000	10,589
Omron Corp.	282,600	8,968,838
Ricoh Co., Ltd.	3,500	35,668
Seiko Epson Corp.	1,400	22,942
Shimadzu Corp.	1,000	14,967
TDK Corp.	600	35,108
Yaskawa Electric Corp.	1,121	13,128
Yokogawa Electric Corp.	1,000	10,744
		15,395,246
Telecommunication Services 0.3%
KDDI Corp.	163,100	4,698,215
Nippon Telegraph & Telephone Corp.	3,400	152,151
NTT DOCOMO, Inc.	7,000	167,888
SoftBank Group Corp.	4,731	254,388
		5,272,642
Transportation 0.0%
ANA Holdings, Inc.	5,409	15,104
Central Japan Railway Co.	700	122,623
East Japan Railway Co.	1,638	144,105
Hankyu Hanshin Holdings, Inc.	6,000	38,031
Japan Airlines Co., Ltd.	600	21,597
Japan Airport Terminal Co., Ltd.	200	7,137
Kamigumi Co., Ltd.	1,000	8,966
Keikyu Corp.	2,000	18,104
Keio Corp.	3,000	26,424
Keisei Electric Railway Co., Ltd.	1,266	17,417
Kintetsu Group Holdings Co., Ltd.	9,000	37,013
Mitsubishi Logistics Corp.	1,000	13,671
Mitsui O.S.K. Lines, Ltd.	7,000	14,875

Security	Number of Shares	Value ($)
Nagoya Railroad Co., Ltd.	4,000	20,174
Nippon Express Co., Ltd.	4,000	18,254
Nippon Yusen K.K.	8,000	15,672
Odakyu Electric Railway Co., Ltd.	3,000	32,578
Tobu Railway Co., Ltd.	5,000	25,625
Tokyu Corp.	6,000	52,002
West Japan Railway Co.	841	50,768
Yamato Holdings Co., Ltd.	1,700	34,287
		734,427
Utilities 0.0%
Chubu Electric Power Co., Inc.	3,131	41,242
Electric Power Development Co., Ltd.	700	21,097
Hokuriku Electric Power Co.	800	10,478
Kyushu Electric Power Co., Inc.	2,100	21,077
Osaka Gas Co., Ltd.	9,000	32,447
Shikoku Electric Power Co., Inc.	900	11,109
The Chugoku Electric Power Co., Inc.	1,400	18,170
The Kansai Electric Power Co., Inc. *	3,400	29,944
Toho Gas Co., Ltd.	2,330	15,909
Tohoku Electric Power Co., Inc.	2,200	28,127
Tokyo Electric Power Co. Holdings, Inc. *	7,000	37,491
Tokyo Gas Co., Ltd.	11,000	48,550
		315,641
		253,827,542
Luxembourg 0.3%
Materials 0.3%
APERAM S.A.	105,470	4,152,085
Telecommunication Services 0.0%
Millicom International Cellular S.A. SDR	334	19,338
		4,171,423
Malaysia 0.2%
Software & Services 0.2%
My EG Services Berhad	7,893,700	4,056,786
Mexico 1.1%
Banks 0.1%
Banregio Grupo Financiero S.A.B de C.V.	396,800	2,377,850
Consumer Services 0.3%
Alsea S.A.B. de C.V.	1,195,020	4,576,662
Food, Beverage & Tobacco 0.1%
Arca Continental S.A.B. de C.V.	119,873	827,457
Fomento Economico Mexicano S.A.B. de C.V. ADR	7,684	716,226
		1,543,683
Media 0.3%
Grupo Televisa S.A.B. ADR	188,400	5,506,932

46 See financial notes

Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Transportation 0.3%
Controladora Vuela Cia de Aviacion S.A.B. de C.V. ADR *	201,370	4,204,606
		18,209,733
Netherlands 1.9%
Banks 0.0%
ING Groep N.V. CVA	19,037	233,268
Capital Goods 0.7%
AerCap Holdings N.V. *	429	17,164
Boskalis Westminster N.V.	51,032	2,128,189
Koninklijke Philips N.V.	171,919	4,724,089
TKH Group N.V.	105,430	4,168,293
		11,037,735
Commercial & Professional Supplies 0.0%
Randstad Holding N.V.	619	33,263
Consumer Durables & Apparel 0.1%
Steinhoff International Holdings N.V.	272,586	1,705,170
Energy 0.0%
Koninklijke Vopak N.V.	333	18,105
Food & Staples Retailing 0.0%
Koninklijke Ahold N.V.	4,113	89,557
Food, Beverage & Tobacco 0.2%
Heineken Holding N.V.	487	40,205
Heineken N.V.	1,135	106,494
Refresco Gerber N.V. *(e)	129,402	2,395,938
		2,542,637
Household & Personal Products 0.0%
Unilever N.V. CVA	8,011	351,922
Insurance 0.0%
Aegon N.V.	9,094	52,284
NN Group N.V.	1,552	53,874
		106,158
Materials 0.1%
Akzo Nobel N.V.	22,624	1,607,358
ArcelorMittal	8,401	47,425
Koninklijke DSM N.V.	896	54,994
OCI N.V. *	395	7,805
		1,717,582
Media 0.2%
Altice N.V., Class A *	1,782	27,015
Altice N.V., Class B *	586	8,957
RELX N.V.	4,851	81,466
Wolters Kluwer N.V.	77,624	2,956,902
		3,074,340
Real Estate 0.2%
Unibail-Rodamco SE	7,995	2,143,022
Retailing 0.0%
GrandVision N.V. (e)	15,961	438,356
Semiconductors & Semiconductor Equipment 0.4%
ASML Holding N.V.	37,406	3,615,506
NXP Semiconductors N.V. *	35,851	3,057,373
		6,672,879
Software & Services 0.0%
Gemalto N.V.	391	25,416

Security	Number of Shares	Value ($)
Telecommunication Services 0.0%
Koninklijke (Royal) KPN N.V.	15,616	61,365
Transportation 0.0%
TNT Express N.V. *	2,248	20,407
		30,271,182
New Zealand 1.1%
Consumer Services 0.2%
SKYCITY Entertainment Group Ltd.	920,409	3,140,100
Food, Beverage & Tobacco 0.0%
a2 Milk Co., Ltd. *	485,940	589,497
Health Care Equipment & Services 0.0%
Ryman Healthcare Ltd.	1,607	10,017
Materials 0.0%
Fletcher Building Ltd.	3,179	18,480
Telecommunication Services 0.0%
Spark New Zealand Ltd.	8,522	22,036
Transportation 0.6%
Auckland International Airport Ltd.	2,126,987	9,124,168
Utilities 0.3%
Contact Energy Ltd.	4,338	15,392
Meridian Energy Ltd.	5,457	10,080
Mighty River Power Ltd.	2,476,909	5,226,510
		5,251,982
		18,156,280
Norway 0.2%
Banks 0.0%
DNB A.S.A.	4,765	60,975
Energy 0.1%
Det Norske Oljeselskap A.S.A *	309,370	2,752,480
Statoil A.S.A.	5,442	95,786
		2,848,266
Food, Beverage & Tobacco 0.0%
Orkla A.S.A.	3,938	34,379
Insurance 0.1%
Gjensidige Forsikring A.S.A.	49,275	843,622
Materials 0.0%
Norsk Hydro A.S.A.	6,498	28,273
Yara International A.S.A.	864	34,558
		62,831
Media 0.0%
Schibsted A.S.A., B Shares *	394	11,211
Schibsted A.S.A., Class A	328	9,559
		20,770
Telecommunication Services 0.0%
Telenor A.S.A.	3,661	62,992
		3,933,835
Papua New Guinea 0.0%
Energy 0.0%
Oil Search Ltd.	6,621	35,103

See financial notes 47

Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Peru 0.1%
Banks 0.1%
Credicorp Ltd.	15,435	2,244,558
Portugal 0.1%
Banks 0.0%
Banco Comercial Portugues S.A., Class R *	391,289	17,384
Banco Espirito Santo S.A. - Reg'd *(a)	42,176	—
		17,384
Energy 0.0%
Galp Energia, SGPS, S.A.	2,226	30,584
Food & Staples Retailing 0.1%
Jeronimo Martins, SGPS, S.A.	75,349	1,233,639
Utilities 0.0%
EDP - Energias de Portugal S.A.	11,189	39,778
		1,321,385
Republic of Korea 2.2%
Capital Goods 0.2%
LIG Nex1 Co., Ltd.	37,430	2,920,700
Energy 0.1%
SK Innovation Co., Ltd.	13,254	1,790,050
Food, Beverage & Tobacco 0.3%
Hite Jinro Co., Ltd.	179,240	4,391,342
KT&G Corp	6,589	709,867
		5,101,209
Health Care Equipment & Services 0.3%
Osstem Implant Co., Ltd. *	51,290	3,211,565
Vieworks Co., Ltd.	45,360	1,999,241
		5,210,806
Household & Personal Products 0.0%
Amorepacific Corp.	1,760	627,685
Materials 0.1%
LG Chem Ltd.	5,868	1,522,125
Pharmaceuticals, Biotechnology & Life Sciences 0.4%
Caregen Co., Ltd.	21,590	2,049,651
Medy-Tox, Inc.	11,230	4,151,334
		6,200,985
Semiconductors & Semiconductor Equipment 0.1%
SK Hynix, Inc.	33,450	820,455
Technology Hardware & Equipment 0.7%
Samsung Electronics Co., Ltd.	10,735	11,699,332
		35,893,347
Singapore 2.7%
Banks 0.0%
DBS Group Holdings Ltd.	8,616	97,456
Oversea-Chinese Banking Corp., Ltd.	15,238	98,988
United Overseas Bank Ltd.	6,300	86,818
		283,262

Security	Number of Shares	Value ($)
Capital Goods 0.2%
Jardine Matheson Holdings Ltd.	1,209	66,679
Keppel Corp., Ltd.	7,000	27,974
Noble Group Ltd. *	34,000	11,527
Sarine Technologies Ltd. (f)	1,928,800	2,366,450
Sembcorp Industries Ltd.	4,200	8,977
Sembcorp Marine Ltd.	3,100	3,830
Singapore Technologies Engineering Ltd.	7,400	17,664
Yangzijiang Shipbuilding Holdings Ltd.	7,700	5,645
		2,508,746
Consumer Services 0.0%
Genting Singapore plc	28,700	17,323
Diversified Financials 0.0%
Singapore Exchange Ltd.	3,900	21,768
Food, Beverage & Tobacco 0.0%
Golden Agri-Resources Ltd.	70,000	20,765
Wilmar International Ltd.	9,300	25,547
		46,312
Media 0.0%
Singapore Press Holdings Ltd.	7,500	22,576
Real Estate 1.2%
Ascendas Real Estate Investment Trust	4,978,433	9,086,069
CapitaLand Commercial Trust Ltd.	8,700	9,230
CapitaLand Ltd.	12,400	28,563
CapitaLand Mall Trust	6,460,300	9,917,532
City Developments Ltd.	1,927	11,919
Global Logistic Properties Ltd.	15,200	21,554
Suntec Real Estate Investment Trust	11,824	14,773
UOL Group Ltd.	2,100	9,563
		19,099,203
Retailing 0.0%
Jardine Cycle & Carriage Ltd.	24,411	697,907
Telecommunication Services 0.2%
Singapore Telecommunications Ltd.	923,800	2,641,478
StarHub Ltd.	2,500	6,141
		2,647,619
Transportation 1.0%
ComfortDelGro Corp., Ltd.	10,100	21,647
Hutchison Port Holdings Trust, Class U	34,100	15,138
SATS Ltd.	2,849,600	8,677,682
SIA Engineering Co., Ltd. (f)	2,858,600	8,051,772
Singapore Airlines Ltd.	2,631	22,460
		16,788,699
Utilities 0.1%
Hyflux Ltd.	2,370,800	1,089,149
		43,222,564
South Africa 0.3%
Capital Goods 0.1%
The Bidvest Group Ltd.	32,115	815,928

48 See financial notes

Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Food & Staples Retailing 0.0%
The SPAR Group Ltd.	30,000	448,359
Insurance 0.1%
Sanlam Ltd.	169,858	824,893
Media 0.1%
Naspers Ltd., N Shares	16,467	2,266,045
		4,355,225
Spain 0.8%
Banks 0.2%
Banco Bilbao Vizcaya Argentaria S.A.	147,189	1,011,454
Banco De Sabadell S.A. *(a)	718	1,375
Banco De Sabadell S.A.	24,703	47,333
Banco Popular Espanol S.A.	8,368	22,817
Banco Santander S.A.	70,989	360,505
Bankia S.A.	22,259	20,764
Bankinter S.A.	204,053	1,557,495
CaixaBank S.A.	12,875	38,866
		3,060,609
Capital Goods 0.0%
ACS, Actividades de Construccion y Servicios S.A.	928	30,779
Ferrovial S.A.	2,374	51,219
Zardoya Otis S.A.	848	9,011
		91,009
Commercial & Professional Supplies 0.2%
Prosegur Cia de Seguridad S.A. - Reg'd	525,989	3,046,951
Energy 0.0%
Repsol S.A.	5,354	70,547
Food & Staples Retailing 0.1%
Distribuidora Internacional de Alimentacion S.A. *	129,775	722,115
Insurance 0.0%
Mapfre S.A.	5,208	13,248
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
Grifols S.A.	1,442	31,440
Retailing 0.1%
Industria de Diseno Textil S.A.	64,742	2,083,758
Software & Services 0.2%
Amadeus IT Holding S.A., A Shares	55,590	2,534,924
Telecommunication Services 0.0%
Telefonica S.A.	22,172	242,544
Transportation 0.0%
Abertis Infraestructuras S.A.	2,516	42,476
Aena S.A. *(e)	334	47,713
International Consolidated Airlines Group S.A.	3,927	30,282
		120,471
Utilities 0.0%
Enagas S.A.	1,048	31,996
Endesa S.A.	1,535	32,296
Gas Natural SDG S.A.	1,692	35,283

Security	Number of Shares	Value ($)
Iberdrola S.A.	27,006	192,249
Red Electrica Corp. S.A.	535	47,847
		339,671
		12,357,287
Sweden 4.1%
Banks 0.2%
Nordea Bank AB	14,956	145,374
Skandinaviska Enskilda Banken AB, A Shares	7,407	70,816
Svenska Handelsbanken AB, A Shares	7,381	98,464
Swedbank AB, A Shares	110,123	2,377,424
		2,692,078
Capital Goods 2.0%
Alfa Laval AB	1,419	22,389
Assa Abloy AB, Class B	76,705	1,611,745
Atlas Copco AB, A Shares	75,544	1,957,137
Atlas Copco AB, B Shares	166,329	3,996,207
Eltel AB *(e)	448,409	5,374,464
Indutrade AB	35,490	1,991,328
Inwido AB	198,338	2,498,733
Saab AB, Class B	223,250	7,646,822
Sandvik AB	5,267	54,114
Skanska AB, B Shares	1,836	40,467
SKF AB, B Shares	350,023	6,450,104
Volvo AB, B Shares	7,517	88,150
		31,731,660
Commercial & Professional Supplies 0.7%
AF AB, B Shares (f)	512,320	8,787,419
Intrum Justitia AB	22,958	825,257
Loomis AB, Class B	80,500	2,236,064
Securitas AB, B Shares	1,527	24,145
		11,872,885
Consumer Durables & Apparel 0.0%
Electrolux AB, B Shares	1,162	33,768
Husqvarna AB, B Shares	2,486	19,841
		53,609
Diversified Financials 0.1%
Avanza Bank Holding AB	49,880	1,961,418
Industrivarden AB, C Shares	809	14,746
Investment AB Kinnevik, B Shares	1,137	32,755
Investor AB, B Shares	2,221	81,600
		2,090,519
Energy 0.0%
Lundin Petroleum AB *	1,100	20,638
Food & Staples Retailing 0.0%
ICA Gruppen AB	464	15,256
Food, Beverage & Tobacco 0.3%
AAK AB	65,300	4,938,689
Swedish Match AB	949	30,142
		4,968,831
Health Care Equipment & Services 0.0%
Getinge AB, B Shares	976	20,670
Household & Personal Products 0.0%
Svenska Cellulosa AB, S.C.A., B Shares	2,981	94,055

See financial notes 49

Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Materials 0.1%
BillerudKorsnas AB	28,097	436,945
Boliden AB	1,281	22,405
Hexpol AB	53,801	556,808
		1,016,158
Real Estate 0.3%
Fastighets AB Balder, B Shares *	187,910	4,793,039
Retailing 0.3%
Hennes & Mauritz AB, B Shares	163,473	5,821,330
Technology Hardware & Equipment 0.1%
Hexagon AB, B Shares	43,927	1,754,654
Telefonaktiebolaget LM Ericsson, B Shares	14,984	121,406
		1,876,060
Telecommunication Services 0.0%
Tele2 AB, B Shares	1,422	13,587
Telia Co. AB	12,668	60,585
		74,172
		67,140,960
Switzerland 5.8%
Capital Goods 0.8%
ABB Ltd. - Reg'd *	10,820	229,062
Belimo Holding AG - Reg'd	717	2,047,931
Burckhardt Compression Holding AG	19,422	6,922,794
Daetwyler Holding AG	20,915	3,111,422
Geberit AG - Reg'd	187	71,945
Schindler Holding AG	214	39,028
Schindler Holding AG - Reg'd	99	18,214
Sulzer AG - Reg'd	69	6,299
		12,446,695
Commercial & Professional Supplies 0.0%
Adecco S.A. - Reg'd	808	52,159
SGS S.A. - Reg'd	27	59,532
		111,691
Consumer Durables & Apparel 0.9%
Cie Financiere Richemont S.A. - Reg'd	124,969	8,332,959
The Swatch Group AG - Bearer Shares	17,620	6,011,617
The Swatch Group AG - Reg'd	240	16,057
		14,360,633
Diversified Financials 1.4%
Credit Suisse Group AG - Reg'd *	1,172,932	17,850,217
Julius Baer Group Ltd. *	1,091	46,756
Pargesa Holding S.A.	144	10,019
Partners Group Holding AG	9,417	3,883,932
UBS Group AG - Reg’d	17,987	311,813
		22,102,737
Food, Beverage & Tobacco 0.1%
Aryzta AG *	407	15,831
Barry Callebaut AG - Reg'd *	11	12,941
Chocoladefabriken Lindt & Sprungli AG	5	30,637

Security	Number of Shares	Value ($)
Chocoladefabriken Lindt & Sprungli AG - Reg'd	1	73,207
Nestle S.A. - Reg'd	23,870	1,781,648
		1,914,264
Health Care Equipment & Services 0.7%
Sonova Holding AG - Reg'd	260	34,808
Straumann Holding AG - Reg'd	26,163	9,083,411
Ypsomed Holding AG - Reg’d *	19,580	2,920,236
		12,038,455
Insurance 0.0%
Baloise Holding AG - Reg'd	244	30,245
Swiss Life Holding AG - Reg'd *	159	40,214
Swiss Re AG	1,733	154,027
Zurich Insurance Group AG *	740	166,044
		390,530
Materials 0.8%
Clariant AG - Reg'd *	82,773	1,568,265
EMS-Chemie Holding AG - Reg'd	40	19,795
Givaudan S.A. - Reg'd	45	88,824
LafargeHolcim Ltd. - Reg'd *	227,803	11,566,805
Sika AG	11	46,881
Syngenta AG - Reg'd	458	183,733
		13,474,303
Pharmaceuticals, Biotechnology & Life Sciences 0.5%
Actelion Ltd. - Reg'd *	21,038	3,409,841
Galenica AG - Reg'd	19	27,816
Lonza Group AG - Reg'd *	13,666	2,279,328
Novartis AG - Reg'd	11,184	851,127
Roche Holding AG	3,453	873,641
		7,441,753
Real Estate 0.0%
Swiss Prime Site AG - Reg'd *	323	28,316
Retailing 0.0%
Dufry AG - Reg'd *	197	25,968
Software & Services 0.3%
Luxoft Holding, Inc. *	7,307	422,417
Temenos Group AG - Reg'd *	78,570	4,077,318
		4,499,735
Technology Hardware & Equipment 0.1%
Logitech International S.A. - Reg'd	50,642	778,090
Telecommunication Services 0.0%
Swisscom AG - Reg'd	126	64,031
Transportation 0.2%
Kuehne & Nagel International AG - Reg'd	26,261	3,789,862
		93,467,063
Taiwan 1.5%
Automobiles & Components 0.5%
Hota Industrial Manufacturing Co., Ltd.	888,000	4,248,690
Tung Thih Electronic Co., Ltd.	264,000	4,692,319
		8,941,009
Capital Goods 0.3%
Airtac International Group	656,000	4,334,733

50 See financial notes

Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Semiconductors & Semiconductor Equipment 0.6%
Chipbond Technology Corp.	275,000	364,889
Land Mark Optoelectronics Corp.	268,000	3,933,985
Taiwan Semiconductor Manufacturing Co., Ltd.	282,000	1,295,612
Taiwan Semiconductor Manufacturing Co., Ltd. ADR	171,444	4,044,364
		9,638,850
Technology Hardware & Equipment 0.1%
Catcher Technology Co., Ltd.	108,000	755,875
Largan Precision Co., Ltd.	18,000	1,256,473
		2,012,348
		24,926,940
Turkey 0.1%
Banks 0.1%
Turkiye Garanti Bankasi A/S	460,394	1,417,192
United Arab Emirates 0.1%
Banks 0.1%
Dubai Islamic Bank PJSC	554,704	875,479
United Kingdom 16.9%
Automobiles & Components 0.0%
GKN plc	8,280	33,790
Banks 0.6%
Barclays plc	82,659	207,537
HSBC Holdings plc	96,279	638,029
Lloyds Banking Group plc	8,083,263	7,933,808
Royal Bank of Scotland Group plc *	16,930	56,958
Standard Chartered plc	16,130	130,373
		8,966,705
Capital Goods 4.3%
Ashtead Group plc	518,032	6,889,518
BAE Systems plc	15,593	108,787
Bodycote plc	336,858	2,940,660
Brammer plc	852,012	2,172,382
Bunzl plc	58,407	1,743,333
CNH Industrial N.V.	1,452,884	11,169,596
Cobham plc	5,336	12,039
Diploma plc (f)	570,217	6,101,560
IMI plc	1,223	16,737
Interserve plc	989,931	6,185,867
Meggitt plc	566,150	3,403,894
Rolls-Royce Holdings plc *(a)	636,520	930
Rolls-Royce Holdings plc *	8,965	87,949
Rotork plc	1,624,780	4,444,963
Smiths Group plc	307,226	4,985,778
Spirax-Sarco Engineering plc	202,579	10,121,489
The Weir Group plc	953	16,740
Travis Perkins plc	1,202	32,520
Ultra Electronics Holdings plc	151,415	3,910,039
Wolseley plc	83,784	4,692,916
		69,037,697
Commercial & Professional Supplies 1.5%
Aggreko plc	1,153	18,353
Babcock International Group plc	60,664	841,835

Security	Number of Shares	Value ($)
Capita plc	3,240	47,472
Experian plc	433,220	7,938,656
G4S plc	1,402,166	3,866,497
Intertek Group plc	33,582	1,602,052
Regus plc	1,191,340	5,097,399
Rentokil Initial Plc	2,060,870	5,310,798
		24,723,062
Consumer Durables & Apparel 0.7%
Barratt Developments plc	4,964	38,657
Bellway plc	219,780	7,869,716
Berkeley Group Holdings plc	28,139	1,233,065
Burberry Group plc	124,649	2,170,334
Persimmon plc	1,481	43,076
Taylor Wimpey plc	15,720	42,406
		11,397,254
Consumer Services 1.1%
Carnival plc	936	46,687
Compass Group plc	218,384	3,889,066
Domino's Pizza Group plc	274,810	3,694,725
Greene King plc	753,000	9,011,914
InterContinental Hotels Group plc	1,167	46,639
Merlin Entertainments plc (e)	3,460	21,856
TUI AG (g)	96,105	1,395,904
TUI AG (g)	2,409	34,967
Whitbread plc	890	50,447
William Hill plc	4,309	19,728
		18,211,933
Diversified Financials 0.7%
3i Group plc	4,699	32,593
Aberdeen Asset Management plc	4,498	19,678
Ashmore Group plc	758,210	3,407,437
Hargreaves Lansdown plc	1,260	23,723
ICAP plc	2,698	18,497
Investec plc	2,523	19,321
London Stock Exchange Group plc	1,529	60,735
Provident Financial plc	47,844	2,040,598
Schroders plc	138,701	5,105,904
Schroders plc, Non Voting Shares	1,100	31,438
		10,759,924
Energy 0.4%
BP plc	90,058	496,164
Petrofac Ltd.	1,154	14,297
Royal Dutch Shell plc, A Shares (g)	19,380	507,624
Royal Dutch Shell plc, A Shares (g)	201,112	5,312,953
Royal Dutch Shell plc, B Shares	19,484	511,550
		6,842,588
Food & Staples Retailing 0.0%
J. Sainsbury plc	6,505	27,522
Tesco plc *	40,120	100,863
WM Morrison Supermarkets plc	10,817	30,267
		158,652
Food, Beverage & Tobacco 0.8%
Associated British Foods plc	1,737	77,923
British American Tobacco plc	9,165	558,809
Coca-Cola HBC AG CDI *	966	19,801
Diageo plc	285,084	7,707,558
Greencore Group plc	765,260	4,038,421
Imperial Brands plc	4,698	255,445

See financial notes 51

Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
SABMiller plc	4,779	292,695
Tate & Lyle plc	2,172	18,700
		12,969,352
Health Care Equipment & Services 0.0%
Mediclinic International plc	1,955	25,867
Smith & Nephew plc	4,365	73,918
		99,785
Household & Personal Products 0.5%
Reckitt Benckiser Group plc	32,332	3,149,749
Unilever plc	93,134	4,161,401
		7,311,150
Insurance 0.3%
Admiral Group plc	41,773	1,135,333
Aviva plc	19,927	126,247
Direct Line Insurance Group plc	6,644	35,197
Hiscox Ltd.	68,459	902,340
Legal & General Group plc	29,316	95,802
Old Mutual plc	24,031	65,335
Prudential plc	133,623	2,637,655
RSA Insurance Group plc	4,959	33,311
St. James's Place plc	2,531	32,128
Standard Life plc	9,602	45,852
		5,109,200
Materials 2.9%
Anglo American plc	6,835	76,451
Antofagasta plc	1,862	13,187
BHP Billiton plc	10,401	142,125
Croda International plc	294,964	12,993,912
Elementis plc	1,198,341	3,781,582
Essentra plc	21,340	253,793
Fresnillo plc	1,068	17,409
Glencore plc *	7,416,152	17,723,998
Johnson Matthey plc	30,468	1,287,727
Mondi plc	1,774	33,980
Randgold Resources Ltd.	455	45,449
Rexam plc	3,438	31,443
Rio Tinto plc	6,112	205,035
RPC Group plc	481,458	5,137,793
Victrex plc	258,043	5,290,787
		47,034,671
Media 0.4%
ITV plc	402,144	1,325,571
Pearson plc	4,059	47,829
RELX plc	5,447	96,500
Sky plc	5,034	69,198
UBM plc	114,955	957,768
WPP plc	179,741	4,199,216
		6,696,082
Pharmaceuticals, Biotechnology & Life Sciences 0.1%
AstraZeneca plc	6,215	356,571
GlaxoSmithKline plc	23,928	511,400
		867,971
Real Estate 0.1%
Derwent London plc	16,357	786,153
Great Portland Estates plc	97,670	1,082,986
Hammerson plc	3,790	32,435
Intu Properties plc	4,571	20,355
Land Securities Group plc	3,855	63,852

Security	Number of Shares	Value ($)
Segro plc	3,502	21,397
The British Land Co., plc	4,746	49,935
		2,057,113
Retailing 0.1%
Dixons Carphone plc	4,729	29,438
Kingfisher plc	11,245	59,910
Marks & Spencer Group plc	8,017	49,730
Next plc	11,246	836,996
Sports Direct International plc *	1,266	7,142
WH Smith plc	19,647	481,312
		1,464,528
Semiconductors & Semiconductor Equipment 0.0%
ARM Holdings plc	6,925	95,052
Software & Services 0.9%
Auto Trader Group plc (e)	1,164,055	6,393,373
Micro Focus International plc	41,526	928,833
Moneysupermarket.com Group plc	102,524	470,956
Rightmove plc	54,200	3,063,125
Sophos Group plc (e)	802,740	2,411,062
The Sage Group plc	172,290	1,492,355
Worldpay Group plc *(e)	6,840	26,677
		14,786,381
Technology Hardware & Equipment 1.4%
Halma plc	667,363	8,709,656
Laird plc	1,173,307	5,973,061
Oxford Instruments plc	197,401	1,903,897
Spectris plc	240,188	6,408,072
		22,994,686
Telecommunication Services 0.1%
BT Group plc	41,653	269,998
Inmarsat plc	2,172	29,552
Vodafone Group plc	130,568	420,669
		720,219
Transportation 0.0%
easyJet plc	768	16,553
Royal Mail plc	4,388	31,254
		47,807
Utilities 0.0%
Centrica plc	24,999	87,302
National Grid plc	18,416	262,771
Severn Trent plc	1,144	37,295
SSE plc	4,945	109,252
United Utilities Group plc	3,372	46,369
		542,989
		272,928,591
United States 0.5%
Insurance 0.4%
Willis Towers Watson plc	51,526	6,435,597
Pharmaceuticals, Biotechnology & Life Sciences 0.1%
ICON plc *	23,933	1,617,392
		8,052,989
Total Common Stock
(Cost $1,468,612,029)		1,552,858,236

52 See financial notes

Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

Security	Number of Shares	Value ($)
Preferred Stock 0.6% of net assets
Germany 0.6%
Automobiles & Components 0.0%
Bayerische Motoren Werke AG	255	20,303
Porsche Automobil Holding SE	740	41,339
Volkswagen AG	914	132,587
		194,229
Capital Goods 0.2%
Jungheinrich AG	28,940	2,730,368
Health Care Equipment & Services 0.4%
Sartorius AG	25,300	6,252,192
Household & Personal Products 0.0%
Henkel AG & Co. KGaA	878	100,284
Materials 0.0%
Fuchs Petrolub SE	349	14,945
		9,292,018
Italy 0.0%
Banks 0.0%
Intesa Sanpaolo S.p.A. - RSP	4,119	10,850
Telecommunication Services 0.0%
Telecom Italia S.p.A. - RSP	29,383	23,112
		33,962
Total Preferred Stock
(Cost $8,110,129)		9,325,980

Other Investment Company 2.9% of net assets
Money Market Fund 2.9%
State Street Institutional U.S. Government Money Market Fund, Premier Class 0.23% (b)	46,600,332	46,600,332
Total Other Investment Company
(Cost $46,600,332)		46,600,332
Security Rate, Maturity Date	Face Amount ($)	Value ($)
Short-Term Investments 0.0% of net assets
U.S. Treasury Obligations 0.0%
U.S. Treasury Bills
0.29%, 06/23/16 (c)(d)	10,000	9,998
0.32%, 06/23/16 (c)(d)	11,000	10,998
0.33%, 06/23/16 (c)(d)	20,000	19,996
Total Short-Term Investments
(Cost $40,981)		40,992

End of Investments.

At 04/30/16, the tax basis cost of the fund's investments was $1,544,780,687 and the unrealized appreciation and depreciation were $173,435,620 and ($109,390,767), respectively, with a net unrealized appreciation of $64,044,853.

At 04/30/16, the values of certain foreign securities held by the fund aggregating $1,378,633,721 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)	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.
(e)	Securities exempt from registration under Rule 144A of the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registrations, normally to qualified institutional buyers. At the period end, the value of these amounted to $29,493,793 or 1.8% of net assets.
(f)	Illiquid security. At the period end, the value of these amounted to $40,756,313 or 2.5% of net assets.
(g)	Securities are traded on separate exchanges for the same entity.

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

AUD —	Australian dollar
CHF —	Swiss franc
NZD —	New Zealand dollar
SGD —	Singapore dollar
USD —	U.S. dollar

In addition to the above, the fund held the following at 04/30/16:

	Number of Contracts	Contract Value ($)	Unrealized Appreciation ($)
Futures Contracts
MSCI EAFE, e-mini, Long, expires 06/17/16	339	28,169,205	1,409,704

See financial notes 53

Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

Expiration
Date

Counterparty

Currency
to be
Received

Amount of
Currency
to be
Received

Currency
to be
Delivered

Amount of
Currency
to be
Delivered

Unrealized
Appreciation
(Depreciation)
($)

Forward Foreign Currency Exchange Contracts

12/21/2016

State Street Bank & Trust Co.

USD

1,189,182

AUD

1,578,000

(28,152)

09/21/2016

State Street Bank & Trust Co.

USD

12,378,989

CHF

11,798,000

(338,248)

07/29/2016

State Street Bank & Trust Co.

USD

13,383,190

NZD

19,252,500

(211,631)

05/04/2016

Barclays Capital, Inc.

USD

217,873

SGD

293,006

Net Unrealized Depreciation on Forward Foreign Currency Exchange Contracts

(578,001)

The following is a summary of the inputs used to value the fund's investments as of April 30, 2016 (see financial note 2(a) for additional information):

Assets Valuation Input

Description	Quoted Prices in Active Markets for Identical Assets (Level 1)	Other Significant Observable Inputs (Level 2)	Significant Unobservable Inputs (Level 3)	Total
Common Stock¹	$—	$380,189,081	$—	$380,189,081
Brazil ¹	11,639,134	—	—	11,639,134
Canada ¹	75,102,653	—	—	75,102,653
China ¹	—	24,048,867	—	24,048,867
Software & Services	15,878,340	2,622,897	—	18,501,237
France ¹	—	121,714,048	—	121,714,048
Capital Goods	4,534,417	15,376,485	—	19,910,902
Pharmaceuticals, Biotechnology & Life Sciences	4,048,234	6,405,459	—	10,453,693
Hong Kong¹	—	21,887,322	—	21,887,322
Consumer Services	4,941,069	3,702,352	—	8,643,421
Telecommunication Services	19,011	4,265,200	—	4,284,211
Ireland ¹	—	5,697,123	—	5,697,123
Capital Goods	736,807	—	—	736,807
Consumer Services	2,626,193	52,952	—	2,679,145
Food, Beverage & Tobacco	6,501,917	68,841	—	6,570,758
Israel ¹	—	3,245,688	—	3,245,688
Pharmaceuticals, Biotechnology & Life Sciences	2,160,530	246,869	—	2,407,399
Software & Services	4,125,428	16,685	—	4,142,113
Japan ¹	—	243,744,934	—	243,744,934
Banks	28,413	10,054,195	—	10,082,608
Mexico ¹	18,209,733	—	—	18,209,733
Netherlands ¹	—	9,666,009	—	9,666,009
Capital Goods	17,164	11,020,571	—	11,037,735
Food, Beverage & Tobacco	2,395,938	146,699	—	2,542,637
Household & Personal Products	351,922	—	—	351,922
Semiconductors & Semiconductor Equipment	3,057,373	3,615,506	—	6,672,879
Peru ¹	2,244,558	—	—	2,244,558

54 See financial notes

Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

Description	Quoted Prices in Active Markets for Identical Assets (Level 1)	Other Significant Observable Inputs (Level 2)	Significant Unobservable Inputs (Level 3)	Total
Singapore ¹	$—	$40,713,818	$—	$40,713,818
Capital Goods	2,366,450	142,296	—	2,508,746
South Africa¹	—	3,906,866	—	3,906,866
Food & Staples Retailing	448,359	—	—	448,359
Spain ¹	—	9,296,678	—	9,296,678
Banks	—	3,059,234	1,375	3,060,609
Sweden ¹	—	35,409,300	—	35,409,300
Capital Goods	5,374,464	26,357,196	—	31,731,660
Switzerland ¹	—	76,520,633	—	76,520,633
Capital Goods	2,047,931	10,398,764	—	12,446,695
Software & Services	422,417	4,077,318	—	4,499,735
Taiwan ¹	—	15,288,090	—	15,288,090
Semiconductors & Semiconductor Equipment	4,044,364	5,594,486	—	9,638,850
United Kingdom¹	—	203,890,894	—	203,890,894
Capital Goods	2,172,382	66,864,385	930	69,037,697
United States¹	8,052,989	—	—	8,052,989
Preferred Stock¹	—	9,325,980	—	9,325,980
Other Investment Company¹	46,600,332	—	—	46,600,332
Short-Term Investments¹	—	40,992	—	40,992
Total	$230,148,522	$1,378,674,713	$2,305	$1,608,825,540
Other Financial Instruments
Futures Contracts²	$1,409,704	$—	$—	$1,409,704
Forward Foreign Currency Exchange Contracts²	—	30	—	30
Liabilities Valuation Input

Other Financial Instruments
Forward Foreign Currency Exchange Contracts²	$—	($578,031)	$—	($578,031)

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.

In the above table for significant unobservable inputs (Level 3), amounts include investments determined to have no value at April 30, 2016. See the Portfolio Holdings footnote (Fair-valued by management in accordance with procedures approved by the Board of Trustees) for investment details.

See financial notes 55

Laudus International MarketMasters 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:

Investments in Securities	Balance as of October 31, 2015	Realized Gains (Losses)	Change in Unrealized Appreciation (Depreciation)	Gross Purchases	Gross Sales	Gross Transfers in	Gross Transfers out	Balance as of April 30, 2016
Common Stock
Australia	$58,035	$—	$1,617	$—	($59,652)	$—	$—	$—
Spain	22,567	—	(894)	1,333	(21,631)	—	—	1,375
United Kingdom	—	—	5	925	—	—	—	930
Preferred Stock
United Kingdom	2,185	(47)	—	—	(2,138)	—	—	—
Total	$82,787	($47)	$728	$2,258	($83,421)	$—	$—	$2,305

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 the period ended April 30, 2016. The transfers in the amount of $31,586,199 and $12,760,309 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 into Level 3 from Level 1 or Level 2 were due to the result of fair valued securities for which no quoted value was available.

56 See financial notes

Laudus International MarketMasters Fund

Statement of

Operations

For the period November 1, 2015 through April 30, 2016; unaudited

Investment Income
Dividends (net of foreign withholding tax of $1,525,334)		$15,028,773
Expenses
Investment adviser and administrator fees		10,796,659
Shareholder service fees:
Investor Shares		563,497
Select Shares		1,002,857
Custodian fees		541,128
Portfolio accounting fees		94,074
Transfer agent fees		73,623
Shareholder reports		55,291
Professional fees		41,897
Proxy fees		24,605
Registration fees		19,236
Independent trustees' fees		9,257
Interest expense		1,054
Other expenses	+	46,056
Total expenses		13,269,234
Expense reduction by CSIM and its affiliates	–	2,241,107
Net expenses	–	11,028,127
Net investment income		4,000,646
Realized and Unrealized Gains (Losses)
Net realized losses on investments (net of foreign capital gain tax paid of ($22))		(15,132,692)
Net realized gains on futures contracts		2,210,388
Net realized losses on foreign currency transactions	+	(153,892)
Net realized losses		(13,076,196)
Net change in unrealized appreciation (depreciation) on investments (net of change in foreign capital gain tax of ($1,138,481))		(42,019,447)
Net change in unrealized appreciation (depreciation) on futures contracts		1,979,686
Net change in unrealized appreciation (depreciation) on foreign currency translations	+	(712,746)
Net change in unrealized appreciation (depreciation)	+	(40,752,507)
Net realized and unrealized losses		(53,828,703)
Decrease in net assets resulting from operations		($49,828,057)

58 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
	11/1/15-4/30/16		11/1/14-10/31/15
Net investment income		$4,000,646	$18,349,960
Net realized gains (losses)		(13,076,196)	113,949,202
Net change in unrealized appreciation (depreciation)	+	(40,752,507)	(115,270,897)
Increase (decrease) in net assets from operations		(49,828,057)	17,028,265
Distributions to Shareholders
Distributions from net investment income
Investor Shares		(6,292,923)	(8,584,765)
Select Shares	+	(18,622,940)	(24,212,500)
Total distributions from net investment income		(24,915,863)	(32,797,265)
Distributions from net realized gains
Investor Shares		(28,099,826)	—
Select Shares	+	(72,880,802)	—
Total distributions from net realized gains		(100,980,628)	—
Total distributions		($125,896,491)	$—

Transactions in Fund Shares
		11/1/15-4/30/16		11/1/14-10/31/15
		SHARES	VALUE	SHARES	VALUE
Shares Sold
Investor Shares		457,200	$9,401,763	1,572,262	$36,357,838
Select Shares	+	3,581,553	73,447,938	11,333,727	263,224,442
Total shares sold		4,038,753	$82,849,701	12,905,989	$299,582,280
Shares Reinvested
Investor Shares		1,484,420	$30,682,952	358,089	$7,806,344
Select Shares	+	2,403,803	49,590,453	454,613	9,896,917
Total shares reinvested		3,888,223	$80,273,405	812,702	$17,703,261
Shares Redeemed
Investor Shares		(2,377,671)	($48,318,563)	(5,819,694)	($132,991,809)
Select Shares	+	(12,411,422)	(253,583,014)	(19,712,757)	(460,500,168)
Total shares redeemed		(14,789,093)	($301,901,577)	(25,532,451)	($593,491,977)
Net transactions in fund shares		(6,862,117)	($138,778,471)	(11,813,760)	($276,206,436)
Shares Outstanding and Net Assets
		11/1/15-4/30/16		11/1/14-10/31/15
		SHARES	NET ASSETS	SHARES	NET ASSETS
Beginning of period		85,036,528	$1,931,049,115	96,850,288	$2,223,024,551
Total decrease	+	(6,862,117)	(314,503,019)	(11,813,760)	(291,975,436)
End of period		78,174,411	$1,616,546,096	85,036,528	$1,931,049,115
Distributions in excess of net investment income/Net investment income not yet distributed			($5,208,401)		$15,706,816

See financial notes 59

Laudus MarketMasters Funds

Financial Notes, unaudited

1. Business Structure of the Funds:

Schwab Capital Trust (organized May 7, 1993)	Schwab Target 2010 Fund
Laudus Small-Cap MarketMasters Fund	Schwab Target 2015 Fund
Laudus International MarketMasters Fund	Schwab Target 2020 Fund
Schwab ^® S&P 500 Index Fund	Schwab Target 2025 Fund
Schwab Small-Cap Index Fund^®	Schwab Target 2030 Fund
Schwab Total Stock Market Index Fund^®	Schwab Target 2035 Fund
Schwab International Index Fund^®	Schwab Target 2040 Fund
Schwab MarketTrack All Equity Portfolio™	Schwab Target 2045 Fund
Schwab MarketTrack Growth Portfolio™	Schwab Target 2050 Fund
Schwab MarketTrack Balanced Portfolio™	Schwab Target 2055 Fund
Schwab MarketTrack Conservative Portfolio™	Schwab Fundamental US Large Company Index Fund
Schwab Balanced Fund™	Schwab Fundamental US Small Company Index Fund
Schwab Core Equity Fund™	Schwab Fundamental International Large Company Index Fund
Schwab Dividend Equity Fund™	Schwab Fundamental International Small Company Index Fund
Schwab Large-Cap Growth Fund™	Schwab Fundamental Emerging Markets Large Company Index Fund
Schwab Small-Cap Equity Fund™	Schwab Fundamental Global Real Estate 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
Schwab ^® International Core Equity Fund

Each fund in this report 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.

2. Significant Accounting Policies:

(a) Security Valuation:

Laudus MarketMasters Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

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

• Short-term securities (60 days or less to maturity): A short-term security may be valued at its amortized cost when it approximates the security's market value.

Laudus MarketMasters Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

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

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, 2016 are disclosed in the Portfolio Holdings.

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

Laudus MarketMasters Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

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 appreciation or depreciation arises 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.

(d) Investment Income:

(e) Expenses:

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:

(i) Federal Income Taxes:

Laudus MarketMasters Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

(j) Foreign Taxes:

(k) Indemnification:

3. Risk Factors:

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—bonds or large-cap and mid-cap stocks, for instance—the performance of a fund's investments in small-cap securities will lag these investments.

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—bonds and small-cap stocks, for instance—the performance of a fund's investment in large- and mid-cap securities will lag these investments.

Management Risk. As with all actively managed funds, a fund is subject to the risk that its investment adviser and investment managers will select investments or allocate assets in a manner that could cause the fund to underperform or otherwise not meet its objective. Poor stock selection or a focus on securities in a particular sector may cause a fund to underperform its benchmark or other funds with a similar investment objective.

Foreign Investment Risk. A fund's investments in securities of foreign issuers 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 restrictions 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 strategy. These risks may be heightened in connection with investments in emerging markets.

Laudus MarketMasters Funds

Financial Notes, unaudited (continued)

3. Risk Factors (continued):

Emerging Markets Risk. Emerging market countries may be more likely to experience political turmoil or rapid changes in market or economic conditions than more developed countries. Emerging market 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 developed 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, 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, market risk and management 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 large 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 initial amount invested.

Multi-Manager Risk. 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 fund may be unable to sell certain securities, such as illiquid securities, readily at a favorable time or price, or a fund may have to sell them at a loss.

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:

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:

% of Average Daily Net Assets	Laudus Small-Cap MarketMasters Fund	Laudus International 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%

For the period ended April 30, 2016, the aggregate advisory fee paid to CSIM by the Laudus Small-Cap MarketMasters Fund and the Laudus International MarketMasters Fund were 1.17% and 1.27%, respectively, as 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 a fund to bear expenses relating to the provision by financial intermediaries, including Charles Schwab & Co., Inc. (a broker-dealer affiliate of CSIM, Schwab) (together, “service providers”), of certain account maintenance, customer liaison and shareholder services to the current shareholders of the funds.

Laudus MarketMasters Funds

Financial Notes, unaudited (continued)

4. Affiliates and Affiliated Transactions (continued):

Pursuant to the Plan, each fund’s shares are subject to an annual shareholder servicing fee of up to 0.20% for Select Shares and 0.25% for Investor Shares. The shareholder servicing fee paid to a particular service provider is made pursuant to its written agreement with Schwab, as distributor of the funds (or, in the case of payments made to Schwab acting as a service provider, pursuant to Schwab’s written agreement with the funds), and a fund will pay no more than 0.20% for Select Shares and 0.25% for Investor Shares of the average annual daily net asset value of the fund shares owned by shareholders holding shares through such service provider. Payments under the Plan are made as described above without regard to whether the fee is more or less than the service provider’s actual cost of providing the services, and if more, such excess may be retained as profit by the service provider.

	Laudus Small-Cap MarketMasters Fund	Laudus International MarketMasters Fund
Investor Shares	1.35%	1.40%
Select Shares	1.20%	1.25%

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, 2016, as applicable:

	Underlying Funds
	Laudus Small-Cap MarketMasters Fund	Laudus International MarketMasters Fund
Schwab Target 2010 Fund	0.3%	0.2%
Schwab Target 2015 Fund	0.6%	0.4%
Schwab Target 2020 Fund	3.9%	2.5%
Schwab Target 2025 Fund	4.2%	2.5%
Schwab Target 2030 Fund	9.4%	5.2%
Schwab Target 2035 Fund	5.0%	2.5%
Schwab Target 2040 Fund	13.8%	6.5%
Schwab Target 2045 Fund	1.4%	0.6%
Schwab Target 2050 Fund	1.2%	0.5%
Schwab Target 2055 Fund	0.7%	0.3%
Schwab Monthly Income Fund - Moderate Payout	—%	0.4%
Schwab Monthly Income Fund - Enhanced Payout	—%	0.5%
Schwab Monthly Income Fund - Maximum Payout	—%	0.1%
Schwab Balanced Fund	18.6%	—%

Laudus MarketMasters 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 on each fund’s Statement of Operations. For information regarding the trustees, please refer to the Trustees and Officers table at the end of this report.

6. Borrowing from Banks:

7. Purchases and Sales/Maturities of Investment Securities:

For the period ended April 30, 2016, 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	$32,135,155	$37,296,048
Laudus International MarketMasters Fund	575,823,139	797,444,753

8. Derivatives:

The funds entered into equity index futures contracts during the report period. The funds invested in futures contracts to equitize available cash. The fair value and variation margin for futures contracts held at April 30, 2016 are presented on the Portfolio Holdings and Statement of Assets and Liabilities, respectively. The net realized and change in 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 ended April 30, 2016, 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	$978,263	9
Laudus International MarketMasters Fund	28,693,693	350

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 and to hedge exposure to certain currencies. 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 ended April 30, 2016, the month-end average forward foreign currency notional amount and the month-end average unrealized appreciation were $24,158,801 and $235,247 respectively.

Laudus MarketMasters Funds

Financial Notes, unaudited (continued)

8. Derivatives (continued):

As of April 30, 2016, the derivatives contracts held by the funds, categorized by primary risk exposure, were:

	Laudus Small-Cap MarketMasters Fund	Laudus International MarketMasters Fund
Asset Derivatives	Fair Value
Equity Index - Futures Contracts¹	$6,811	$1,409,704
Forward Foreign Currency Exchange Contracts²	—	30
Total	$6,811	$1,409,734
Liability Derivatives	Fair Value
Equity Index - Futures Contracts³	$—	$—
Forward Foreign Currency Exchange Contracts⁴	—	578,031
Total	$—	$578,031

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.

The effects of the derivatives held by the funds in the Statement of Operations for the period ended April 30, 2016 were:

	Laudus Small-Cap MarketMasters Fund	Laudus International MarketMasters Fund
Equity Index Futures Contracts
Realized Gains (Losses)¹	$2,012	$2,210,388
Change in Unrealized Appreciation (Depreciation)²	(59,170)	1,979,686
Forward Foreign Currency Exchange Contracts
Realized Gains (Losses)¹	$—	$14,390
Change in Unrealized Appreciation (Depreciation)²	—	(963,926)

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.

The funds' forwards 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

Laudus MarketMasters Funds

Financial Notes, unaudited (continued)

8. Derivatives (continued):

MarketMasters Fund's forwards, which are reported gross in the Statement of Assets and Liabilities, are presented in the table below. The following table presents the fund's forwards, 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, 2016.

		Gross Amounts Not Offset in the Statement of Assets & Liabilities
Counterparty	Net Amounts of Assets Presented in the Statement of Assets and Liabilities	Financial Instruments	Cash Collateral Received	Net Amounts^(a)
Barclays Capital, Inc.	$30	$—	$—	$30
Total	$30	$—	$—	$30
Counterparty	Net Amounts of Liabilities Presented in the Statement of Assets and Liabilities	Financial Instruments	Cash Collateral Pledged	Net Amounts^(b)
State Street Bank & Trust Co.	($578,031)	$—	$—	($578,031)
Total	($578,031)	$—	$—	($578,031)

^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.

9. Redemption Fee:

	Current Period (11/1/15-4/30/16)	Prior Period (11/1/14-10/31/15)
Laudus Small-Cap MarketMasters Fund	$108	$565
Laudus International MarketMasters Fund	7,262	10,335

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, 2015, the funds had no capital loss carryforwards.

11. Subsequent Events:

On June 1, 2016, the Board of Trustees of Schwab Capital Trust approved the termination of BMO Asset Management Corp. (BMO) as investment manager to the Laudus Small-Cap MarketMasters Fund (the Fund). The Board also approved the hiring of The Boston Company Asset Management, LLC (The Boston Company) as a new investment manager to the Fund. BMO will terminate managing Fund assets on or around June 9, 2016. The Boston Company will begin managing Fund assets on or around June 9, 2016.

Other than the investment manager changes to the Laudus Small-Cap MarketMasters Fund as discussed above, management has determined there are no other subsequent events or transactions through the date the financial statements were issued that would have materially impacted the financial statements as presented.

Trustees and Officers

Independent Trustees
Name, Year of Birth, and Position(s) with the trust (Terms of office, and length of Time Served¹)	Principal Occupations During the Past Five Years	Number of Portfolios in Fund Complex Overseen by the Trustee	Other Directorships
Robert W. Burns 1959 Trustee (Trustee of Schwab Strategic Trust since 2009; The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios and Laudus Trust since 2016)	Retired/Private Investor (Jan. 2009 – present). Formerly, Managing Director, Pacific Investment Management Company, LLC (PIMCO) and President, PIMCO Funds.	97	Director, PS Business Parks, Inc. (2005 – 2012)
John F. Cogan 1947 Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust and Schwab Annuity Portfolios since 2008; Laudus Trust since 2010; Schwab Strategic Trust since 2016)	Senior Fellow, The Hoover Institution at Stanford University (Oct. 1979 – present); Senior Fellow, Stanford Institute for Economic Policy Research (2000 – present); Professor of Public Policy, Stanford University (1994 – 2015).	97	Director, Gilead Sciences, Inc. (2005 – present)
Stephen Timothy Kochis 1946 Trustee (Trustee of Schwab Strategic Trust since 2012; The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios and Laudus Trust since 2016)	CEO and Owner, Kochis Global (wealth management consulting) (May 2012 – present); Chairman and CEO, Aspiriant, LLC (wealth management) (Jan. 2008 – Apr. 2012).	97	None
David L. Mahoney 1954 Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios and Laudus Trust since 2011; Schwab Strategic Trust since 2016)	Private Investor.	97	Director, Symantec Corporation (2003 – present) Director, Corcept Therapeutics Incorporated (2004 – present) Director, Adamas Pharmaceuticals, Inc. (2009 – present)
Kiran M. Patel 1948 Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios and Laudus Trust since 2011; Schwab Strategic Trust since 2016)	Retired. Executive Vice President and General Manager of Small Business Group, Intuit, Inc. (financial software and services firm for consumers and small businesses) (Dec. 2008 – Sept. 2013).	97	Director, KLA-Tencor Corporation (2008 – present)

Independent Trustees (continued)
Name, Year of Birth, and Position(s) with the trust (Terms of office, and length of Time Served¹)	Principal Occupations During the Past Five Years	Number of Portfolios in Fund Complex Overseen by the Trustee	Other Directorships
Kimberly S. Patmore 1956 Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2016)	Consultant, Patmore Management Consulting (management consulting) (2008 – present).	97	None
Charles A. Ruffel 1956 Trustee (Trustee of Schwab Strategic Trust since 2009; The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios and Laudus Trust since 2015)	Co-Chief Executive Officer, Kudu Investment Management, LLC (financial services) (Jan. 2015 – present); Partner, Kudu Advisors, LLC (financial services) (June 2008 – Jan. 2015); Advisor, Asset International, Inc. (publisher of financial services information) (Aug. 2008 – Jan. 2015).	97	None
Gerald B. Smith 1950 Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust and Schwab Annuity Portfolios since 2000; Laudus Trust since 2010; Schwab Strategic Trust since 2016)	Chairman, Chief Executive Officer and Founder of Smith Graham & Co. (investment advisors) (Mar. 1990 – present).	97	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 The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust and Schwab Annuity Portfolios since 2008; Laudus Trust since 2010; Schwab Strategic Trust since 2016)	Senior Consultant, Goldman Sachs & Co., Inc. (investment banking and securities firm) (Jan. 2008 – present); Partner, Colgin Partners, LLC (vineyards) (Feb. 1998 – present).	97	Board Member and Chairman of the Audit Committee, Isis Pharmaceuticals (1994 – present) Lead Independent Director and Chair of Audit Committee, OUTFRONT Media Inc. (2014 – present)

Interested Trustees
Name, Year of Birth, and Position(s) with the trust (Terms of office, and length of Time Served¹)	Principal Occupations During the Past Five Years	Number of Portfolios in Fund Complex Overseen by the Trustee	Other Directorships
Walter W. Bettinger II² 1960 Chairman and Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust and Schwab Annuity Portfolios since 2008; Schwab Strategic Trust since 2009; Laudus Trust since 2010)	Director, President and Chief Executive Officer, The Charles Schwab Corporation (Oct. 2008 – present); President and Chief Executive Officer (Oct. 2008 – present), Director (May 2008 – present), Charles Schwab & Co., Inc.; Director, Charles Schwab Bank (Apr. 2006 – present); and Director, Schwab Holdings, Inc. (May 2008 – present).	97	Director, The Charles Schwab Corporation (2008 – present)

Interested Trustees (continued)
Name, Year of Birth, and Position(s) with the trust (Terms of office, and length of Time Served¹)	Principal Occupations During the Past Five Years	Number of Portfolios in Fund Complex Overseen by the Trustee	Other Directorships
Marie A. Chandoha² 1961 Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2016)	Director, President and Chief Executive Officer (Dec. 2010 – present), Chief Investment Officer (Sept. 2010 – Oct. 2011), Charles Schwab Investment Management, Inc.; Trustee (Jan. 2016 – present), President, Chief Executive Officer (Dec. 2010 – present), and Chief Investment Officer (Sept. 2010 – Oct. 2011), Schwab Funds, Laudus Funds and Schwab ETFs; Director, Charles Schwab Worldwide Funds plc and Charles Schwab Asset Management (Ireland) Limited (Jan. 2011 – present); Global Head of Fixed Income Business Division, BlackRock, Inc. (formerly Barclays Global Investors) (Mar. 2007 – Aug. 2010).	97	None
Joseph R. Martinetto² 1962 Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2016)	Senior Executive Vice President and Chief Financial Officer, The Charles Schwab Corporation and Charles Schwab & Co., Inc. (July 2015 – present); Executive Vice President and Chief Financial Officer of The Charles Schwab Corporation and Charles Schwab & Co., Inc. (May 2007 – July 2015); Director, Charles Schwab & Co., Inc. (May 2007 – present); Director (Apr. 2010 – present) and Chief Executive Officer (July 2013 – Apr. 2015), Charles Schwab Bank; Director, Executive Vice President and Chief Financial Officer, Schwab Holdings, Inc. (May 2007 – present).	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 A. Chandoha 1961 President and Chief Executive Officer (Officer of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2010)	Director, President and Chief Executive Officer (Dec. 2010 – present), Chief Investment Officer (Sept. 2010 – Oct. 2011), Charles Schwab Investment Management, Inc.; Trustee (Jan. 2016 – present), President, Chief Executive Officer (Dec. 2010 – present), and Chief Investment Officer (Sept. 2010 – Oct. 2011), Schwab Funds, Laudus Funds and Schwab ETFs; Director, Charles Schwab Worldwide Funds plc and Charles Schwab Asset Management (Ireland) Limited (Jan. 2011 – present); Global Head of Fixed Income Business Division, BlackRock, Inc. (formerly Barclays Global Investors) (Mar. 2007 – Aug. 2010).
Mark Fischer 1970 Treasurer and Chief Financial Officer (Officer of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2013)	Treasurer and Chief Financial Officer, Schwab Funds, Laudus Funds and Schwab ETFs (Jan. 2016 – present); Assistant Treasurer, Schwab Funds and Laudus Funds (Dec. 2013 – Dec. 2015), Schwab ETFs (Nov. 2013 – Dec. 2015); Vice President, Charles Schwab Investment Management, Inc. (Oct. 2013 – present); Executive Director, J.P. Morgan Investor Services (Apr. 2011 – Sept. 2013); Assistant Treasurer, Massachusetts Financial Service Investment Management (May 2005 – Mar. 2011).

Officers of the Trust (continued)
Name, Year of Birth, and Position(s) with the trust (Terms of office, and length of Time Served³)	Principal Occupations During the Past Five Years
George Pereira 1964 Senior Vice President and Chief Operating Officer (Officer of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust and Schwab Annuity Portfolios since 2004; Laudus Trust since 2006; Schwab Strategic Trust since 2009)	Senior Vice President and Chief Financial Officer (Nov. 2004 – present), Chief Operating Officer (Jan. 2011 – present), Charles Schwab Investment Management, Inc.; Senior Vice President and Chief Operating Officer (Jan. 2016 – present), Treasurer and Chief Financial Officer, Laudus Funds (June 2006 – Dec. 2015); Treasurer and Principal Financial Officer, Schwab Funds (Nov. 2004 – Dec. 2015) and Schwab ETFs (Oct. 2009 – Dec. 2015); Director, Charles Schwab Worldwide Funds plc and Charles Schwab Asset Management (Ireland) Limited (Apr. 2005 – present).
Omar Aguilar 1970 Senior Vice President and Chief Investment Officer – Equities (Officer of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2011)	Senior Vice President and Chief Investment Officer – Equities, Charles Schwab Investment Management, Inc. (Apr. 2011 – present); Senior Vice President and Chief Investment Officer – Equities, Schwab Funds, Laudus Funds and Schwab ETFs (June 2011 – present); Head of the Portfolio Management Group and Vice President of Portfolio Management, Financial Engines, Inc. (May 2009 – Apr. 2011); Head of Quantitative Equity, ING Investment Management (July 2004 – Jan. 2009).
Brett Wander 1961 Senior Vice President and Chief Investment Officer – Fixed Income (Officer of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2011)	Senior Vice President and Chief Investment Officer – Fixed Income, Charles Schwab Investment Management, Inc. (Apr. 2011 – present); Senior Vice President and Chief Investment Officer – Fixed Income, Schwab Funds, Laudus Funds and Schwab ETFs (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 (Apr. 2006 – Jan. 2008).
David Lekich 1964 Chief Legal Officer and Secretary, Schwab Funds and Schwab ETFs Vice President and Assistant Clerk, Laudus Funds (Officer of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2011)	Senior Vice President (Sept. 2011 – present), Vice President (Mar. 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 (Apr. 2011 – present) and Chief Legal Officer (Dec. 2011 – present), Schwab Funds; Vice President and Assistant Clerk, Laudus Funds (Apr. 2011 – present); Secretary (May 2011 – present) and Chief Legal Officer (Nov. 2011 – present), Schwab ETFs.
Catherine MacGregor 1964 Vice President and Assistant Secretary, Schwab Funds and Schwab ETFs Chief Legal Officer, Vice President and Clerk, Laudus Funds (Officer of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios and Laudus Trust since 2005; Schwab Strategic Trust since 2009)	Vice President, Charles Schwab & Co., Inc., Charles Schwab Investment Management, Inc. (July 2005 – present); Vice President (Dec. 2005 – present), Chief Legal Officer and Clerk (Mar. 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	Each Trustee shall hold office until the election and qualification of his or her successor, or until he or she dies, resigns or is removed. The retirement policy requires that each independent trustee retire by December 31 of the year in which the Trustee turns 74 or the Trustee’s twentieth year of service as an independent trustee on any trust in the Fund Complex, whichever occurs first.
²	Mr. Bettinger, Ms. Chandoha, and Mr. Martinetto 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/Clerk 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.

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.

cap, capitalization See “market cap.”

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

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.