Vanguard Dividend Appreciation ETF (VIG 1.02%) and Schwab U.S. Dividend Equity ETF (SCHD 0.21%) stand out for their low costs and focus on dividend growth, but SCHD’s yield more than doubles VIG’s, while VIG has delivered stronger recent returns and heavier tech exposure.
Both funds aim to provide diversified exposure to U.S. companies with robust dividend track records, but their strategies and sector bets differ. This comparison unpacks how VIG and SCHD stack up on cost, yield, performance, risk, and portfolio construction to help investors pinpoint the best fit for their income and growth goals.
Snapshot (Cost & Size)
| Metric | VIG | SCHD |
|---|---|---|
| Issuer | Vanguard | Schwab |
| Expense ratio | 0.05% | 0.06% |
| 1-yr return (as of Jan. 30, 2026) | 10.4% | 6.6% |
| Dividend yield | 1.6% | 3.5% |
| Beta | 0.85 | 0.77 |
| AUM | $103.1 billion | $77.3 billion |
Beta measures price volatility relative to the S&P 500; beta is calculated from five-year weekly returns. The 1-yr return represents total return over the trailing 12 months.
SCHD carries a marginally higher expense ratio than VIG, but the difference is only 0.01 percentage points—practically negligible for most investors. Where SCHD stands out is its much higher dividend yield, offering a substantially larger payout than VIG.
Performance & Risk Comparison
| Metric | VIG | SCHD |
|---|---|---|
| Max drawdown (5 y) | -20.39% | -16.86% |
| Growth of $1,000 over 5 years | $1,617 | $1,393 |
What's Inside
SCHD tracks 101 U.S. companies screened for dividend strength and quality, with the fund now over 14 years old. Its biggest sector allocations are energy (19%), consumer defensive (18%), and healthcare (18%). The top holdings include Lockheed Martin Corp (LMT +0.64%), Texas Instrument Inc (TXN 4.03%), and Chevron Corp (CVX +3.67%), giving the portfolio a notable tilt toward industrials and oil majors.
VIG, by contrast, spreads its assets across 338 holdings, favoring technology (28%), financial services (21%), and healthcare (17%). Its largest positions—Broadcom Inc (AVGO 1.32%), Microsoft Corp (MSFT 0.43%), and Apple Inc (AAPL 2.23%)—mean more tech exposure and a broader diversification. While both funds avoid quirks like leverage or currency hedging, their sector bets and portfolio depth set them apart for different investor preferences.
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What This Means For Investors
Vanguard Dividend Appreciation ETF (VIG) and Schwab U.S. Dividend Equity ETF (SCHD) are two funds worth considering for income-oriented investors. Here’s what you need to know.
For starters, the funds are alike in many important ways: Their expense ratios are nearly identical and are both quite affordable — VIG gets a slight edge with its 0.05% rate. Both funds also have significant size, with each having AUM of more than $77 billion. Again, VIG is slightly larger. Yet, given the size of the funds, liquidity shouldn’t be an issue for any investor looking to buy or sell shares. Finally, both funds target dividend-paying stocks.
This, however, is where some differences begin to appear. VIG and SCHD target this sector in contrasting ways. VIG holds more technology and financial services stocks. The dividend yield of stocks from these sectors tend to be lower than other industries. This explains why VIG’s dividend yield is 1.6%, whereas SCHD boasts a dividend yield of 3.5%. SCHD, with its higher yield, has more consumer staples and energy exposure.
In short, SCHD delivers more yield and income, while VIG relies more on stock appreciation. Both approaches can work, yet, for income-focused investors, SCHD delivers more pure income, even if it comes at the cost of lower overall returns.
