SCHD vs TAXF
Schwab US Dividend Equity ETF vs American Century Diversified Municipal Bond ETF
Quick Verdict
SCHD has a lower expense ratio. SCHD delivered stronger 1-year returns. TAXF offers more diversification with 491 holdings.
Side-by-Side Comparison
| Metric | SCHD | TAXF | Winner |
|---|---|---|---|
| Expense Ratio | 0.06% | 0.27% | |
| AUM | $103.7B | $684M | |
| Dividend Yield | 3.31% | 3.75% | |
| Holdings | 104 | 713 | |
| YTD Return | +25.62% | +1.02% | |
| 1Y Return | +32.62% | +6.00% | |
| 3Y Return (annualized) | +15.58% | +3.70% | |
| 5Y Return (annualized) | +9.63% | +0.76% | |
| Volatility (annualized) | 13.6% | 6.0% | |
| Max Drawdown | -33.4% | -13.9% | |
| Fund Family | Charles Schwab Asset Management | American Century Investments | |
| Category | Equity | Tax Preferred | |
| Inception | Oct 20, 2011 | Sep 10, 2018 |
SCHD vs TAXF Performance
Schwab US Dividend Equity ETF (SCHD) is a ETF from Charles Schwab Asset Management and American Century Diversified Municipal Bond ETF (TAXF) is a ETF from American Century Investments. Over the past year SCHD returned +32.62% while TAXF returned +6.00%. Year to date, SCHD is up 25.62% versus a gain of 1.02% for TAXF.
Over three years, SCHD compounded at +15.58% per year against +3.70% for TAXF; over five years the annualized figures are +9.63% and +0.76% respectively. Across the full 8-year window we track, SCHD has the edge at +11.47% annualized vs +1.94%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
SCHD has been the more volatile fund, with annualized monthly volatility of 13.6% compared with 6.0% for TAXF. 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 -33.4% for SCHD and -13.9% for TAXF. 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 0.39. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
SCHD charges 0.06% per year while TAXF charges 0.27%. On a $10,000 position that is $6 vs $27 annually, a gap of $21 per year that compounds over a long holding period. On income, SCHD currently yields 3.31% against 3.75% for TAXF.
Holdings Overlap
SCHD and TAXF share 0 holdings out of 591 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, SCHD or TAXF?
SCHD has an expense ratio of 0.06% while TAXF charges 0.27%. SCHD is the cheaper option. On a $10,000 investment, that is $21 per year of difference.
Which performed better, SCHD or TAXF?
Over the past year SCHD returned +32.62% vs +6.00% for TAXF, so SCHD leads on 1-year performance. Over the longest common window we track (8 years), SCHD annualized +11.47% vs +1.94% for TAXF. Past performance does not guarantee future results.
Which is riskier, SCHD or TAXF?
SCHD has been the more volatile fund at 13.6% annualized versus 6.0% for TAXF. Worst drawdown: SCHD -33.4% vs TAXF -13.9%.
Should I hold both SCHD and TAXF?
SCHD and TAXF have a monthly-return correlation of 0.39, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between SCHD and TAXF?
SCHD and TAXF share 0 common holdings with a 0.0% weight overlap. Combined, they hold 591 unique securities.
Which pays a higher dividend, SCHD or TAXF?
SCHD yields 3.31% while TAXF yields 3.75%, so TAXF currently pays the higher dividend yield.
Popular ETF Comparisons
Get Full ETF Analytics
Access complete holdings data, overlap analysis, screener tools, and more with FundXLS.