DGRO Beats SCHD with 250% Total Return Over 10 Years
Although SCHD offers a higher current dividend yield, DGRO has outperformed in total return over the past ten years, delivering 250% versus SCHD's 233%.
Key Numbers
For pre-retirees deciding between dividend ETFs, SCHD (Schwab U.S. Dividend Equity ETF) often appears attractive due to its higher yield. However, total return figures tell a different story: the iShares Core Dividend Growth ETF (DGRO) has delivered a 250% total return over the past decade, outperforming SCHD's 233%.
Investment Philosophy Difference
DGRO focuses on future dividend growth rather than current yield, allowing it to invest in high-quality companies with lower current payouts. This looser quality filter enables greater capital appreciation over time.
Long-Term Performance
Over 10 years, DGRO outperformed SCHD by 17 percentage points in total return. A $100,000 investment in DGRO would have grown to $350,000, compared to $333,000 for the same amount in SCHD.
What This Means for Investors
For investors seeking long-term growth with increasing dividends, DGRO may be a better choice than SCHD, especially for horizons beyond 5-10 years. However, SCHD remains suitable for those needing higher current income.
Frequently Asked Questions
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