SCHD ETF Is Beating VOO and QQQ This Year Despite Limited AI Exposure
The Schwab US Dividend Equity ETF (NYSE: SCHD ) is hovering near its all-time high and is beating the S&P 500 and Nasdaq 100 in terms of total returns this year, a sign that there is demand for value stocks. SCHD ETF’s Total Return is Better Than VOO and QQQ This Year SCHD’s total return this year is 20%, while the Invesco QQQ Trust (NASDAQ: QQQ ) and Vanguard S&P 500 ETF (NYSE: VOO ) have jumped by 16% and 10%, respectively. The fund has performed well despite having limited exposure to high-growth sectors such as artificial intelligence (AI). Consumer staples is its largest sector allocation, accounting for 20% of the portfolio. It is followed by healthcare, energy, and industrials, giving the fund a more defensive sector mix. Read Also: Spotify Stock is Down 38% From All-Time High, But One Analyst Sees a 40% Upside The biggest companies in the SCHD ETF are firms like Home Depot, Me...
The Schwab US Dividend Equity ETF (NYSE: SCHD ) is hovering near its all-time high and is beating the S&P 500 and Nasdaq 100 in terms of total returns this year, a sign that there is demand for value stocks.
SCHD ETF’s Total Return is Better Than VOO and QQQ This Year SCHD’s total return this year is 20%, while the Invesco QQQ Trust (NASDAQ: QQQ ) and Vanguard S&P 500 ETF (NYSE: VOO ) have jumped by 16% and 10%, respectively.
The fund has performed well despite having limited exposure to high-growth sectors such as artificial intelligence (AI).
Consumer staples is its largest sector allocation, accounting for 20% of the portfolio.
It is followed by healthcare, energy, and industrials, giving the fund a more defensive sector mix.
Read Also: Spotify Stock is Down 38% From All-Time High, But One Analyst Sees a 40% Upside The biggest companies in the SCHD ETF are firms like Home Depot, Merck & Co, UnitedHealth Group, Amgen, and Abbott Laboratories.
The only large companies with exposure to the AI sector are Qualcomm and Texas Instruments.
SCHD may become a major beneficiary if investors start rotating from growth companies to value ones.
There are signs that this shift is already happening, with the popular Magnificent 7 ETF (MAGS) falling by over 8.5% from the year-to-date high.
This trend may continue once investors fall out of love with the fast-growing companies like Micron and SanDisk.
SCHD has had over $13.23 billion in inflows in the last 12 months, bringing its total assets under management to nearly $100 billion.
It is also relatively cheap, with its price-to-earnings ratio being 18, lower than S&P 500 Index’s 23.
Its price-to-book and price-to-cash flow ratios being 3.84 and 10.9, respectively.
Technicals Suggest That the SCHD Stock Has More Upside Ahead SCHD stock chart | Source: TradingView There are signs that SCHD, which is a popular dividend fund, has more upside to go in the near term.
The daily chart shows that the stock remains above the ascending trendline that links the lowest levels since April this year.
It has also formed a cup-and-handle pattern and is now in the handle section.
C&H often leads to more gains over time.
It remains above the 100-day Exponential Moving Average (EMA), which has supported it since November last year.
Therefore, technicals suggest that the stock will continue rising in the near term, with the initial target being the year-to-date high of $32.92.
A move above that level will point to further gains, potentially to $35.
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