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History Says This ETF Is a Fantastic Buy-and-Hold Investment — and It Could Turn $100 per Month Into $359,492
This dividend ETF has delivered surprisingly strong growth for the past 15 years.
High-yield dividend stocks are often discussed as being "safer" or "steadier" than tech stocks — but that relative sense of safety comes at a price. Dividend stocks often don't grow as fast as the best tech stocks. That's because companies that pay strong dividends tend to be mature, well-established companies. They have strong business models and solid balance sheets, but they're unlikely to see their share prices skyrocket as some of the best artificial intelligence (AI) stocks have in recent years.
However, if you're feeling nervous about AI stocks and want to diversify some of your investments into a different part of the market, buying high-yield dividend exchange-traded funds (ETFs) could be a good strategy. The Schwab U.S. Dividend Equity ETF (SCHD -0.65%) is one of the best dividend index funds.
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Dividend Equity ETF (SCHD) Touches New 52-Week High
Schwab U.S. Dividend Equity ETF SCHD is probably on the radar for investors seeking momentum. The fund just hit a 52-week high and jumped 37.1% from its 52-week low price of $26.41 per share.
Are more gains in store for this ETF? Let us take a quick look at the fund and the near-term outlook to get a better idea of where it might head.
This fund tracks the total return of the Dow Jones U.S. Dividend 100 Index, as closely as possible. The product charges 6 basis points in annual fees (You can see all Style-Box Large-Cap ETFs here).
The fund likely reached a new 52-week high due to a strategic sector rotation toward high-quality dividend stocks. Amid ongoing market volatility and valuation concerns in tech, investors must have favored SCHD's low-beta, defensive portfolio lately. Robust earnings from key holdings across the consumer staples, healthcare and energy sectors, coupled with strong dividend growth fundamentals and consistent quarterly payouts, likely bolstered investor interest in this income-focused fund.
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