SCHD vs XLU
SCHD vs XLU
Schwab US Dividend Equity ETF vs State Street Utilities 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 | XLU | Winner |
|---|---|---|---|
| Expense Ratio | 0.06% | 0.08% | |
| AUM | $103.7B | $23.5B | |
| Dividend Yield | 3.31% | 2.64% | |
| Holdings | 104 | 34 | |
| YTD Return | +24.26% | +2.35% | |
| 1Y Return | +31.38% | +3.59% | |
| 3Y Return (annualized) | +15.08% | +14.10% | |
| 5Y Return (annualized) | +9.72% | +8.51% | |
| Volatility (annualized) | 13.6% | 15.1% | |
| Max Drawdown | -33.4% | -55.7% | |
| Fund Family | Charles Schwab Asset Management | SPDR State Street Global Advisors | |
| Category | Equity | Equity | |
| Inception | Oct 20, 2011 | Dec 16, 1998 |
SCHD vs XLU Performance
Schwab US Dividend Equity ETF (SCHD) is a ETF from Charles Schwab Asset Management and State Street Utilities Select Sector SPDR ETF (XLU) is a ETF from SPDR State Street Global Advisors. Over the past year SCHD returned +31.38% while XLU returned +3.59%. Year to date, SCHD is up 24.26% versus a gain of 2.35% for XLU.
Over three years, SCHD compounded at +15.08% per year against +14.10% for XLU; over five years the annualized figures are +9.72% and +8.51% respectively. Across the full 15-year window we track, SCHD has the edge at +11.39% annualized vs +4.59%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
XLU has been the more volatile fund, with annualized monthly volatility of 15.1% 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 -33.4% for SCHD and -55.7% for XLU. 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 0.49. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
SCHD charges 0.06% per year while XLU 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 XLU.
Holdings Overlap
SCHD and XLU share 0 holdings out of 132 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 XLU?
SCHD has an expense ratio of 0.06% while XLU 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 XLU?
Over the past year SCHD returned +31.38% vs +3.59% for XLU, so SCHD leads on 1-year performance. Over the longest common window we track (15 years), SCHD annualized +11.39% vs +4.59% for XLU. Past performance does not guarantee future results.
Which is riskier, SCHD or XLU?
XLU has been the more volatile fund at 15.1% annualized versus 13.6% for SCHD. Worst drawdown: SCHD -33.4% vs XLU -55.7%.
Should I hold both SCHD and XLU?
SCHD and XLU have a monthly-return correlation of 0.49, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between SCHD and XLU?
SCHD and XLU share 0 common holdings with a 0.0% weight overlap. Combined, they hold 132 unique securities.
Which pays a higher dividend, SCHD or XLU?
SCHD yields 3.31% while XLU yields 2.64%, so SCHD currently pays the higher dividend yield.
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