Schwab U.S. Dividend Equity ETF (SCHD): Complete Beginner's Guide
Schwab U.S. Dividend Equity ETF (SCHD) is a u.s. large-cap dividend ETF from Charles Schwab with an expense ratio of 0.06% and $62.0B in assets under management. Our Beginner Suitability Score: 9/10 (Great for Beginners). 5-year annualized return: 12.10%.
Last updated: April 2026
Charles Schwab • U.S. Large-Cap Dividend
Expense Ratio
0.06%
AUM
$62.0B
Dividend Yield
3.40%
Inception
2011
Beginner Score
9/10
What is Schwab U.S. Dividend Equity ETF?
SCHD focuses on high-quality U.S. companies with strong track records of paying and growing dividends. It uses a rules-based approach to select about 100 stocks that have consistently paid dividends for at least 10 years. Beginners who want both income and growth often find SCHD attractive because it combines a solid dividend yield with quality stock selection at a very low cost.
SCHD is managed by Charles Schwab and has been available since 2011. With $62.0B in assets under management, it's a well-established fund with strong institutional backing. The fund charges an expense ratio of 0.06%, which means for every $10,000 you invest, you pay approximately $6 per year in management fees.
SCHD at a Glance — Key Metrics
| Expense Ratio | 0.06% |
| Total Holdings | 103 |
| P/E Ratio | 16.8 |
| Beta | 0.82 |
| Dividend Yield | 3.40% |
| AUM | $62.0B |
| Inception Year | 2011 |
| Issuer | Charles Schwab |
Top 10 Holdings in SCHD
SCHD holds 103 different securities. Here are the largest positions that make up the core of this fund:
| # | Company | Ticker | Weight |
|---|---|---|---|
| 1 | AbbVie Inc. | ABBV | 4.30% |
| 2 | Coca-Cola Co. | KO | 4.20% |
| 3 | Cisco Systems Inc. | CSCO | 4.10% |
| 4 | BlackRock Inc. | BLK | 4.10% |
| 5 | Texas Instruments Inc. | TXN | 4.00% |
| 6 | Home Depot Inc. | HD | 3.90% |
| 7 | Verizon Communications Inc. | VZ | 3.80% |
| 8 | PepsiCo Inc. | PEP | 3.70% |
| 9 | Amgen Inc. | AMGN | 3.70% |
| 10 | Chevron Corp. | CVX | 3.60% |
SCHD's top holding is AbbVie Inc. (ABBV) at 4.30%, followed by Coca-Cola Co. (KO) at 4.20% and Cisco Systems Inc. (CSCO) at 4.10%. The top 10 holdings account for 39.40% of the fund's 103 total positions.
View data table
| Rank | Company | Ticker | Weight |
|---|---|---|---|
| 1 | AbbVie Inc. | ABBV | 4.30% |
| 2 | Coca-Cola Co. | KO | 4.20% |
| 3 | Cisco Systems Inc. | CSCO | 4.10% |
| 4 | BlackRock Inc. | BLK | 4.10% |
| 5 | Texas Instruments Inc. | TXN | 4.00% |
| 6 | Home Depot Inc. | HD | 3.90% |
| 7 | Verizon Communications Inc. | VZ | 3.80% |
| 8 | PepsiCo Inc. | PEP | 3.70% |
| 9 | Amgen Inc. | AMGN | 3.70% |
| 10 | Chevron Corp. | CVX | 3.60% |
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SCHD Performance History
Here's how SCHD has performed over different time periods. Remember that past performance doesn't guarantee future results, but it gives you a sense of the fund's track record:
YTD
1.80%
1 Year
12.90%
3 Year
7.20%
5 Year
12.10%
10 Year
11.50%
SCHD has returned 12.10% annualized over 5 years and 11.50% over 10 years. YTD return is 1.80%.
View data table
| Period | Return |
|---|---|
| YTD | 1.80% |
| 1 Year | 12.90% |
| 3 Year | 7.20% |
| 5 Year | 12.10% |
| 10 Year | 11.50% |
Beginner Suitability Score: 9/10
Our proprietary Beginner Suitability Score evaluates ETFs based on five factors that matter most to new investors: fees, volatility, diversification, dividend history, and track record length.
SCHD scores 9/10 because it has very low fees, shows lower-than-average volatility, offers broad diversification across 103 holdings, and has been available since 2011, giving it a proven track record.
How to Buy SCHD — Step by Step
- Open a brokerage account — We recommend Fidelity, Charles Schwab, or Vanguard for ETF investing. All offer $0 commissions on ETF trades.
- Fund your account — Transfer money from your bank. You can start with as little as $1 if your broker offers fractional shares.
- Search for "SCHD" — Use the search bar in your brokerage platform to find Schwab U.S. Dividend Equity ETF.
- Place your order — Choose "Market Order" for simplicity or "Limit Order" if you want to set a specific price. Enter how many shares (or dollar amount) you want to buy.
- Set up automatic investing — Most brokers let you schedule recurring purchases (e.g., $100/month on the 1st). This is dollar cost averaging in action.
SCHD Sector Allocation
Here's how SCHD distributes its investments across different sectors of the economy:
SCHD's largest sector allocation is Financials at 18.8%, followed by Health Care at 15.5% and Consumer Staples at 14.0%.
View data table
| Sector | Weight |
|---|---|
| Financials | 18.8% |
| Health Care | 15.5% |
| Consumer Staples | 14.0% |
| Industrials | 12.5% |
| Information Technology | 11.2% |
| Energy | 9.8% |
| Consumer Discretionary | 6.8% |
| Communication Services | 5.8% |
| Materials | 3.5% |
| Utilities | 2.1% |
Dollar Cost Averaging Into SCHD
Here's what consistent monthly investing could look like over time, assuming an average annual return of 8% (approximate historical stock market average):
| Monthly | 10 Years | 20 Years | 30 Years |
|---|---|---|---|
| $100/mo | $18,417 | $59,295 | $150,030 |
| $250/mo | $46,041 | $148,237 | $375,074 |
| $500/mo | $92,083 | $296,474 | $750,148 |
*Projections assume 8% average annual return with monthly compounding. Actual returns will vary. Past performance doesn't guarantee future results.
Fee impact: With SCHD's expense ratio of 0.06%, a $10,000 investment would lose approximately $515 to fees over 20 years compared to a zero-fee investment. This is a reasonable fee level for the value provided.
SCHD's expense ratio of 0.06% costs $516 on a $10,000 investment over 20 years (assuming 8% annual return). Without fees, the investment would grow to $46,610 instead of $46,094.
View data table
| Year | Without Fees | With Fees | Fee Cost |
|---|---|---|---|
| 0 | $10,000 | $10,000 | $0 |
| 5 | $14,693 | $14,653 | $40 |
| 10 | $21,589 | $21,470 | $119 |
| 15 | $31,722 | $31,458 | $264 |
| 20 | $46,610 | $46,094 | $516 |
Pros and Cons of SCHD
Pros
- ✓Attractive 3.4% dividend yield from high-quality companies with proven dividend histories
- ✓Very low 0.06% expense ratio makes it one of the cheapest dividend ETFs
- ✓Lower volatility than the broad market due to quality-focused stock selection
- ✓Strong dividend growth rate means your income stream increases over time
Cons
- ✗Tends to underperform in strong growth-driven bull markets since it excludes high-flying tech stocks
- ✗Only about 100 holdings means less diversification than total market funds
- ✗Excludes REITs, which limits real estate dividend exposure
SCHD vs Similar ETFs
See how SCHD stacks up against similar funds:
Frequently Asked Questions
Is SCHD a good ETF for beginners?▾
SCHD has a Beginner Suitability Score of 9/10 on our scale. This makes it a strong choice for new investors due to its low fees and broad diversification.
What is the expense ratio of SCHD?▾
SCHD has an expense ratio of 0.06%. This means for every $10,000 you invest, you pay approximately $6 per year in fees. This is considered very low and cost-efficient.
How much money do I need to invest in SCHD?▾
You can invest in SCHD with as little as $1 through brokers that offer fractional shares (like Fidelity, Schwab, or Robinhood). There is no minimum investment required beyond the share price itself, which changes daily. Dollar cost averaging — investing a fixed amount regularly — is a popular strategy.
Does SCHD pay dividends?▾
Yes, SCHD pays dividends with a current yield of approximately 3.40%. Dividends are typically paid quarterly and can be reinvested automatically through most brokers.
What are the top holdings in SCHD?▾
The top holdings in SCHD include AbbVie Inc. (4.30%), Coca-Cola Co. (4.20%), Cisco Systems Inc. (4.10%), and more. The fund holds 103 total positions, providing broad diversification across many companies.
What sectors does SCHD invest in?▾
SCHD's largest sector allocations are Financials (18.80%), Health Care (15.50%), Consumer Staples (14.00%). This sector distribution shows a focus on financials stocks.
How much do SCHD's fees cost over time?▾
With an expense ratio of 0.06%, a $10,000 investment in SCHD would lose approximately $515 to fees over 20 years (assuming 8% annual returns). This is a reasonable fee level.