PFM vs SCHD

PFMCInvesco Dividend Achievers ETF

SCHDASchwab U.S. Dividend Equity ETF

In short

PFM A 2005-vintage dividend fund that casts a wide net: roughly 400 US dividend payers from the Nasdaq Dividend Achievers family, held close to the index. The trade-off is price, in a corner of the market that has gotten very cheap.

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

PFM The Fund seeks to replicate the NASDAQ US Broad Dividend Achievers Index before fees and expenses and normally invests at least 90% of assets in dividend-paying common stocks in that Index.

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

• PFM Wide net, not a narrow screen: about 400 US dividend payers, with at least 90% of assets in the common stocks of its Nasdaq Broad Dividend Achievers index.
• Trading since 2005, so the record spans several market cycles. Dividends are passed through quarterly.
• Sticks to the script. The portfolio has stayed tight to the index it promises to replicate, which is the entire job description for a fund like this.

• 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

• PFM 0.52% a year sits above the median for its dividend-screen peers, and the category's anchors (VIG at 0.04%, SCHD at 0.06%) charge a small fraction of that.
• Thinly traded next to the category's giants, so limit orders and patience matter more here than they would in a household-name dividend fund.
• Overall it lands in the lower half of its dividend-screen peer group, driven by cost and trading friction rather than by how it runs the index.

• 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 PFM profile⁠

Full SCHD profile⁠