July 16, 2012

Schwab Marks Milestone With OneSource Mutual Fund Platform

20th anniversary to be celebrated with white paper, interviews with Chuck

Charles Schwab is celebrating 20 years of offering its OneSource Mutual Fund Platform with the release of “Schwab’s Mutual Fund OneSource at 20,” a report that looks back at the evolution of the service and how it “simplifies the way investors buy and sell no-load mutual funds from multiple fund families without paying transaction fees.”

Unveiled in July 1992 with eight fund families and 80 mutual funds, the platform “revolutionized mutual fund investing for millions of individual investors and registered investment advisors (RIAs), and today provides access to more than 430 fund families and 4,400 no-load, no-transaction-fee funds,” according to the company.

“There are many facets of mutual fund investing that we take for granted today. We forget that access to funds and fund information wasn’t always so easy,” Doug Hanson, Charles Schwab’s vice president who oversees the company’s third-party mutual fund platforms. “The 20th anniversary of the Mutual Fund OneSource platform seemed like an ideal time to reflect on how far mutual fund investing and investors have come.”

The company notes that in 1992, only 27% of all U.S. households owned any type of mutual fund, and “there was no easy way for investors to gather information about, invest in or track the performance of mutual funds.”  Mutual Fund OneSource grew from $1.6 billion that first year to $214 billion today. According to the Investment Company Institute, 52.3 million households, or 44% of U.S. households, now own mutual funds. 

Drawing on interviews with company founder and chairman Chuck Schwab, Schwab employees, fund companies and other third parties, the new report recalls the hurdles facing Mutual Fund OneSource in simplifying mutual fund investing, including:

  • The challenge of communicating the platform concept to mutual fund families.
  • The important part RIAs played in the early success of Mutual Fund OneSource.
  • The role of technology in making fund research available to the average investor.
  • The evolution of the Mutual Fund OneSource Select List, a concise list of carefully pre-screened mutual funds, which was introduced in 1993.

 

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