If You Buy the Schwab U.S. Dividend Equity ETF, You Might Want to Add This Dividend ETF Too

The Schwab U.S. Dividend Equity ETF (NYSEMKT: SCHD) is offering an attractive dividend yield today of around 4% or so. It is also very well-designed, mixing income, company quality, and growth into one exchange-traded fund (ETF) option. But it misses out on some key dividend-focused sectors, which is why you might want to add this one simple dividend ETF to your portfolio if you own the Schwab U.S. Dividend Equity ETF.Getting right into the meat of it, the Schwab U.S. Dividend Equity ETF only looks at companies that have increased their dividends for at least a decade. It then eliminates real estate investment trusts (REITs) from the list. For all the stocks that remain, it creates a composite score looking at cash flow to total debt, return on equity, dividend yield, and a company's five-year dividend growth rate.Image source: Getty Images.Continue reading

May 26, 2025 - 09:33

If You Buy the Schwab U.S. Dividend Equity ETF, You Might Want to Add This Dividend ETF Too

The Schwab U.S. Dividend Equity ETF (NYSEMKT: SCHD) is offering an attractive dividend yield today of around 4% or so. It is also very well-designed, mixing income, company quality, and growth into one exchange-traded fund (ETF) option. But it misses out on some key dividend-focused sectors, which is why you might want to add this one simple dividend ETF to your portfolio if you own the Schwab U.S. Dividend Equity ETF.

Getting right into the meat of it, the Schwab U.S. Dividend Equity ETF only looks at companies that have increased their dividends for at least a decade. It then eliminates real estate investment trusts (REITs) from the list. For all the stocks that remain, it creates a composite score looking at cash flow to total debt, return on equity, dividend yield, and a company's five-year dividend growth rate.

Image source: Getty Images.