SCHD vs ZROZ
Schwab US Dividend Equity ETF vs PIMCO 25+ Year Zero Coupon US Treasury Index Exchange-Traded Fund
Quick Verdict
SCHD has a lower expense ratio. SCHD delivered stronger 1-year returns. SCHD offers more diversification with 104 holdings.
Side-by-Side Comparison
| Metric | SCHD | ZROZ | Winner |
|---|---|---|---|
| Expense Ratio | 0.06% | 0.15% | |
| AUM | $108.7B | $1.4B | |
| Dividend Yield | 3.13% | 5.52% | |
| Holdings | 104 | 23 | |
| YTD Return | +27.67% | -6.34% | |
| 1Y Return | +31.26% | -5.06% | |
| 3Y Return (annualized) | +16.66% | -4.90% | |
| 5Y Return (annualized) | +10.18% | -14.57% | |
| Volatility (annualized) | 13.6% | 21.7% | |
| Max Drawdown | -33.4% | -63.7% | |
| Fund Family | Charles Schwab Asset Management | PIMCO (US) | |
| Category | Equity | Fixed Income | |
| Inception | Oct 20, 2011 | Oct 30, 2009 |
SCHD vs ZROZ Performance
Schwab US Dividend Equity ETF (SCHD) is a ETF from Charles Schwab Asset Management and PIMCO 25+ Year Zero Coupon US Treasury Index Exchange-Traded Fund (ZROZ) is a ETF from PIMCO (US). Over the past year SCHD returned +31.26% while ZROZ returned -5.06%. Year to date, SCHD is up 27.67% versus a loss of 6.34% for ZROZ.
Over three years, SCHD compounded at +16.66% per year against -4.90% for ZROZ; over five years the annualized figures are +10.18% and -14.57% respectively. Across the full 15-year window we track, SCHD has the edge at +11.57% annualized vs -0.27%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
ZROZ has been the more volatile fund, with annualized monthly volatility of 21.7% 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 -63.7% for ZROZ. 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 0.01. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
SCHD charges 0.06% per year while ZROZ charges 0.15%. On a $10,000 position that is $6 vs $15 annually, a gap of $9 per year that compounds over a long holding period. On income, SCHD currently yields 3.13% against 5.52% for ZROZ.
Holdings Overlap
SCHD and ZROZ share 0 holdings out of 118 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 ZROZ?
SCHD has an expense ratio of 0.06% while ZROZ charges 0.15%. SCHD is the cheaper option. On a $10,000 investment, that is $9 per year of difference.
Which performed better, SCHD or ZROZ?
Over the past year SCHD returned +31.26% vs -5.06% for ZROZ, so SCHD leads on 1-year performance. Over the longest common window we track (15 years), SCHD annualized +11.57% vs -0.27% for ZROZ. Past performance does not guarantee future results.
Which is riskier, SCHD or ZROZ?
ZROZ has been the more volatile fund at 21.7% annualized versus 13.6% for SCHD. Worst drawdown: SCHD -33.4% vs ZROZ -63.7%.
Should I hold both SCHD and ZROZ?
SCHD and ZROZ have a monthly-return correlation of 0.01, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between SCHD and ZROZ?
SCHD and ZROZ share 0 common holdings with a 0.0% weight overlap. Combined, they hold 118 unique securities.
Which pays a higher dividend, SCHD or ZROZ?
SCHD yields 3.13% while ZROZ yields 5.52%, so ZROZ currently pays the higher dividend yield.
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