Schwab U.S. Dividend Equity ETF ( NYSEARCA:SCHD ) costs $6 a year on a $10,000 investment, holds 100 dividend stocks, and currently yields 3.39%.
The growth style of investing was one of the most successful themes from 2023-2025. That has changed this year.
Tech and growth ETFs are constantly changing, and it's hard to keep up with them.
The Schwab U.S. Dividend Equity ETF represents 101 high-quality dividend stocks under a single ticker symbol. Unlike many stock-market ETFs, it has limited exposure to technology stocks.
FDVV carries a higher expense ratio but has delivered stronger 1-year and 5-year total returns than SCHD SCHD offers a higher dividend yield at 3.4% and more defensive sector exposure, with Consumer Defensive at 19% FDVV tilts toward technology and financials while SCHD leans into energy and consumer defensive stocks
The Schwab U.S.
Macro and geopolitical worries are rising, and even a “safe haven” like gold has not been spared from the wave of recent choppiness.
I'm upgrading SCHD due to its advantageous exposure to energy, defense, and consumer staples amid the Middle East conflict. SCHD holds 22% in energy and 68% in sectors resilient to oil shocks, positioning it to benefit from elevated oil prices and market volatility. The fund's low beta (0.62) and reasonable valuation (22.5x P/E) make SCHD attractive for downside protection during heightened geopolitical risk.
SCHD has pulled in nearly $800 million in net inflows in a single week this February, and income investors are rotating toward dividend growers as bond yields soften and volatility climbs.
SCHD gets most of the attention in dividend ETF conversations, and for good reason.
The 4-Factor Dividend Growth Portfolio, a rules-based alternative to SCHD, targets high-quality, growth-oriented dividend stocks using four equally weighted metrics. Since inception, the strategy has delivered a 14.17% annualized return, maintaining a 2.12% annualized outperformance over SCHD despite recent SCHD momentum. The portfolio emphasizes strong free cash flow, robust dividend growth, high return on invested capital, and above-average yields, with low monthly turnover.
Schwab US Dividend Equity ETF has outpaced peer dividend ETFs due to its allocation to the Energy sector. As the AI market demands more power, SCHD is directly aligned to provide investors with the 'picks and shovels' of this growth. The focus on energy has allowed SCHD to remain more defensive than the S&P 500 and Nasdaq-100 while also remaining resilient to the uncertainty of technology.