Dividend investors love SCHD, Schwab U.S. Dividend Equity ETF. Should I sell my individual stocks and place all my capital in SCHD? Today's video shares my analysis of SCHD, and six unique characteristics I love about this ETF. While I won't be selling any stocks, I do see myself establishing a position in SCHD in the future.
#schd #dividend #etf

Timestamps:
0:00 INTRODUCTION: Dividend growth investors love SCHD. Should I sell my individual stocks and just own SCHD instead?
0:15 Charles Schwab SCHD performance has been 12.73% per year, on average (last 10 years).
0:57 Dow Jones U.S. Dividend 100 Index Underlying index has delivered 11.97% per year, on average. This is higher than the S&P 500 (total returns).
1:54 If I buy this ETF, I will use the dividends right away to pay bills (no reinvestment for me, as far as SCHD goes).
2:02 Without dividends reinvested, the Dow Jones U.S. Dividend 100 Index has driven 8.36% per year, on average.
2:57 SEGMENT 1: WHY I LIKE SCHD
2:58 REASON 1: SCHD OFFERS 100 QUALITY DIVIDEND STOCKS
3:43 This is a quality dividend ETF, based on performance.
3:59 They have 46 pages of dividend stock selection criteria.
4:35 Turnover is low.
4:51 REASON 2: BROAD DIVERSIFICATION INTO DIVIDEND STOCKS I DON’T HAVE
5:02 Top 26 Stocks In SCHD (I only own about 31% of them!)
6:16 I only own 31% of the stocks in SCHD, but I actually think the real number is lower (because of position weighting).
6:50 Diversification is more important than ever before.
7:07 REASON 3: I CAN USE SCHD TO PAY MY BILLS RIGHT NOW
7:23 I have a hard time using dividends from my core stocks to pay bills. (I reinvest.) With SCHD, I would not mind just pulling dividends for bills. It’s psychological.
8:16 REASON 4: I HATE SELLING STOCKS (SCHD does this for me, without me having to see!)
8:23 It was really painful selling NSC.
0:57 I don't like seeing stocks sold, but I don't have to see it with SCHD.
10:13 REASON 5: DAMPEN VOLATILITY IN MY PORTFOLIO
10:20 I bought Treasuries to provide cash flow while lowering portfoliowide volatility. I see the same effect with SCHD.
11:08 REASON 6: AUTOMATION OF INVESTING (Less daytoday management work for me.)
11:55 I'm not going to sell my stocks and redeploy into SCHD, but on a goforward basis, I see myself buying and adding to SCHD.
12:11 SEGMENT 2: SCHD FINANCIAL METRICS ANALYSIS
12:20 Only 12% off 52week high, which is amazing.
12:35 Low PE of 14.91.
12:46 Starting yield of 3.6% (based on TTM dividends). 3.96% based on forward anticipated yield.
13:08 They are growing the dividend by 13.7% per year, on average. This is HUGE. Although, I expect it to slow down.
13:21 Expense ratio is only 0.06%.
14:15 SEGMENT 3: $100,000 IN SCHD (HOW MUCH DIVIDEND INCOME?)
15:10 SEGMENT 4: QUALIFIED DIVIDENDS FROM SCHD
16:12 SEGMENT 5: SECTOR ALLOCATION FOR SCHD (AND MARKET CAP ALLOCATION)
17:37 DISCLOSURE AND DISCLAIMER

DISCLOSURE: I am long PepsiCo (PEP), CocaCola (KO), The Home Depot (HD), IBM (IBM), Pfizer (PFE), Altria (MO), 3M (MMM), and KimberlyClark (KMB). I’m also long Treasuries. I may initiate a position in SCHD.

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