For investors seeking a balanced blend of income and capital appreciation, the Schwab U.S. Dividend Equity ETF (SCHD) continues to be a standout option. In Q1 2025, SCHD reaffirmed its place as a core holding for income-focused portfolios .
The Schwab U.S. Dividend Equity ETF (SCHD) tracks a dividend-weighted index of 100 high-yielding U.S. companies with a solid track record of consistent dividend payouts and quality fundamentals. It focuses on companies that have:
At least 10 years of consistent dividend payments
Strong return on equity (ROE)
Stable earnings growth
Financial health and liquidity
This makes SCHD a reliable choice for long-term investors looking to generate passive income through quarterly dividends while maintaining exposure to blue-chip U.S. equities.
Q1 Return: +8.2%
Top Holdings: PepsiCo, Texas Instruments, Verizon
Yield Focus: Targets companies with a track record of 10+ years of dividend payouts
In the first quarter of 2025, SCHD delivered a total return of approximately 8.2%, reinforcing its reputation as a stable performer even during volatile macroeconomic conditions. While growth-oriented stocks in tech and AI sectors led the headlines, SCHD quietly outpaced broader value indices — thanks to its focus on high-quality, dividend-paying U.S. companies.
Key Performance Drivers:
Strength in Defensive Sectors: SCHD’s exposure to sectors like consumer staples, healthcare, and industrials provided cushion during inflationary pressures and interest rate uncertainty. Companies like PepsiCo, Coca-Cola, and Pfizer remained resilient and continued to grow earnings.
Dividend Consistency: The fund maintained a dividend yield of around 3.6%, making it highly attractive to income-seeking investors amidst uneven interest rate signals from the Fed.
Value Over Hype: As many investors rotated out of speculative growth names into solid, cash-flow rich businesses, SCHD benefited from renewed interest in dividend equity strategies.
Comparative Outlook:
SCHD outperformed the Dow Jones U.S. Dividend 100 Index, its benchmark, and remained competitive against high-profile ETFs in the same category like Vanguard Dividend Appreciation ETF (VIG) and iShares Select Dividend ETF (DVY).
It also proved to be less volatile than the S&P 500 during sector swings, reinforcing its role as a portfolio stabilizer.
This performance makes SCHD especially relevant for East African investors looking for consistent U.S. dollar returns, passive income, and long-term capital protection through the GoldKach Prime Growth Fund.
Disclaimer: This content does not constitute investment advice. Always consult with a licensed financial advisor before making investment decisions.