SCHD vs XLP
Schwab US Dividend Equity ETF vs State Street Consumer Staples Select Sector SPDR ETF
Quick Verdict
SCHD has a lower expense ratio. SCHD delivered stronger 1-year returns. SCHD offers more diversification with 100 holdings.
Side-by-Side Comparison
| Metric | SCHD | XLP | Winner |
|---|---|---|---|
| Expense Ratio | 0.06% | 0.08% | |
| AUM | $103.7B | $14.5B | |
| Dividend Yield | 3.31% | 2.64% | |
| Holdings | 104 | 39 | |
| YTD Return | +25.33% | +10.72% | |
| 1Y Return | +32.31% | +5.94% | |
| 3Y Return (annualized) | +15.40% | +7.21% | |
| 5Y Return (annualized) | +9.70% | +6.22% | |
| Volatility (annualized) | 13.6% | 12.5% | |
| Max Drawdown | -33.4% | -37.8% | |
| Fund Family | Charles Schwab Asset Management | SPDR State Street Global Advisors | |
| Category | Equity | Equity | |
| Inception | Oct 20, 2011 | Dec 16, 1998 |
SCHD vs XLP Performance
Schwab US Dividend Equity ETF (SCHD) is a ETF from Charles Schwab Asset Management and State Street Consumer Staples Select Sector SPDR ETF (XLP) is a ETF from SPDR State Street Global Advisors. Over the past year SCHD returned +32.31% while XLP returned +5.94%. Year to date, SCHD is up 25.33% versus a gain of 10.72% for XLP.
Over three years, SCHD compounded at +15.40% per year against +7.21% for XLP; over five years the annualized figures are +9.70% and +6.22% respectively. Across the full 15-year window we track, SCHD has the edge at +11.45% annualized vs +4.85%. 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 12.5% for XLP. 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 -37.8% for XLP. 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 0.77. They usually move together, but the gap leaves some room for diversification.
Fees and Cost Over Time
SCHD charges 0.06% per year while XLP charges 0.08%. On a $10,000 position that is $6 vs $8 annually, a gap of $2 per year that compounds over a long holding period. On income, SCHD currently yields 3.31% against 2.64% for XLP.
Holdings Overlap
SCHD and XLP share 9 holdings out of 126 unique holdings combined, representing a 19.9% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, SCHD or XLP?
SCHD has an expense ratio of 0.06% while XLP charges 0.08%. SCHD is the cheaper option. On a $10,000 investment, that is $2 per year of difference.
Which performed better, SCHD or XLP?
Over the past year SCHD returned +32.31% vs +5.94% for XLP, so SCHD leads on 1-year performance. Over the longest common window we track (15 years), SCHD annualized +11.45% vs +4.85% for XLP. Past performance does not guarantee future results.
Which is riskier, SCHD or XLP?
SCHD has been the more volatile fund at 13.6% annualized versus 12.5% for XLP. Worst drawdown: SCHD -33.4% vs XLP -37.8%.
Should I hold both SCHD and XLP?
SCHD and XLP have a monthly-return correlation of 0.77, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between SCHD and XLP?
SCHD and XLP share 9 common holdings with a 19.9% weight overlap. Combined, they hold 126 unique securities.
Which pays a higher dividend, SCHD or XLP?
SCHD yields 3.31% while XLP yields 2.64%, so SCHD currently pays the higher dividend yield.
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