Is SCHD Really That Great?
At $68 Billion in assets, does SCHD really have the goods?
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So I was kind of curious about SCHD because everyone keeps talking about it.
So since October 21, 2011, SCHD has had $21.09 dividends in total.
An $8.49 starting price.
So with today's price of $27.47, that's a $18.98 capital gain or a... (18.98/8.49 =) 223.55% capital gain.
Divide that by the number of months (158.59) and you get... 1.40% per month. Except... no one realistically bought their shares back in 2011 so that is "pie in the sky" thinking as far as the future goes.
Total dividends for the time period were: $21.09 (source https://www.nasdaq.com/market-activity/etf/schd/dividend-history)
So $21.09 in total dividends divided by $8.49 gives you at total yield of 248.40%... except, you need to divide that by the total number of months, which is again 158.59 or a monthly yield of 1.56% per month. Which again just isn't happening.
Which gives you a grand total (again, if you'd bought your shares way back in October of 2011) an overall return (cap gains + yield) of 2.96% return per month, more or less.
But unfortunately, we don't have a time machine, so the real picture for SCHD is more like this—which is SCHD's performance over the past year (since 1/1/2024).
Where you've got your initial price (1/1/2024), current price (12/29/2024), high, and low prices, and your dividend total.
And following that are the various yields if you'd bought SCHD today (current price), or at the high, low, or way back on Jan 1, 2024 (initial price).
This is way more realistic because it gives you a feel for what's actually happening right now -- or at least in the not-to-far-distant past (the preceding year).
Which means actual yield is somewhere in the range between 0.69% per month, and 0.82% per month, depending on where you bought SCHD.
Total yield since the beginning of the year is in yellow -- 9.59% which is ok.
Add in the cap gains since Jan 1, 2024 (7.47%) and you've got a total of 17.06% for the year or about 1.43% per month. Which is also... ok.
But let's compare that to YMAX (a YieldMax stock) over the same period.
Now YMAX is a highly diversified ETF that holds 28 other YieldMax stocks. See:
So it’s not as good as some of YieldMax’s best stuff, but also not as bad as its worst. To see more check out the current full YieldMax review.
So YieldMax has it's own problems. But when you compare the two, YMAX beats SCHD’s yield by a mile, even though YMAX takes a hit on capital gains.
YMAX also just started this year (1/19/2024) so has a slightly shorter performance history (11.33 months).
So same deal as the table above: initial (1/19/2024) price, current price (12/29/2024) and the high and low.
Then the number of months, followed by yields depending where you bought it.
Total yield over the time period (yellow) and average yield per month (blue).
So YMAX's yield averages between 3.01%/month and 3.89%/month.
But the overall picture is actually in the final line of both tables -- the overall Gain/Loss per which includes BOTH yield + capital gain.
Which means that SCHD stores value mostly in the capital gains (17.06%), and YMAX in the distributions (37.23%).
Which brings us back around to the perpetual question of the tradeoff between high yields and stock price.
I think the answer is that basically there is no "free" money anywhere. The money has to come from somewhere, so you really do end up kind of picking one or the other.
YMAX is slightly better here, but I think with all of this stuff, you have to look at cap gains AND yields together in order to figure out what's actually going on.
That's what we do here at Dividend Farmer pretty much exclusively — hope you will join us.
Data-driven answers. No BS.
