SCHD has been a key part of my long term dividend portfolio for a long time. In may groups I am in there is always a discussion about what is the best Stock/EFT to invest in long term.
Of course, your goal is important. Are you looking for Income right now, dividend growth or overall investment growth over a period of time.
I won’t say I have compared SCHD to every EFT or stock but I have compared it to many (and most of the most popular). So far, I have not found anything that consistently beats
SCHD.
Just looking at the basics, right now SCHD is trading at $77.95 with a dividend of 3.29% and a five year dividend growth rate of 13.74%. Current yield and dividend growth rate are really good for a long term investment.
But, how did SCHD really perform over the past 10 years?
Below is a very quick analysis I did of SCHD. I am assuming you put $10,000.00 into SCHD in 2013 and reinvested your dividends each year with no other additions. In order to make my analysis quicker I only used the stock prices at the beginning of the year and assumed you purchased your new shares (through dividend reinvestment) at an average of the price at the beginning of the year and the price at the end of the year. This is not 100% accurate, but much quicker in putting together the analysis. To be fair, I used the same formula to analyze other EFT and stocks so the same formula or method is always used.
| Initial Investment: | $10,000.00 | Avg Yrly Price | |||||||
| Begin | Beg Year | Year End | Dividend | Shares from | Year End | Year End | Yearly | ||
| Year | Value | Stock$ | Shs Owned | Dividend Yield | Income | Reinvestment | Shares | Value | Change |
| 2013 | $10,000.00 | $28.87 | 346.38 | 2.47% | $247.00 | 7.55 | 353.93 | $12,932.70 | 29.33% |
| 2014 | $12,932.70 | $36.54 | 353.93 | 2.63% | $340.13 | 8.90 | 362.83 | $14,487.74 | 12.02% |
| 2015 | $14,487.74 | $39.93 | 362.83 | 2.97% | $430.29 | 11.03 | 373.86 | $14,229.22 | -1.78% |
| 2016 | $14,229.22 | $38.06 | 373.86 | 2.89% | $411.22 | 10.05 | 383.91 | $16,815.25 | 18.17% |
| 2017 | $16,815.25 | $43.80 | 383.91 | 2.63% | $442.24 | 9.29 | 393.20 | $20,194.99 | 20.10% |
| 2018 | $20,194.99 | $51.36 | 393.20 | 3.06% | $617.97 | 12.65 | 405.85 | $18,807.31 | -6.87% |
| 2019 | $18,807.31 | $46.34 | 405.85 | 2.98% | $560.46 | 10.72 | 416.58 | $24,240.69 | 28.89% |
| 2020 | $24,240.69 | $58.19 | 416.58 | 3.16% | $766.01 | 12.50 | 429.08 | $27,628.22 | 13.97% |
| 2021 | $27,628.22 | $64.39 | 429.08 | 2.78% | $768.06 | 10.57 | 439.65 | $35,567.61 | 28.74% |
| 2022 | $35,567.61 | $80.90 | 439.65 | 3.39% | $1,205.74 | 15.39 | 455.04 | $34,505.33 | -2.99% |
| 2023 | $34,505.33 | $75.83 | 455.04 | ||||||
|
10 Investment Year Change
|
245.05% | ||||||||
|
10 Price Change
|
162.66% | ||||||||
|
10 Year Dividend Change
|
37% | ||||||||
|
10 Dividend Income Change
|
388.15% |
The important thing to look at are the 10 year summary at the end.
Your overall investment is up 245.05% after 10 years. Your dividend income is up 388.15% after 10 years.
I am sure there is some dividend stock out there that beat this return but I doubt it was as relatively safe as SCHD. I still haven’t found an ETF that beat this return over the past 10 years. VOO is the closed I found so far with a 215.90% investment return over the past 10 years. But it’s dividend income is not where close to what SCHD provided.
What else should you always consider? You need to know what the largest holdings of an EFT is.
I always take a look at what an ETF invests in before I decide to invest or add to an existing investment.
SCHD’s current top 10 holdings are:
VZ – Verizon
AVGO – Broadcom
MRK – Merck
PFE – Pfizer
HD – Home Depot
LMT – Lockheed Martin
KO – Coca-Cola
CSCO – Cisco
PEP – Pepsi
TXN – Texas Instruments
Do you believe these stocks are good investment over the long term?