Schwab's SCHD Exchange Traded Fund is an excellent choice for those looking for exposure to Fundamentally Weighted Large Cap US Equities. It tracks the Dow Jones U.S. Dividend 100 Total Return Index - USD and offers both physical exposure and dividend distributions.
This fund will give investors the chance to invest in stocks that pay a quarterly dividend. This means that investors will receive income every three months in addition to the total return they earn in the stock market.
The SCHD Quarterly Income ETF (SCHD) is a mutual fund that invests in stocks that have consistently paid dividends. The fund has a yield of 3.25% and recently paid $2.43 per share in dividends. SCHD pays dividends every three months. Investors interested in dividend growth should consider SCHD as an alternative to VYM.
The Schwab US Dividend Equity ETF (SCHD) has been giving dividends to investors since its creation in 1999. It has been a great way to increase one's income and diversify his or her investments. The fund also reinvests dividends, which means that you can increase your capital and income without sacrificing a high dividend yield. The SCHD Income ETF also has a low expense ratio, making it an excellent investment for those with limited investment budgets.
The Dividend SCHD ETF tracks a market-cap-weighted index of 100 US equities with a minimum 10-year history of distributing dividends. The selection universe includes only quality companies with stable dividends and employs fundamental screens to create its portfolio. SCHD has a modest large-cap tilt, and excludes REITs and other REIT-related securities. Additionally, the fund limits its allocation to sectors and REIT-related companies to 25% of its portfolio. The overall composition of the fund is evaluated annually.
The SCHD fund has generally performed well this year, even though it was underperforming last month so was the whole market. While tech companies generally outperform, the fund's idiosyncrasies are in its underlying holdings and index methodology. Throughout 2020, for instance, it was dominated by Home Depot (HD), which did very well during the coronavirus pandemic, as home renovations grew in popularity. The SCHD fund also did well during the recent recession, which reflected increased demand for home renovation products.
Why Invest In SCHD
The fund tracks a market-cap-weighted index of 100 US equities with dividend payouts. The fund's selection universe only includes firms with at least a 10-year history of dividend payments. It also uses fundamental screens to build its portfolio. The fund has a modest large-cap tilt because it focuses on quality companies with sustainable dividends. The fund also excludes REITs and REIT-like securities. It also has strict composition rules, which require it to follow specific guidelines. Its dividend yield is too low to make the fund a meaningful source of income. But that isn't the reason most people buy SCHD.
Be sure to check out my favorite monthly dividend paying ETF JEPI.