FDVV - FDVV: I Prefer This Dividend Fund Over SCHD Due To Tech Weight

2024-05-12 08:26:33 ET

Summary

• Fidelity High Dividend ETF is an excellent dividend ETF alternative to the popular Schwab Dividend Equity ETF.
• The current dividend yield sits at 3.2% and the dividend has increased at a double-digit CAGR over the last 3-year period.
• FDVV has remained resilient through fluctuations in interest rate changes and volatile markets from the pandemic.
• The Fund has outperformed SCHD over the last 3 years, and I believe this to be due to the heavier weighting towards the tech sector.

Overview

I previously covered Fidelity High Dividend ETF ( FDVV ) in October 2023. Since then, the performance has stayed on par with the S&P 500 ( SPY ) in total return while simultaneously outperforming the community favorite dividend ETF, Schwab U.S. Dividend Equity ETF ( SCHD ). I believe that this outperformance has a lot to do with the different portfolio structure that allows FDVV to capture more price upside. Now that the current market conditions have shifted with higher inflation, a strong job market, and a prolonged period of interest rates, I thought it would be a good time to provide an update on my outlook as well as why I believe that a dividend ETF like this is a great option to ride out shifting markets....

For further details see: