SCHD’s underlying index screens for companies with average daily dollar volume of at least $2 million, which further enhances liquidity while keeping spreads tight. Each of the ETF’s top-10 holdings, a group that combines for 44.7% of the ETF’s weight, are members of the Dow Jones Industrial Average. [Behind the Rise of the Schwab Dividend ETF]
In terms of dependable dividend growth, SCHD has that as well. Microsoft (NasdaqGS: MSFT), the ETF’s largest holding at a weight of 4.9%, has raised its payout by 21.7% and 15%, respectively, over the past two years. P&G, Johnson & Johnson (NYSE: JNJ) and Coca-Cola, each a top-10 holding in SCHD, have three of the longest dividend increase streaks among U.S. stocks.
SCHD has a distribution yield of 2.65% and can be traded commission-free by Schwab clients.
Schwab US Dividend Equity ETF
ETF Trends editorial team contributed to this post. Tom Lydon’s clients own shares of MOAT, P&G and SCHD.