SCHD ETF

In this video, I will talk about the Schwab U.S. Dividend Equity ETF (SCHD 0.66%) and whether this could be a great pick for dividend investors in 2025. Watch the short video to learn more, consider subscribing, and click the special offer link below.

With shares of the popular dividend exchange-traded fund (ETF) Schwab US Dividend Equity ETF (SCHD 0.66%), investors are wondering whether it is time to dump the ETF or double up. In today's video, I will explain the pros and cons of the ETF and look at analyst expectations for the top 10 holdings, which include the likes of Pfizer (PFE -0.07%), Coca-Cola (KO -0.15%), and AbbVie (ABBV 0.99%).

The concept of market relativity is more alive than ever in today's economy, as gone are the days of individualistic price action in different asset classes and even stocks. With the advances in data delivery and technology, traders across the financial sector have found ways to connect the dots in pretty much all markets, and that is the one thing that these big hedge funds and investment bank traders get right.

Virtually every investor wants to build wealth, but there are countless roads to this destination. When discussing potential millionaire-making investments, it often boils down to how likely they are to get you where you want to go and how long it will take.

ETFs are a great way to build a solid foundation for any portfolio. Whether you are a growth investor or dividend investor, you want to have a solid base, and ETFs help with that.

Dividend stocks have gotten clobbered recently. The main catalyst is the Federal Reserve's recent decision to slow the pace of future interest rate increases.

Recent price corrections have pushed SCHD's yield to very attractive levels. But the attractiveness is dampened by a few other factors. SCHD's dividend growth has slowed, with the latest payout showing only a 6.9% annual growth rate, a far cry from previous double-digit rates.

SCHD's yield has become attractive relative to solid high yield picks. Current yield of 3.6% with ~11% income growth is a powerful mix. In this article, I share 3 key reasons how income-oriented investors could benefit from going long SCHD.

SCHD has a significant underweight in technology and overexposure to banks. A dovish rate outlook is beneficial for long-duration tech growth stocks, but is a headwind for banks due to higher deposit costs weighing down on NIMs. Industry commentary suggests the tech spending is expected to rebound in 2025. Due to omission of this exposure, SCHD is vulnerable to lag the S&P500.