Data indicate it is worthwhile for investors to not only ask their brokers if they can reinvest ETF dividends, but to commit to doing so.
Over the past three years, the WisdomTree Equity Income Fund (NYSEArca: DHS) gained almost 42% in price appreciation, but with reinvested dividends, the number jumps to 60%. Over the past two years, the Schwab US Dividend Equity ETF (NYSEArca: SCHD) is up 46.4% including reinvested dividends, nearly 800 basis points better than its price returns alone. [ETF Spotlight: Schwab Dividend ETF]
Schwab US Dividend Equity ETF
ETF Trends editorial team contributed to this post. Tom Lydon’s clients own shares of DVY and SCHD.