Dividend Stability or Growth Exposure? SCHD and FDVV
Key Points
FDVV carries a higher expense ratio but has delivered stronger 1-year and 5-year total returns than SCHD
SCHD offers a higher dividend yield at 3.4% and more defensive sector exposure, with Consumer Defensive at 19%
FDVV tilts toward technology and financials while SCHD leans into energy and consumer defensive stocks
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Schwab U.S. Dividend Equity ETF (NYSEMKT:SCHD) and FIDELITY HIGH DIVIDEND ETF (NYSEMKT:FDVV) differ on cost, recent performance, yield, and sector tilts, with FDVV showing higher recent returns but SCHD maintaining a higher yield.
Both funds target U.S. stocks with an income focus, but approach their mandates differently. This comparison looks at how SCHD and FDVV stack up on cost, returns, risk, and portfolio construction to help investors identify which strategy may appeal based on their priorities.
Snapshot (cost & size)
| Metric | SCHD | FDVV |
|---|---|---|
| Issuer | Schwab | Fidelity |
| Expense ratio | 0.06% | 0.15% |
| 1-yr return (as of 2026-03-11) | 11.8% | 15.7% |
| Dividend yield | 3.3% | 2.9% |
| Beta | 0.65 | 0.88 |
| AUM | $85.9 billion | $8.9 billion |
Beta measures price volatility relative to the S&P 500; beta is calculated from five-year monthly returns. The 1-yr return represents total return over the trailing 12 months.
FDVV charges a higher expense ratio, which could matter for cost-conscious investors, while SCHD is more affordable. SCHD also offers a higher dividend yield, which may appeal to those focused on income.
Performance & risk comparison
| Metric | SCHD | FDVV |
|---|---|---|
| Max drawdown (5 y) | -16.86% | -20.17% |
| Growth of $1,000 over 5 years | $1,282 | $1,603 |
What's inside
FDVV primarily tilts toward technology (25%), financial services (17%), and consumer cyclical stocks (16%), with 119 holdings as of its ninth year. Its top positions are Nvidia Corp (NASDAQ:NVDA), Apple Inc (NASDAQ:AAPL), and Microsoft Corp (NASDAQ:MSFT), giving it a growth-oriented flavor within the dividend space. There are no notable structural or thematic quirks affecting FDVV’s strategy.
By contrast, SCHD has a more defensive posture, emphasizing energy (21%), consumer defensive (19%), and healthcare (16%) stocks. Its top three holdings are Lockheed Martin Corp (NYSE:LMT), Verizon Communications Inc (NYSE:VZ), and Conocophillips (NYSE:COP). This tilt may contribute to SCHD’s lower volatility and higher yield, making it attractive for those seeking stability and income.
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What this means for investors
Dividend investors often focus on yield, but the companies that generate that income are equally important. This distinction is central when comparing the Schwab U.S. Dividend Equity ETF and the Fidelity High Dividend ETF.
SCHD’s index does not simply select companies with attractive yields. It ranks companies by return on equity, cash flow to debt, and dividend history. This approach helps the fund avoid companies with high but less durable dividends. As a result, SCHD often behaves more like a quality equity strategy that pays dividends, rather than a pure yield strategy. FDVV takes a broader approach. Its methodology allows companies with strong earnings growth and moderate dividend yields to qualify, which is why technology companies such as Apple and Microsoft appear in the portfolio. The result is a dividend ETF that can participate more directly in growth-led equity rallies, but whose income stream may be less central to the strategy.
For investors, the real question is how the dividend allocation should behave. SCHD is for those who prioritize dependable income from mature, cash-generating businesses. FDVV suits investors who want dividend income but also want their portfolio tied to growth companies that increasingly shape market returns.
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Eric Trie has positions in Nvidia. The Motley Fool has positions in and recommends Apple, Microsoft, and Nvidia and is short shares of Apple. The Motley Fool recommends ConocoPhillips, Lockheed Martin, and Verizon Communications. The Motley Fool has a disclosure policy.
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