Reassessing US Dividend Stocks - SCHD Underperformance Does Not Mean All US Dividends Failed

🚨 Correcting a Misconception

Korean investors' sentiment toward US dividend stocks has hit rock bottom. This is due to SCHD's prolonged underperformance.

But SCHD underperforming doesn't mean US high-dividend stocks are underperforming.

📊 US Major Dividend ETF Performance Comparison

2025 Year-to-Date Performance

ETF	Return	Feature
S&P 500 (SPY)	+15.6%	Benchmark
VYM	+8.2%	High dividend (Vanguard)
DVY	+10.5%	Dividend select
HDV	+7.8%	High dividend (BlackRock)
RISE TOP10	+13.2%	Dow Jones TOP10
SCHD	-0.8%	Underperforming

Only SCHD is notably underperforming. Other US dividend ETFs show solid returns.

🤔 Why Only SCHD Underperforms?

1. Methodology Specifics

SCHD isn't just a simple high-dividend ETF:

• Dividend consistency
• Financial health
• Dividend growth rate
• Complex quant screening

This methodology is working against it in current market conditions.

2. Sector Composition Issues

SCHD sector weights:

• Financials: High
• Industrials: High
• Tech: Low

With tech leading markets in 2024-2025, low tech exposure created relative underperformance.

3. Specific Holdings Underperformance

Some top SCHD holdings recorded below-market returns.

💡 Break the "US Dividends = SCHD" Equation

Because Korean investors overwhelmingly hold SCHD:

"SCHD underperformance = US dividend stock failure"

This misconception has spread.

Reality:

• US dividend ETF performance varies widely
• Multiple alternatives to SCHD exist
• Methodology differences create performance gaps

📈 Alternative ETF Performance

High-Dividend Category

• VYM: Vanguard high dividend, stable
• HDV: BlackRock high dividend, defensive
• DVY: Dividend select, aggressive

New Alternatives

• RISE TOP10: Dow Jones high-dividend 10 stocks, simple and powerful
• Tech Dividend ETFs: Growth + dividend simultaneously

🎯 Need for Portfolio Diversification

Old Approach (Problem)

US Dividends = 100% SCHD

→ Single methodology risk

Improved Approach

US Dividends = 50% SCHD + 25% VYM + 25% RISE TOP10

→ Methodology diversification, sector diversification

💰 Significance of US Dividend Investing

1. Portfolio Diversification

• Low correlation with Korean stocks
• Balance with growth stocks

2. Dollar Asset Accumulation

• Currency hedge effect
• Global asset allocation

3. Stable Cash Flow

• Quarterly dividends
• Retirement income source

4. Dividend Growth

• US corporate shareholder return culture
• Compounding effect for long-term holders

⚠️ Investment Checkpoints

1. Understand the Methodology

   • Know each ETF's stock selection criteria
   • Check alignment with your investment philosophy

2. Review Sector Composition

   • Check for sector concentration
   • Fit with current market environment

3. Compare Costs

   • Total Expense Ratio (TER)
   • Trading costs

4. Diversify

   • Avoid single ETF concentration
   • Diversify by methodology

📝 Conclusion

SCHD underperformance = US dividend failure?

→ Absolutely not.

US dividend ETF performance varies widely. There's no reason to view all US dividends negatively just because SCHD underperforms.

This is actually a great opportunity to re-examine your portfolio and explore various alternatives.

• Trust SCHD → Keep it
• Need alternatives → Consider RISE TOP10, VYM, etc.
• Both → Parallel investment for diversification

With sentiment toward US dividend investing at lows, this is exactly when you should make decisions based on cold, hard data. 🙏