While high dividend yields attract some investors, a focus solely on yield can be misleading, as funds like SCHD and VYM prioritize different aspects of investment.
Vanguard’s VYM offers an annualized return of 9.8% over the past five years, which may justify its lower yield for some investors, but SCHD’s yield remains appealing.
The Schwab U.S. Dividend Equity ETF (SCHD) has established itself with a trailing 12-month yield of 3.30%, outpacing Vanguard’s 2.74%, offering more robust cash flow.
Understanding the differences between dividend ETFs like SCHD and VYM is crucial as each fund's strategy impacts overall returns, thus influencing long-term investment decisions.
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