SCHD ETF Analysis: The Most Complete Schwab US Dividend Equity ETF Breakdown

Oct 13, 2026 · Schwab US Dividend Equity ETF (NYSE Arca: SCHD) · 32:10 video

By a former derivatives trader with 10 years experience at three of the world's largest investment banks.

The full breakdown runs 32:10. The written version below covers the numbers.

On October 5, 2026 the 10-year Treasury paid 2.09 percentage points more than the Schwab US Dividend Equity ETF's dividend yield, the biggest gap in SCHD's 15-year history. A 3-month T-bill pays more too. Investors still put more than $18 billion into SCHD in 6 months.

What SCHD owns

SCHD tracks an index built from 4 screens for dividend quality, with a 4% cap on any single stock that's reset each March. Its 2 biggest holdings today are chip stocks, and a big slice of the fund is an oil bet, which is a large part of why it beat the S&P 500 earlier in 2026.

Why the 5% 10-year broke it

Income stocks and bond yields sit on a seesaw. When the 10-year pushed through 5%, SCHD fell 6.9% while the S&P 500 was flat, and every dividend fund (SPHD, DVY, VYM, DGRW) took the same hit. Fewer than 4% of S&P 500 stocks now out-yield the 10-year, and SCHD's dividend growth has stalled at 0.6%.

SCHD vs Treasuries

With a 30-year Treasury at 5.60% and a 3-month T-bill at 4.05%, the after-tax math depends on the account. In an IRA the Treasury wins on income today. In a taxable account, qualified dividends can fall in the 0% bracket, and dividend growth is the part a bond can't give you.

After every yield top

Dividend stocks have rallied hard after long-term yields topped: SCHD was up 13.5% after the 2018 top and 28.2% after 2023, though the S&P 500 did better at 38.9%. The exception was 2007, when the yield top came right before the financial crisis.

What decides it

Whether SCHD turns depends on whether long-term yields are topping. The 3 dates in the video are CPI, the Fed and the November 4 Treasury refunding.

Whether yields are topping is in TLT ETF Analysis.

Sources: Schwab SCHD summary prospectus (SEC 497K, Feb 27, 2026) and ETF Report Card (through Oct 9, 2026); FRED (DGS10, DGS30, DTB3, DFII10); BLS September 2026 employment report; IRS Rev. Proc. 2025-32. Nothing here is investment advice.