SCHD
Schwab U.S. Dividend Equity ETF
SCHD tracks the Dow Jones U.S. Dividend 100 Index, focusing on high dividend yield with rigorous quality screens. Requires 10+ years of dividend payments and screens for financial health metrics. 100% US exposure.
VXUS
Vanguard Total International Stock ETF
VXUS tracks the FTSE Global All Cap ex US Index, providing broad exposure to developed and emerging markets outside the United States. Includes large, mid, and small-cap stocks across 47 countries.
Key Metrics Comparison
| Metric | SCHD | VXUS | Winner |
|---|---|---|---|
| Dividend Yield | 3.27% | 3.02% | SCHD (+0.44%) |
| Expense Ratio | 0.06% | 0.08% | SCHD (-0.02%) |
| 5-Year Annual Return | 11.2% | 4.8% | SCHD (+6.4%) |
| Number of Holdings | 104 | 7,959 | VXUS |
| Assets Under Management | $95.2B | $69.5B | VXUS |
| P/E Ratio | 15.2 | 12.8 | VXUS |
| Geographic Exposure | 100% US | 100% Ex-US | Complementary |
| Volatility (5-Year) | 15.2% | 16.5% | SCHD |
Performance Comparison
SCHD Performance
Strong total returns with higher income from US quality dividend stocks. Has outperformed international markets significantly over the past decade.
VXUS Performance
Lower returns but provides crucial international diversification. Higher yield than most international funds, but significant currency and geopolitical risks.
Strategy Analysis
SCHD Approach
US-focused quality dividend growth investing:
- 100% US large-cap companies
- Minimum 10 years of dividend payments
- Dividend yield > 2.5% requirement
- Cash flow to total debt > 50%
- Return on equity > 15%
- Focus on financial health and stability
- Value-oriented, defensive sectors
- Concentrated in 104 quality companies
VXUS Approach
Complete international stock market indexing:
- 100% ex-US companies (47 countries)
- 7,959+ holdings across all market caps
- Developed and emerging markets
- Market-cap weighted (developed dominant)
- Ultra-low-cost passive strategy
- Complete non-US market representation
- Currency diversification benefits
- Geographic diversification in one ETF
Geographic Concentration vs Global Diversification
SCHD offers US quality concentration (104 holdings, quality screens, 3.27% yield) with value tilt, while VXUS provides complete international diversification (7,959 holdings, 47 countries, 3.02% yield). This represents the choice between focused US quality and maximum geographic diversification.
SCHD US Concentration Advantages
Quality screens: Financial health filters
Higher income: 3.27% yield vs 3.02%
Better returns: 11.2% vs 4.8% (5-year)
Lower cost: 0.06% vs 0.08% expense ratio
VXUS Global Diversification Advantages
Geographic diversification: 47 countries
Emerging market exposure: 25% allocation
Currency diversification: Hedge against USD
Valuation discount: P/E 12.8 vs 15.2
Geographic & Regional Exposure
VXUS Regional Distribution (SCHD is 100% US)
VXUS provides exposure to developed markets (Europe, Japan, Canada, Australia) and emerging markets (China, India, Brazil, Taiwan, South Korea).
Europe
Pacific Developed
Emerging Markets
North America (Ex-US)
Middle East & Africa
Income Analysis
SCHD Income Profile
High dividend income from US quality companies. Focus on sustainable dividends from financially healthy US corporations with strong dividend growth history.
VXUS Income Profile
Surprisingly high yield from international markets. Many international companies pay higher dividends, but currency fluctuations affect USD-denominated income.
Sector Allocation
SCHD Sectors (US Focus)
VXUS Sectors (Global Ex-US)
Top 5 Holdings
SCHD Top Holdings (US)
VXUS Top Holdings (Global Ex-US)
Investment Recommendation
🎯 Choose SCHD If:
- Higher current income is important (3.27% vs 3.02%)
- You prefer US-focused quality dividend growth
- Better historical returns matter (11.2% vs 4.8%)
- You want lower expense ratio (0.06% vs 0.08%)
- Dividend growth is a priority (8.5% vs 4.2%)
- You're focused on US market opportunities
- You want quality screens and financial health filters
- Currency risk is a concern (SCHD has none)
🌍 Choose VXUS If:
- Geographic diversification is your priority
- You want exposure to 47 countries outside the US
- Emerging market growth potential appeals to you
- Currency diversification is important
- You want exposure to lower valuations (P/E 12.8 vs 15.2)
- You're building a globally diversified portfolio
- You want to hedge against US market underperformance
- You believe in mean reversion between US and ex-US markets
💡 Portfolio Construction Strategy
Most investors use SCHD and VXUS together in a complementary strategy. Consider VTI (US total market) as your core holding (40-50%), with SCHD for US quality income tilt (20-30%) and VXUS for international diversification (20-30%). For US-focused investors, 70-80% SCHD + 20-30% VXUS works well. For global diversification, 40% VTI + 30% SCHD + 30% VXUS provides balanced exposure.