IWM vs SCHD
iShares Russell 2000 ETF vs Schwab US Dividend Equity ETF
Quick Verdict
SCHD has a lower expense ratio. IWM delivered stronger 1-year returns. IWM offers more diversification with 1,996 holdings.
Side-by-Side Comparison
| Metric | IWM | SCHD | Winner |
|---|---|---|---|
| Expense Ratio | 0.19% | 0.06% | |
| AUM | $79.5B | $103.7B | |
| Dividend Yield | 0.88% | 3.31% | |
| Holdings | 1,996 | 104 | |
| YTD Return | +22.50% | +26.21% | |
| 1Y Return | +32.62% | +29.99% | |
| 3Y Return (annualized) | +18.16% | +15.73% | |
| 5Y Return (annualized) | +7.87% | +9.67% | |
| Volatility (annualized) | 20.0% | 13.6% | |
| Max Drawdown | -59.9% | -33.4% | |
| Fund Family | iShares by BlackRock (US) | Charles Schwab Asset Management | |
| Category | Equity | Equity | |
| Inception | May 22, 2000 | Oct 20, 2011 |
IWM vs SCHD Performance
iShares Russell 2000 ETF (IWM) is a ETF from iShares by BlackRock (US) and Schwab US Dividend Equity ETF (SCHD) is a ETF from Charles Schwab Asset Management. Over the past year IWM returned +32.62% while SCHD returned +29.99%. Year to date, IWM is up 22.50% versus a gain of 26.21% for SCHD.
Over three years, IWM compounded at +18.16% per year against +15.73% for SCHD; over five years the annualized figures are +7.87% and +9.67% respectively. Across the full 15-year window we track, SCHD has the edge at +11.50% annualized vs +7.76%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
IWM has been the more volatile fund, with annualized monthly volatility of 20.0% 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 -59.9% for IWM 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 usually move together, but the gap leaves some room for diversification.
Fees and Cost Over Time
IWM charges 0.19% per year while SCHD charges 0.06%. On a $10,000 position that is $19 vs $6 annually, a gap of $13 per year that compounds over a long holding period. On income, IWM currently yields 0.88% against 3.31% for SCHD.
Holdings Overlap
IWM and SCHD share 27 holdings out of 1667 unique holdings combined, representing a 1.3% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, IWM or SCHD?
IWM has an expense ratio of 0.19% while SCHD charges 0.06%. SCHD is the cheaper option. On a $10,000 investment, that is $13 per year of difference.
Which performed better, IWM or SCHD?
Over the past year IWM returned +32.62% vs +29.99% for SCHD, so IWM leads on 1-year performance. Over the longest common window we track (15 years), IWM annualized +7.76% vs +11.50% for SCHD. Past performance does not guarantee future results.
Which is riskier, IWM or SCHD?
IWM has been the more volatile fund at 20.0% annualized versus 13.6% for SCHD. Worst drawdown: IWM -59.9% vs SCHD -33.4%.
Should I hold both IWM and SCHD?
IWM 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 IWM and SCHD?
IWM and SCHD share 27 common holdings with a 1.3% weight overlap. Combined, they hold 1667 unique securities.
Which pays a higher dividend, IWM or SCHD?
IWM yields 0.88% while SCHD yields 3.31%, so SCHD currently pays the higher dividend yield.
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