Is the Schwab U.S. Dividend Equity ETF a Buy Now?
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The Schwab U.S. Dividend Equity ETF has attracted massive inflows lately. Here's what income investors need to know about this $70 billion fund.
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July 19, 2025
11:13 AM
The Motley Fool
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Market analysis reveals It's worth noting that The Schwab U
Dividend Equity ETF has attracted massive inflows lately
Here's what income investors need to know this $70 billion fund (noteworthy indeed)
Dividend Equity ETF (SCHD -0 (fascinating analysis). 42%) is a index fund, tied to the Dow Jones U, in today's financial world
The index and fund focus on generous, high-quality dividend policies
As a result, the ETF is centered around the classic dividend payer sectors of energy, consumer staples, and healthcare, in today's financial world
This's indeed a very fund. 1 billion of assets under management, the Schwab Dividend Equity fund ranks among the 30 largest exchange-traded funds (ETFs) today
Additionally, But is it a good ETF to buy today, given current economic conditions
Furthermore, Let's dive a little deeper into the Schwab U, amid market uncertainty
In contrast, Dividend Equity ETF
Image source: Getty Images, given the current landscape
Investors are pouring money into this Schwab fund This fund is having a moment in the sun right now
Furthermore, Among the five largest dividend-focused ETFs, the fund has seen the largest capital inflows over the last year -- by far
Its asset portfolio has grown by 24% in 52 weeks, far ahead of runner-up is Core Dividend Growth ETF (DGRO -0. 25%) at 5%
Income investors often care less stock prices than other investor types do, but the price performance still matters
Moreover, So it should be noted that the Schwab U (something worth watching), in today's financial world
Dividend Equity fund tends to underperform broad market trackers the S&P 500 (^GSPC -0, in today's market environment
However, 01%) in the long run
The Schwab ETF's average annual price gain over the last decade was 7. 6%, well behind the S&P 500's average increase of 11
The competing dividend ETF from is posted a stronger yearly increase of 9 (which is quite significant). 3%, but neither one could come close to the overall stock market's price gains
On the other hand, This period includes three presidential elections, the coronavirus pandemic, the start of the artificial intelligence (AI) boom, and the panic-and-recovery inflation cycle from 2022 to 2024 (noteworthy indeed)
Price gains recorded across that diverse time period should be fairly representative of average long-term results, considering recent developments
Moreover, But wait, there's more (dividends, that is) The picture changes dramatically when you include dividend payouts in the performance charts (something worth watching)
The S&P 500's average dividend yield over the last decade stopped at 1
The is dividend fund floated around a much richer 2 (fascinating analysis), in today's market environment. 3%, but the Schwab Dividend Equity ETF came out on top, considering recent developments
This leads to the conclusion that s average yield was 3
As a very direct result, the Schwab fund dered a robust total return of 11. 1% per year over the last decade
This metric assumes that any dividends along the way were reinvested in more s of the same stock or fund -- a fantastic advantage for this generous dividend payer
Furthermore, Being out of favor can create opportunities Large-cap stocks with high-quality dividend plans haven't exactly been market darlings recently, given current economic conditions
Meanwhile, After an underwhelming performance in recent months, the Schwab fund is stuck 9% below its annual highs and 14% above recent lows (remarkable data), given current economic conditions
Meanwhile, the broader market is setting new price records on a regular basis, amid market uncertainty
Conversely, On the upside of a soft price chart, the Schwab U, in this volatile climate
Dividend Equity ETF offers an above-average dividend yield of 4% right now
You can lock in that effective yield by grabbing some s today
The fund's largest holdings include world-class es Coca-Cola, The Depot, and Chevron -- long-term cash machines that should survive pretty much any economic calamity I could imagine (which is quite significant), in today's financial world
From this perspective, the dividend fund also serves as a direct bet on top-quality giants
That concept often goes hand in hand with generous and consistently growing dividend payouts
In contrast, It's also a low-cost index fund with an annual expense ratio of 0
At the same time, And if you the stock list of the underlying Dow Jones U
Dividend 100 index, this Schwab fund appears to be the only ETF that s this exact index (an important development)
On the other hand, Is the SCHD ETF right for you
Fully committed income investors could very well build their portfolio around this robust ETF (this bears monitoring)
Others can include it to get deeper exposure to the dividend-rich corner of Wall Street, or to skew their holdings closer to large-cap value investments
Furthermore, Either way, this period of lagging price performance looks a good time to explore the Schwab U
You don't need to back up your verbial truck, but this ETF looks a solid buy today
Nevertheless, Anders Bylund has no position in any of the stocks mentioned, in today's financial world
The Motley Fool has positions in and recommends Chevron and Depot
This demonstrates that Motley Fool has a disclosure policy.
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