Is the Schwab U.S. Dividend Equity ETF a Smarter Buy Than VOO Right Now?

For 3 years, the Vanguard S&P 500 ETF (NYSEMKT: VOO) was 1 of the champion performers successful the U.S. equity market. Its overweight successful tech and maturation stocks was much than capable to present stellar returns for investors who simply wanted vulnerability to the full market.

This twelvemonth the marketplace has rotated into value, defensive, and dividend stocks portion the broader marketplace has struggled to enactment successful the green. As of March 27, the Schwab U.S. Dividend Equity ETF (NYSEMKT: SCHD), which invests heavy successful these kinds of stocks, was up 11% twelvemonth to date, portion the Vanguard S&P 500 ETF was down astir 1%.

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That's a meaningful spread successful a abbreviated period, and it's astir a cleanable reversal of what happened from 2023 to 2025. But tin the 2026 inclination continue?

This ETF is performing good owed to its vigor and antiaircraft exposures. In its 2025 yearly reconstitution, it astir doubled its allocation to vigor earlier it went connected its existent run. Overweight positions successful user staples and industrials besides contributed. These changes weren't needfully viewed positively by investors arsenic they happened, but they proved lucrative during the months that followed.

After the Schwab U.S. Dividend Equity ETF completed its astir caller reconstitution successful March, here's what the "new" portfolio looks similar today.

Data source: Schwab.

Energy is inactive a large portion of the portfolio, but it's down from its erstwhile 20% allocation. Consumer staples and healthcare relationship for 38% of the fund, giving it a antiaircraft lean. Technology's weighting is modest, but it's been increasing implicit the past fewer years.

Overall, the money looks mostly the aforesaid present arsenic it did earlier its reconstitution, erstwhile it was generating large returns.

The 1 happening that we've seen passim 2026 is volatility.

With fewer exceptions, the U.S. banal marketplace featured a reasonably dependable way of affirmative returns. The other has been existent this year. Value, defensive, and small-cap stocks sharply outperformed the S&P 500 successful the archetypal 2 months of the year. But March has seen a crisp reversal of that trend. If the struggle successful Iran gets settled, it's rather imaginable we could spot different reversal aboriginal this year.