From 24/7 Wall St. · Ryne Mauck · · 50s
Schwab Dividend ETF's Hidden Cost
Schwab's 0.06% fee hides $413,350 in decade-long underperformance on $500k.
In brief
Schwab's 0.06% fee hides $413,350 in decade-long underperformance on $500k. A $500,000 position in SCHD lost $413,350 over ten years versus S&P 500 due to concentrated holdings and lower yields. Originally reported by 24/7 Wall St..
SCHD's fee
SCHD charges 0.06% fee per $10,000 invested.
Decade performance gap
SCHD grew to $1,688,200 on $500,000 over ten years.
S&P 500 comparison
S&P 500 fund grew to $2,101,550 on $500,000 over ten years.
Concentrated holdings
SCHD holds 6.74% Qualcomm and 5.90% Texas Instruments.
Yield decline
SCHD's trailing 12-month distribution dropped to $1.048.
Alternative options
VYM, DGRO, and VIG offer better dividend exposure at similar fees.
Investor choice
SCHD investors must choose between dividend yield and long-term growth.
At a glance
A $500,000 position in SCHD lost $413,350 over ten years versus S&P 500 due to concentrated holdings and lower yields.
