FAZ vs SCHD
Direxion Daily Financial Bear 3X ETF vs Schwab US Dividend Equity ETF
Quick Verdict
SCHD has a lower expense ratio. SCHD delivered stronger 1-year returns. SCHD offers more diversification with 104 holdings.
Side-by-Side Comparison
| Metric | FAZ | SCHD | Winner |
|---|---|---|---|
| Expense Ratio | 1.03% | 0.06% | |
| AUM | $84M | $108.7B | |
| Dividend Yield | 2.54% | 3.13% | |
| Holdings | 8 | 104 | |
| YTD Return | -17.66% | +26.54% | |
| 1Y Return | -25.22% | +30.90% | |
| 3Y Return (annualized) | -42.59% | +16.29% | |
| 5Y Return (annualized) | -31.02% | +9.65% | |
| Volatility (annualized) | 53.4% | 13.6% | |
| Max Drawdown | -100.0% | -33.4% | |
| Fund Family | Direxion Shares ETF Trust | Charles Schwab Asset Management | |
| Category | Alternative | Equity | |
| Inception | Nov 6, 2008 | Oct 20, 2011 |
FAZ vs SCHD Performance
Direxion Daily Financial Bear 3X ETF (FAZ) is a ETF from Direxion Shares ETF Trust and Schwab US Dividend Equity ETF (SCHD) is a ETF from Charles Schwab Asset Management. Over the past year FAZ returned -25.22% while SCHD returned +30.90%. Year to date, FAZ is down 17.66% versus a gain of 26.54% for SCHD.
Over three years, FAZ compounded at -42.59% per year against +16.29% for SCHD; over five years the annualized figures are -31.02% and +9.65% respectively. Across the full 15-year window we track, SCHD has the edge at +11.51% annualized vs -52.85%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
FAZ has been the more volatile fund, with annualized monthly volatility of 53.4% compared with 13.6% for SCHD. Lower volatility generally means a smoother ride, though it often comes with lower long-run returns.
The deepest peak-to-trough decline in our data was -100.0% for FAZ and -33.4% for SCHD. Drawdown depth is worth weighing if you expect to sell during market stress rather than ride it out.
The two funds' monthly returns correlate at -0.78. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
FAZ charges 1.03% per year while SCHD charges 0.06%. On a $10,000 position that is $103 vs $6 annually, a gap of $97 per year that compounds over a long holding period. On income, FAZ currently yields 2.54% against 3.13% for SCHD.
Holdings Overlap
FAZ and SCHD share 0 holdings out of 103 unique holdings combined, representing a 0.0% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, FAZ or SCHD?
FAZ has an expense ratio of 1.03% while SCHD charges 0.06%. SCHD is the cheaper option. On a $10,000 investment, that is $97 per year of difference.
Which performed better, FAZ or SCHD?
Over the past year FAZ returned -25.22% vs +30.90% for SCHD, so SCHD leads on 1-year performance. Over the longest common window we track (15 years), FAZ annualized -52.85% vs +11.51% for SCHD. Past performance does not guarantee future results.
Which is riskier, FAZ or SCHD?
FAZ has been the more volatile fund at 53.4% annualized versus 13.6% for SCHD. Worst drawdown: FAZ -100.0% vs SCHD -33.4%.
Should I hold both FAZ and SCHD?
FAZ and SCHD have a monthly-return correlation of -0.78, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between FAZ and SCHD?
FAZ and SCHD share 0 common holdings with a 0.0% weight overlap. Combined, they hold 103 unique securities.
Which pays a higher dividend, FAZ or SCHD?
FAZ yields 2.54% while SCHD yields 3.13%, so SCHD currently pays the higher dividend yield.
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