SCHD vs Gold Commodities Calculator
Compare the investment performance of SCHD ETF and Gold over time with customizable parameters
Calculator Settings
Starting investment amount
Regular monthly investment
Duration of investment comparison
SCHD Parameters
Current annual dividend yield of SCHD (3.91% as of May 2025)
Expected annual dividend growth rate (historical: ~11.44%)
Expected annual price growth rate
Gold Parameters
Expected annual return for gold (historical: ~7-8%)
Annual cost for physical gold storage or ETF management fee
Economic Parameters
Expected annual inflation rate
Expected tax rate on investment gains
Results Summary
SCHD Final Value
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Gold Final Value
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SCHD Total Return
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Gold Total Return
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Annual Dividend Income (Final Year)
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Passive income from SCHD
Final Yield on Cost
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Based on initial investment
Performance Difference
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Key Insight
Enter your investment parameters and click Calculate to see a comparison between SCHD ETF and Gold Commodities.
Inflation Impact
Inflation-Adjusted SCHD Value:
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Inflation-Adjusted Gold Value:
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Inflation-Adjusted Dividend Income:
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Cumulative Inflation Impact:
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Visualization
Investment Value Comparison
Key Benefits Comparison
SCHD Benefits
- Passive income through dividends
- Dividend growth potential
- More predictable returns
- Lower volatility than gold
- Companies adapt to inflation
Gold Benefits
- Traditional inflation hedge
- Portfolio diversification
- Performs well in crises
- Not directly tied to markets
- Physical asset ownership
Year-by-Year Analysis
| Year | SCHD Value | Gold Value | Annual Dividend | Yield on Cost | Inflation-Adj SCHD | Inflation-Adj Gold |
|---|
Understanding SCHD vs Gold Investments
What is SCHD?
The Schwab U.S. Dividend Equity ETF (SCHD) is an exchange-traded fund that tracks the Dow Jones U.S. Dividend 100 Index. It focuses on high-quality, dividend-paying U.S. stocks with a strong record of consistently paying dividends.
Key Features of SCHD:
- Low expense ratio (0.06%)
- Focus on quality dividend-paying companies
- History of dividend growth (~11.44% 5-year dividend growth rate)
- Quarterly dividend payments
- Diversification across sectors
SCHD selects stocks based on fundamental quality metrics including cash flow to total debt ratio, return on equity, dividend yield, and consistent dividend growth history.
What is Gold as an Investment?
Gold is a precious metal that has been valued as a store of wealth for thousands of years. As an investment, it can be purchased in physical form (bullion, coins) or through financial products like ETFs, futures, and mining stocks.
Key Features of Gold:
- Historically used as a hedge against inflation
- No passive income generation (no dividends or interest)
- Tends to perform well during economic uncertainty
- Storage costs for physical gold
- Can be volatile in short-term periods
Gold's value is driven by multiple factors including inflation expectations, currency strength, central bank policies, and global economic uncertainty.
Key Comparison Factors
| Factor | SCHD | Gold |
|---|---|---|
| Income Generation | Generates quarterly dividends | No passive income |
| Inflation Protection | Moderate - Companies can adjust prices | Strong - Traditional inflation hedge |
| Growth Potential | Both price appreciation and dividend growth | Price appreciation only |
| Volatility | Moderate - Tied to stock market | High - Can have significant price swings |
| Costs | Low - 0.06% expense ratio | Varies - Storage/insurance costs or ETF fees |
| Tax Treatment | Qualified dividends (typically 15-20% tax) | Collectibles tax (up to 28% for physical gold) |
Historical Performance Perspective
SCHD Performance Highlights
- Since inception in 2011, SCHD has delivered solid returns with lower volatility than the broader market
- During the 2020 pandemic market crash, SCHD declined less than the S&P 500
- SCHD has consistently grown its dividend since inception
- Tends to underperform during strong growth-oriented markets but outperform in value-oriented markets
Gold Performance Highlights
- Gold reached an all-time high in 2020 during peak pandemic uncertainty
- Gold typically performs well during periods of economic uncertainty and inflation
- Gold has historically had low correlation with stock market returns
- During the 2008 financial crisis, gold provided positive returns while stocks plummeted
Investment Strategy Considerations
When deciding between SCHD and Gold, consider:
- Your income needs - SCHD provides regular dividend income while gold does not
- Time horizon - Longer investment periods have historically favored dividend-growing equities
- Portfolio diversification - Gold can provide uncorrelated returns to stock market investments
- Economic outlook - Gold may outperform during high inflation or economic crisis periods
- Tax considerations - Different investment vehicles have different tax implications
Note: Many financial advisors recommend a balanced approach with allocation to both dividend stocks like those in SCHD and alternative assets like gold as part of a diversified portfolio.
Frequently Asked Questions
Which has historically performed better, SCHD or Gold?
Over long time periods (10+ years), dividend-paying stocks like those in SCHD have generally outperformed gold. However, gold has had periods of strong outperformance during economic crises and high inflation. Since SCHD's inception in 2011, SCHD has generally outperformed gold, but this varies in different economic cycles.
Is SCHD or Gold better for inflation protection?
Gold is traditionally considered a stronger inflation hedge in the short term, especially during periods of rapidly rising inflation or currency devaluation. However, over longer periods, quality dividend stocks like those in SCHD can provide inflation protection as companies raise prices and increase their dividends. The best approach for inflation protection may be having exposure to both.
Should I invest in both SCHD and Gold?
Many financial advisors recommend diversification across different asset classes. Including both SCHD (for dividend income and growth) and some allocation to gold (for diversification and crisis protection) can be part of a well-balanced portfolio. The optimal allocation depends on your specific financial goals, time horizon, and risk tolerance.
What is the best way to invest in gold?
There are several ways to invest in gold, each with pros and cons:
- Physical gold (coins, bars): Provides direct ownership but has storage costs and security concerns
- Gold ETFs (like GLD, IAU): Offer easy trading and no direct storage costs but have expense ratios
- Gold mining stocks/ETFs: Potential for higher returns with higher risk and correlation to the stock market
- Futures and options: For sophisticated investors, offering leverage but with higher complexity and risk
How much of my portfolio should be in SCHD vs. Gold?
Common allocations for gold typically range from 5-15% of a portfolio, while dividend stocks may comprise 20-60% depending on your income needs and risk tolerance. Younger investors with longer time horizons might favor a higher allocation to dividend stocks like SCHD, while those near or in retirement might increase gold allocation for stability. Consulting with a financial advisor for personalized guidance is recommended.
Does gold provide any income like SCHD's dividends?
No, physical gold and most gold ETFs do not provide any income. Gold is primarily a store of value and potential appreciation asset. Unlike SCHD, which pays quarterly dividends that can be spent or reinvested, gold requires selling a portion of your holdings to generate cash flow. This is one of the key differences between the two investment types and an important consideration for income-focused investors.