Prediction: These 2 Schwab ETFs Will Crush the Nasdaq in 2025

You don’t have to pick individual stocks to outperform the stock market. A single ETF can do the trick, and Schwab has a few options to consider. While the financial firm offers funds that produce passive income and minimize risk, other Schwab ETFs embrace the future and can potentially outperform the Nasdaq in 2025 and beyond.

These are the two Schwab ETFs that can produce elevated returns. Both have exposure to artificial intelligence, a technology that is expected to revolutionize the world. 

Schwab US Large-Cap Growth ETF (SCHG)

The Schwab US Large-Cap Growth ETF (NYSEARCA:SCHG | SCHG Price Prediction) is a standard pick for investors who want to outperform the Nasdaq Composite. SCHG is up by 104% over the past five years, which exceeds the Nasdaq Composite’s 83% gain over the past five years. 

The fund only has a 0.04% expense ratio, so you don’t have to pay much to accumulate shares. In return, you get an ETF that has produced an annualized 17.6% gain over the past decade. Although the fund contains more than 200 stocks, the top 10 holdings are doing most of the world. SCHG allocates 58% of its capital to those positions, and fan-favorites like Nvidia (NASDAQ:NVDA), Microsoft (NASDAQ:MSFT), and Apple (NASDAQ:AAPL) are the ringleaders. Those three stocks make up more than 30% of SCHG’s total assets. 

Outsized exposure to the Magnificent Seven stocks has been a winning formula for many years. Apple is the only stock in SCHG’s top 10 that has not outperformed the Nasdaq Composite over the past year. Picking the top-performing stocks and concentrating on those assets has been a winning formula for this Schwab ETF.

Schwab Crypto Thematic ETF (STCE)

The Schwab Crypto Thematic ETF (NYSEARCA:STCE) has a 0.30% expense ratio, but it has the potential to crush the Nasdaq Composite and SCHG over the next few years. This fund does not offer direct exposure to cryptocurrencies, but it contains several stocks that will benefit from the rising demand for cryptocurrencies.

The fund is new, but an 80% return over the past year should be enough to captivate investors’ imaginations. Past results don’t guarantee future outcomes, but a focus on crypto miners suggests more returns may be on the way.

STCE’s top three holdings are IREN (NASDAQ:IREN), Cipher Mining (NASDAQ:CIFR), and Hut 8 (NASDAQ:HUT). Crypto miners are uniquely positioned to capitalize on the next AI wave due to their vast infrastructure. CoreWeave (NASDAQ:CRWV) used to be a crypto miner, but a recent shift to AI has resulted in a $50 billion market cap. CoreWeave came close to a $100 billion market cap during its peak, and it can reach that level again. 

The three top crypto miners have market caps below $7 billion, and they’re not the only attractive holdings in STCE. Only one stock in its top 10 holdings has underperformed the Nasdaq Composite over the past year. Four of the top five holdings are up by more than 100% over the past year. That also applies to six of the top 10 stocks on STCE.