Schwab U.S. Dividend Equity: A Dividend Yield Leader Amid Market Turbulence

Schwab U.S. Dividend Equity (SCHD) has faced difficulties in recent times, despite a trailing twelve-month dividend yield of 3.8%. The ETF has struggled to regain favor due to a tough market environment, particularly against the advance of tech stocks. However, investors may consider buying SCHD before an impending market rotation, as it offers a stable investment option with a high dividend yield.

The Schwab U.S. Dividend Equity ETF (SCHD) has encountered significant challenges in recent times, despite its attractive dividend yield. With a trailing twelve-month yield of 3.8%, SCHD has struggled to regain favor amidst a tough market environment, particularly in the face of the rising dominance of tech stocks [2].

The ETF, which aims to track the Dow Jones U.S. Dividend 100 Index, has seen its net assets decline to nearly $70 billion. This is partly due to the market's preference for growth over income, as seen in the rapid rise of tech stocks and the S&P 500's dividend yield of just 1.2% [2].

However, investors may want to consider SCHD before an impending market rotation. The ETF offers a stable investment option with a high dividend yield, making it an attractive choice for income-focused investors. The top five holdings of SCHD—Chevron, ConocoPhillips, Pepsico, Merck, and Amgen—are drawn from sectors known for dividend stocks, such as energy, consumer staples, and healthcare [2].

While SCHD has faced difficulties, it remains a solid pick for those seeking dividend income. Its holdings are composed of classic blue-chip stocks, providing diversification and a steady stream of income. For those looking to invest in dividend stocks, SCHD offers a reliable option, especially in a market environment where stability is valued.

References:
[1] https://finance.yahoo.com/quote/SCHD/performance/
[2] https://finance.yahoo.com/news/2-dividend-stocks-wont-schwab-113000058.html