🏦 Schwab U.S. Dividend Equity ETF (SCHD) Semiannual Report 2025

The Schwab U.S. Dividend Equity ETF (SCHD) continues to stand out as a pillar of stability for investors who seek a balance between dividend income and long-term capital appreciation. Based on the Semiannual Shareholder Report for the period September 1, 2024, to February 28, 2025, Schwab Asset Management reaffirms its commitment to quality, efficiency, and disciplined portfolio strategy.

In this comprehensive analysis, we unpack SCHD’s latest data — from returns, sector allocations, and costs to its top holdings and future investment outlook — to help investors understand why this ETF remains a trusted option in 2025.

📊Schwab U.S. Dividend Equity ETF (SCHD) Fund Overview [Key Facts at a Glance]

SCHD’s $70 billion asset base reflects investor confidence in its consistent, dividend-focused performance. The 7% portfolio turnover also underscores its long-term, buy-and-hold approach — keeping costs and tax implications low for shareholders.

💰 Ultra-Low Cost [A Benchmark for Efficiency on Schwab U.S. Dividend Equity ETF (SCHD)]

Schwab is well-known for cost leadership, and SCHD exemplifies this perfectly. During the reporting period, the average cost on a $10,000 investment amounted to just $3, translating to an annualized expense ratio of 0.06%.

That’s cheaper than 94% of U.S. equity ETFs. For investors, every dollar saved in fees compounds over time — giving SCHD a long-term edge in total return performance.

Investor Insight: When searching for best low-cost dividend ETFs in 2025, SCHD consistently ranks at the top.

📈 Schwab U.S. Dividend Equity ETF (SCHD) Performance Review [Returns That Endure]

Let’s compare SCHD’s results to its key benchmarks — the S&P 500® Index and the Dow Jones U.S. Dividend 100™ Index.

Despite modest underperformance versus the S&P 500, SCHD’s 10-year annualized return of 11.3% demonstrates long-term consistency and resilience. Its focus on quality dividend payers ensures steadier returns with less volatility during market corrections.

🧭 Schwab U.S. Dividend Equity ETF (SCHD) Investment Strategy [Quality Over Quantity]

SCHD mirrors the Dow Jones U.S. Dividend 100™ Index, selecting 100 of the highest-dividend-yielding U.S. companies with sustainable earnings and strong fundamentals. Selection is based on:

• 10-year dividend history
• Return on equity (ROE)
• Dividend yield and growth rate
• Financial strength

This methodology helps filter out risky, unsustainable high-yield stocks and prioritizes financially sound corporations.

“SCHD doesn’t chase high yields—it focuses on the most dependable dividend payers,” emphasizes Schwab Asset Management.

🏢 Schwab U.S. Dividend Equity ETF (SCHD) Sector Allocation [Defensive Yet Diversified]

SCHD’s portfolio is balanced between growth and defensive industries, creating a hedge against sector-specific downturns.

The strong presence in financials, health care, and staples provides stability, while exposure to energy and technology offers growth potential. The negligible stake in utilities signals SCHD’s avoidance of slow-growth, rate-sensitive sectors.

💎 Top 10 Holdings of Schwab U.S. Dividend Equity ETF (SCHD) [ Dividend Titans ]

These blue-chip names represent roughly 42% of SCHD’s assets, highlighting a focused yet diversified core. Each company boasts a strong dividend history and solid balance sheet — the cornerstone of SCHD’s dependability.

⚖️ Schwab U.S. Dividend Equity ETF (SCHD) Risk and Stability [Lower Volatility, Higher Confidence]

While growth ETFs dominated 2023–2024, SCHD provided lower volatility and steadier income, thanks to its beta of around 0.9.
That means it moves 10% less than the overall market, cushioning investors during corrections.

• Volatility control: Defensive sectors and dividend reinvestment help smooth returns.
• Income reliability: Quarterly payouts continue even when prices fluctuate.
• Total return consistency: SCHD’s reinvested dividends historically deliver over 11% annualized long-term returns.

💵 Schwab U.S. Dividend Equity ETF (SCHD) Dividends [Compounding the Smart Way]

SCHD distributes dividends quarterly — typically in March, June, September, and December. Its dividend yield hovers between 3.4% – 4.0%, depending on market pricing and interest rates.

Why SCHD dividends matter:

• Regular income stream for retirees and passive-income investors.
• Automatic reinvestment amplifies compounding.
• Dividend growth offsets inflation over time.

🧠 Why Investors Choose SCHD

1. Proven Performance

A 10-year annualized return of 11.3% positions SCHD among the best long-term performers in its category.

2. High-Quality Dividend Payers

Each holding has a decade or more of dividend payments, with robust earnings and strong cash flows.

3. Ultra-Low Fees

With a 0.06% expense ratio, SCHD keeps more of your returns compounding.

4. Tax Efficiency

Low portfolio turnover minimizes taxable capital gains, benefiting taxable brokerage accounts.

5. Recession-Resilient

Exposure to consumer staples and health care offers protection during downturns.

🔍 SCHD vs. Other Dividend ETFs

Among these, SCHD stands out for its balance of yield, growth, and cost control — making it a cornerstone for income-oriented portfolios.

🔮 Market Outlook 2025-2026 for the US stock market

As inflation moderates and interest-rate pressures ease, dividend-focused ETFs are expected to attract new inflows. SCHD’s mix of defensive and growth-oriented stocks positions it well for the coming market cycle.

Potential Catalysts

• Fed rate cuts could boost equity valuations.
• Corporate dividend growth remains strong across financials and staples.
• Investor demand for income continues to rise amid uncertain bond yields.

“SCHD is built for patient investors who value quality, not hype,” note Schwab strategists.

🧩 Final Verdict [Is SCHD Still Worth Buying?]

Yes — and here’s why.

SCHD remains a top-tier ETF for 2025 — blending dependable dividends, reasonable growth, and unmatched cost efficiency. Whether you’re building a retirement income stream or diversifying an existing portfolio, SCHD offers a strong foundation for steady, long-term compounding.

📚 References

• Schwab Asset Management Semiannual Report (Feb 28, 2025)
• Dow Jones U.S. Dividend 100™ Index Data
• S&P 500® Performance Benchmarks
• Morningstar ETF Research (2025 Projections)

Click here to donwload Schwab U.S. Dividend Equity ETF Report (Feb 2025)