The Schwab U.S. Dividend Equity ETF (SCHD) is an exchange-traded fund (ETF) managed by Charles Schwab Investment Management. The ETF seeks to track the performance of the Dow Jones U.S. Dividend 100 Index, which is composed of 100 high dividend-yielding U.S. stocks. SCHD primarily invests in large-cap U.S. companies that have a consistent track record of paying dividends, making it a popular choice for income-seeking investors.
SCHD Fund began in Oct 2011, total assets under its management is over 46 billion dollars.
Its shares outstanding 6.3 million shares.
CUSIP 808524797.
SCHD's investment objective is to provide investment results that, before fees and expenses, correspond generally to the total return of the underlying index. The ETF follows a passive investment strategy, aiming to replicate the performance of the Dow Jones U.S. Dividend 100 Index by holding the same securities in approximately the same proportions as the index.
The SCHD portfolio is well-diversified across various sectors, including consumer staples, health care, technology, financials, and industrials. This diversification helps to spread the risk associated with investing in individual stocks and offers exposure to various sectors of the U.S. economy.
Some key features of the Schwab U.S. Dividend Equity ETF include:
Diversification: SCHD offers investors diversified exposure to high-quality dividend-paying U.S. stocks, helping to spread the risk associated with investing in individual securities.
Low expense ratio: SCHD has a low expense ratio compared to other dividend-focused ETFs, making it an attractive option for cost-conscious investors.
Income potential: The ETF focuses on high-dividend-yielding companies, making it a suitable choice for investors seeking income in addition to potential capital appreciation.
Accessibility: SCHD is traded on major stock exchanges, allowing investors to buy and sell shares easily during trading hours.
Its total holdings is 104 stocks.
Here is a list of the top ten holdings of SCHD:
BLK
AVGO
CSCO
KO
LMT
MRK
PEP
TXN
HD
VZ
Of the all eleven sectors of S&P 500, SCHD preferred Information technology sector and FInancials sector than the others.
Considering its diversification, low risk, high dividend yield, SCHD is one of the best ETFs. Some people have been collecting SCHD for years.
Objective
The fund’s goal is to track as closely as possible, before fees and expenses, the total return of the Dow Jones U.S. Dividend 100 Index.
Whenever SCHD pulls back, you just a couple of shares. Never sell SCHD. You will receive dividend payments on a quarterly basis.
You can also use sell put options strategy to buy SCHD.
For example, if the current price of SCHD is $73.16, you can sell the put options of next month, strike price of $70, and you will get a premium of about $300.
If the price of SCHD never drops below $70 before the option expiration date, you will receive the premium of $300.
If the price of SCHD drops below $70, you will get 100 shares of SCHD at $70, plus $300 premium.
Therefore, your cost of buying 100 shares of SCHD is about $67 per share.
If you want to get rich quickly, SCHD might not be what you need.
However, if you want to receive stable dividend payments, SCHD is a good choice for you.
Before investing in SCHD or any other ETF, it is important to consider factors such as investment goals, risk tolerance, and time horizon. Additionally, investors should be aware of the potential risks associated with investing in equity securities, including market volatility, changes in dividend policies, and fluctuations in the value of the underlying securities. Conducting thorough research and understanding the fundamentals of the ETF can help investors make informed decisions about their investment portfolios.
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