New York, July 10, 2026, 09:09 EDT
Schwab U.S. Dividend Equity ETF NYSEARCA:SCHD landed on three separate new lists released from July 8 to Friday, the only fund to do so after a strong first half that topped the broad U.S. market. The lists may signal agreement on income, but dig deeper and it looks more like a sector shift out of mega-cap tech.
U.S. cash markets were still closed. S&P 500 futures held flat, Nasdaq futures slipped 0.3%. Justin Onuekwusi, chief investment officer at St. James’s Place LON:STJ, said the focus on chip stocks and AI had led to “real distortion and dispersion in markets.” Reuters
Both lists include SCHD, but there’s little overlap beyond that.
| Source and date | Funds named | Portfolio role |
|---|---|---|
| Morningstar NASDAQ:MORN, July 8 | SCHD; Dimensional International Value ETF (NYSEARCA:DFIV); Vanguard Short-Term Treasury ETF (NASDAQ:VGSH) | U.S. dividend stocks, international value, and short-term Treasuries |
| Yahoo Finance/Fool, July 9 | SCHD; iShares Core High Dividend ETF (NYSEARCA:HDV); JPMorgan Equity Premium Income ETF NYSEARCA:JEPI | High yield stocks, plus options-based payouts |
| Motley Fool, July 10 | SCHD; SPDR S&P Dividend ETF (NYSEARCA:SDY); iShares Core Dividend Growth ETF NYSEARCA:DGRO | Stock picks focused on dividend consistency and raises |
SCHD reported net assets of about $98.0 billion and 103 holdings as of July 9, according to fund data. For the first half, its market-price total return came in at 17.50%, topping SPDR S&P 500 ETF Trust NYSEARCA:SPY, which returned 10.02%. That’s a difference of 7.48 percentage points. SCHD’s 30-day SEC yield, the standard annualised gauge of recent net investment income, isn’t as strong when stacked against Treasury yields.
| Metric | SCHD | SPY | Two-year U.S. Treasury |
|---|---|---|---|
| First-half total return | 17.50% | 10.02% | — |
| SEC yield or market yield | 3.31% | 0.96% | 4.16% |
| Technology weight | 11.07% | 37.60% | — |
| Top 10 holdings | 41.70% | 37.25% | — |
| Annual expense ratio | 0.060% | 0.0945% | — |
Returns run through June 30. Fund yields shown are from July 8, and the Treasury yield is from July 9. SCHD sector weights reflect March 31, while SPY sector weights and both top-10 stats use July 9 data from the sponsor.
SCHD’s SEC yield sits at 3.31%, 85 basis points under the two-year Treasury. One basis point is 0.01 percentage point. The numbers aren’t a perfect match, but the difference stands out. Investors are taking on equity risk and hoping for dividend growth or price gains, instead of just chasing near-term yield.
The sector split is where the differences really show. SCHD is 26.53 percentage points underweight tech compared to SPY. It carries 14.85 points more in consumer staples, 9.79 more in healthcare, and 13.82 more in energy. Top 10 holdings make up 41.70% of SCHD’s assets—more than SPY, which has 37.25%. It shifts the concentration, but doesn’t dilute it.
The picks highlight just how much income trade options can vary. Sponsor data shows the four funds land all over the map on yield, fees and portfolio setup.
| Fund | Portfolio design | 30-day SEC yield | Annual fee |
|---|---|---|---|
| SCHD | Picks dividend stocks screened for quality | 3.31% | 0.060% |
| HDV | Targets high dividends, includes a financial-strength filter | 3.14% | 0.080% |
| DGRO | Focuses on dividend growers; holds 390 names | 1.98% | 0.080% |
| JEPI | Mix of stocks and option income strategies | 8.20% | 0.350% |
JEPI pays an 8.20% yield, but this isn’t strictly a dividend. It gets most of that payout from selling options, taking in premiums from buyers while giving up some upside if the market runs higher. HDV is the most similar ETF if you want a pure play on high dividends. DGRO doesn’t yield as much, but it holds more names and leans harder towards dividend growth than current income.
The rotation could stall. If AI spending and tech gains keep pushing the index higher, SCHD’s lack of tech exposure could hurt it. Baird strategist Ross Mayfield called it “still very much an AI bull market.” Rising rate bets would make Treasuries more attractive, and weaker cash flow could mean dividend cuts in the stocks SCHD holds. Reuters
Morningstar bringing in DFIV and VGSH points to the limits of a single-fund change. The two bring foreign-value stocks and short-term government bonds, things investors don’t get with SCHD alone. With the current data, SCHD is cheap and works as a sector rotation trade with a yield, but it’s no Treasury stand-in and doesn’t reduce portfolio clustering.
