SCHH vs. RWR: Which U.S. REIT ETF Reigns Supreme?

Schwab U.S. REIT ETF (NYSEMKT:SCHH) stands out for its lower cost and larger asset base, while the State Street SPDR Dow Jones REIT ETF (NYSEMKT:RWR) delivers a higher yield and has outperformed slightly over the past five years.

Both SCHH and RWR are designed to provide investors with exposure to U.S. real estate investment trusts (REITs), but they employ different approaches in terms of cost, performance, and fund size. This comparison highlights where each ETF may appeal, especially for those weighing total returns, risk, and income focus in U.S. REITs.

Snapshot (cost & size)

Beta measures price volatility relative to the S&P 500; beta is calculated from five-year weekly returns. The one-year return represents total return over the trailing 12 months.

SCHH is notably more affordable in fees, charging just 0.07% versus RWR's 0.25%, which could appeal to cost-conscious investors. RWR, on the other hand, offers a higher dividend yield of 3.87% compared to SCHH's 3.03%, potentially attracting those who prioritize income.

Performance & risk comparison

What's inside

RWR focuses exclusively on U.S. real estate, holding 102 REITs as of late 2025. Its largest positions are Prologis Inc. (NYSE:PLD), Welltower Inc. (NYSE:WELL), and Simon Property Group Inc. (NYSE:SPG), with the top two accounting for nearly 20% of the portfolio. The fund has been around for 25 years, offering a long track record for those seeking established options.

In contrast, SCHH also invests in U.S. real estate but holds 123 REITs, spreading its assets a bit more widely. Its top three holdings -- Welltower, Prologis, and Equinix -- match RWR, but with slightly different weightings. SCHH is substantially larger in assets under management, which may matter for those concerned about fund scale or trading volume.

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What this means for investors

With a focus on U.S. REITs, RWR and SCHH have similar portfolios, with eight of their top ten holdings being the same. Despite having this in common, RWR has slightly outperformed it in terms of total returns since 2011, delivering a compound annual growth rate of 7% compared to SCHH's 6.3%. RWR has also delivered higher total returns over the last year, three years, five years, and ten years, suggesting it may be the better operator, despite its higher expense ratios.

While RWR's expense ratio is over three times higher than SCHH's, its 0.25% mark isn't outrageous. Furthermore, this higher fee is offset by the fact that RWR provides a substantial 3.87% dividend yield, which is significantly higher than SCHH's yield of 3.03%. Best yet for investors, State Street SPDR's RWR delivers this outperformance and higher dividend yield with a similar beta and smaller five-year drawdown, showing that it may be less volatile than its REIT peer.

Ultimately, these two REIT ETFs are very similar. However, I would lean toward picking RWR for my portfolio, even with its higher expense ratio. Its track record of outperformance, a near 4% dividend yield, and reasonable relative volatility make it the clear winner in my eyes. That said, Schwab's SCHH has an asset base that is five times larger, holds a lower P/E ratio of 29 (versus RWR's 32), and has a much lower expense ratio -- so it may be a better fit for investors seeking those attributes.

Glossary

ETF: Exchange-traded fund that holds a basket of assets and trades like a stock.
REIT: Real estate investment trust, a company owning or financing income-producing real estate.
Expense ratio: Annual fund operating costs expressed as a percentage of the fund's average assets.
Dividend yield: Annual dividends per share divided by the current share price, shown as a percentage.
Total return: Investment performance including price changes plus all dividends and distributions, assuming reinvestment.
Max drawdown: Largest peak-to-trough decline in an investment's value over a specific period.
Beta: Measure of an investment's volatility compared with a benchmark, often the S&P 500 index.
AUM: Assets under management; total market value of all assets held by a fund.
Yield: Income from an investment, such as dividends, expressed as a percentage of its price.
Portfolio weighting: Percentage of a fund's total assets invested in a particular holding.
Track record: Historical performance and behavior of an investment over time.
Trading volume: Number of shares or units of a security traded during a given period.

Josh Kohn-Lindquist has positions in Prologis. The Motley Fool has positions in and recommends Prologis and Simon Property Group. The Motley Fool has a disclosure policy.