FDL vs SCHD

FDLCFirst Trust Morningstar Dividend Leaders Index Fund

SCHDASchwab U.S. Dividend Equity ETF

In short

FDL FDL doesn't weight by company size or by yield. It weights by dividend dollars, so America's biggest cash payers carry the most weight. Roughly 100 high-yield names, screened for payouts they can keep funding, running since 2006.

SCHD The dividend fund that checks the balance sheet before it checks the yield. SCHD only considers companies with 10 straight years of payouts, then ranks the survivors on cash flow, return on equity and dividend growth. Quality gate first, income second, at six basis points.

Stated mandate

FDL The fund is an exchange-traded index fund seeking to replicate the price and yield of the Morningstar Dividend Leaders Index before fees and expenses.

SCHD The fund seeks to track, before fees and expenses, the total return of the Dow Jones U.S. Dividend 100TM Index.

Why people hold it

• FDL Weight follows the checkbook: positions are sized by the dollar value of dividends paid, with any single name capped at 10% and all 5%-plus names capped at 50% combined.contentstack.io
• The screen is about payout durability, not just headline yield: stocks need a consistent payment record and the ability to sustain it before the top 100 yielders are taken.yahoo.com
• Trading since 2006, a multi-billion-dollar fund that changes hands actively and pays on a quarterly schedule.
• Lands in the upper half of a US dividend-screen peer group of roughly 50 funds.

• SCHD Charges 0.06% a year, near the floor for US equity ETFs and a fraction of what the typical dividend-screen fund costs.schwabassetmanagement.com
• The rulebook is strict: 10 consecutive years of dividends to qualify, then a composite rank on cash-flow-to-total-debt, return on equity, yield and five-year dividend growth.spglobal.com
• Index rules cap any single stock at 4.5% and any sector at 25%, so one hot name cannot quietly become the whole income stream.spglobal.com
• Running since 2011 and now among the largest, most heavily traded dividend ETFs, with tracking that stays very close to its index.

Worth knowing

• FDL At 0.43% it costs more than the cheap index heavyweights in the group (VIG 0.04%, SCHD 0.06%, DGRO 0.08%) and sits a little above the peer median.
• Concentrated by design: about 100 names, non-diversified, and the dividend-dollar math tilts toward the mega-caps and sectors writing the biggest checks.yahoo.comcontentstack.io
• Yield-first, not dividend-growth. The portfolio looks different from growth-screened peers like VIG and DGRO, which start from rising payouts instead of high ones.yahoo.com

• SCHD Roughly 100 names, every one a long-time dividend payer. The fast-growing non-payers that drive much of the US market are not eligible, by design.spglobal.com
• The yield and quality screens tilt it toward mature, cash-generating sectors, so it looks nothing like a total-market fund. Distributions land quarterly, not monthly.spglobal.com
• Not the absolute cheapest shelf item: VIG runs 0.04% and DIVB 0.05%, though both screen for dividends differently.

Full FDL profile⁠

Full SCHD profile⁠