SCHD vs XSW
Schwab US Dividend Equity ETF vs State Street SPDR S&P Software & Services ETF
Quick Verdict
SCHD has a lower expense ratio. SCHD delivered stronger 1-year returns. XSW offers more diversification with 134 holdings.
Side-by-Side Comparison
| Metric | SCHD | XSW | Winner |
|---|---|---|---|
| Expense Ratio | 0.06% | 0.35% | |
| AUM | $108.7B | $516M | |
| Dividend Yield | 3.13% | 0.00% | |
| Holdings | 104 | 134 | |
| YTD Return | +28.63% | +8.93% | |
| 1Y Return | +32.53% | +9.46% | |
| 3Y Return (annualized) | +16.97% | +16.00% | |
| 5Y Return (annualized) | +10.47% | +3.72% | |
| Volatility (annualized) | 13.7% | 20.8% | |
| Max Drawdown | -33.4% | -45.4% | |
| Fund Family | Charles Schwab Asset Management | State Street Investment Management | |
| Category | Equity | Equity | |
| Inception | Oct 20, 2011 | Sep 28, 2011 |
SCHD vs XSW Performance
Schwab US Dividend Equity ETF (SCHD) is a ETF from Charles Schwab Asset Management and State Street SPDR S&P Software & Services ETF (XSW) is a ETF from State Street Investment Management. Over the past year SCHD returned +32.53% while XSW returned +9.46%. Year to date, SCHD is up 28.63% versus a gain of 8.93% for XSW.
Over three years, SCHD compounded at +16.97% per year against +16.00% for XSW; over five years the annualized figures are +10.47% and +3.72% respectively. Across the full 15-year window we track, XSW has the edge at +15.79% annualized vs +11.63%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
XSW has been the more volatile fund, with annualized monthly volatility of 20.8% compared with 13.7% 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 -45.4% for XSW. 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 0.58. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
SCHD charges 0.06% per year while XSW charges 0.35%. On a $10,000 position that is $6 vs $35 annually, a gap of $29 per year that compounds over a long holding period. On income, SCHD currently yields 3.13% against 0.00% for XSW.
Holdings Overlap
SCHD and XSW share 0 holdings out of 232 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 XSW?
SCHD has an expense ratio of 0.06% while XSW charges 0.35%. SCHD is the cheaper option. On a $10,000 investment, that is $29 per year of difference.
Which performed better, SCHD or XSW?
Over the past year SCHD returned +32.53% vs +9.46% for XSW, so SCHD leads on 1-year performance. Over the longest common window we track (15 years), SCHD annualized +11.63% vs +15.79% for XSW. Past performance does not guarantee future results.
Which is riskier, SCHD or XSW?
XSW has been the more volatile fund at 20.8% annualized versus 13.7% for SCHD. Worst drawdown: SCHD -33.4% vs XSW -45.4%.
Should I hold both SCHD and XSW?
SCHD and XSW have a monthly-return correlation of 0.58, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between SCHD and XSW?
SCHD and XSW share 0 common holdings with a 0.0% weight overlap. Combined, they hold 232 unique securities.
Which pays a higher dividend, SCHD or XSW?
SCHD yields 3.13% while XSW yields 0.00%, so SCHD currently pays the higher dividend yield.
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