SCHD vs SPHD Comparison Calculator

Based on historical performance, SCHD has demonstrated superior long-term total returns compared to SPHD. Over the past 5 years, SCHD has generated an annualized return of approximately 14.29% versus 8.54% for SPHD. Since inception, SCHD has returned 12.73% annually compared to SPHD's 8.92%.

Several factors contribute to SCHD's outperformance:

• Lower expense ratio (0.06% vs 0.30% for SPHD)
• Focus on quality companies with strong fundamentals
• Greater exposure to sectors with better growth prospects
• Superior dividend growth (11.44% annually vs 3.85% for SPHD)

While past performance doesn't guarantee future results, SCHD's quality-focused approach and lower expenses provide a solid foundation for continued long-term outperformance. For investors with a time horizon of 5+ years, SCHD has historically been the better choice for total return potential.

SPHD generally offers better current income with a higher yield (4.82% vs 3.91% for SCHD) and monthly dividend payments rather than quarterly distributions. This makes SPHD potentially more suitable for investors who prioritize immediate income, particularly retirees or those needing regular cash flow.

Key advantages of SPHD for income investors include:

• Higher current yield provides more immediate income
• Monthly distribution schedule offers more frequent payments
• Lower volatility focus can provide more stable income during market turbulence

However, it's important to note that SCHD's dividend growth rate significantly outpaces SPHD's. This means that while SPHD provides more income initially, SCHD's income stream grows faster over time and eventually surpasses SPHD's. In our analysis, this crossover typically occurs around the 7-9 year mark. Therefore, investors with longer time horizons may benefit more from SCHD's growing income stream, while those with immediate income needs may prefer SPHD's higher initial yield and monthly payments.

The expense ratio difference between SCHD (0.06%) and SPHD (0.30%) may seem small, but it creates a significant impact on long-term returns through compounding.

For a $10,000 investment over 30 years, assuming both funds earned a hypothetical 8% gross return before expenses:

• SCHD (0.06% expense): Final value ≈ $98,499 (7.94% net return)
• SPHD (0.30% expense): Final value ≈ $90,627 (7.70% net return)
• Difference: $7,872 (7.99% more wealth with SCHD)

The expense ratio difference of 0.24% translates to a performance gap of about 0.24% annually, which compounds over time. This expense advantage is one of the key factors contributing to SCHD's superior long-term performance.

Additionally, SCHD's lower expenses mean that more of the dividend income goes directly to investors rather than to fund management, enhancing the effective yield over time.

Despite SPHD's low volatility focus, both ETFs have demonstrated similar drawdown patterns during major market corrections, with slight performance differences depending on the nature of the downturn.

During the COVID-19 crash in Q1 2020:

• SCHD drawdown: -33.37%
• SPHD drawdown: -35.92%
• Recovery time: 114 trading days for SCHD vs 187 for SPHD

However, during the 2022 bear market:

• SCHD return: -5.73%
• SPHD return: +0.57%

SPHD has generally performed better during interest-rate driven downturns due to its higher allocation to defensive sectors like utilities and consumer staples. Meanwhile, SCHD has demonstrated stronger recovery patterns after market bottoms due to its quality focus and greater exposure to economically sensitive sectors. Overall, SPHD shows slightly lower volatility measures (beta of 0.80 vs 0.88 for SCHD), but the practical downside protection difference is relatively modest during major market corrections.

Yes, holding both SCHD and SPHD can be a valid strategy for investors seeking to balance current income with long-term growth. This approach creates a complementary dividend portfolio that addresses different investment objectives:

• SPHD provides higher current income with monthly distributions
• SCHD delivers stronger dividend growth and total return potential
• The combination provides sector diversification across different dividend-paying industries
• Monthly income from SPHD paired with quarterly payments from SCHD creates a more regular cash flow

A common allocation approach based on time horizon:

• Accumulation phase: Favor SCHD (70-80%) with smaller SPHD allocation (20-30%)
• Pre-retirement (5-10 years before): More balanced allocation (50-60% SCHD, 40-50% SPHD)
• Retirement phase: Consider increasing SPHD allocation (40-60%) for higher immediate income

This balanced approach allows investors to benefit from both the superior long-term growth of SCHD and the higher current yield of SPHD, creating a more resilient income portfolio across different market environments.