Wealthy PotHDV vs SCHD: Two Quality-Screened Dividend Funds That Share Half Their Portfolio
HDV and SCHD overlap by 47.3%, by our calculation from the two funds' latest SEC holdings filings. They hold 28 stocks in common, including Coca-Cola, Merck, Chevron, Verizon, Procter & Gamble, PepsiCo and Home Depot. The other half of each fund is different: HDV's largest holdings are Exxon Mobil and AbbVie, which SCHD does not own, and SCHD's largest are Qualcomm and Texas Instruments, which HDV does not own. The yields are almost the same (3.34% and 3.37%), SCHD is cheaper (0.06% against 0.08%), and neither fund has beaten the other at every horizon.
Table of Contents
The Short Answer
- Overlap: 47.3%. About 54% of each fund's weight sits in stocks the other also owns. Our calculation from Form N-PORT filings for 31 July 2026 (HDV) and 31 May 2026 (SCHD).
- Fees: SCHD 0.06%, HDV 0.08%. On $10,000 the prospectus ten-year cost examples are $77 and $103.
- Yield: a tie, near enough. HDV's 30-day SEC yield was 3.34% on 31 August 2026. SCHD's was 3.37% on 1 October 2026.
- Size: HDV holds 75 stocks, SCHD about 100. HDV is more concentrated: its top ten were 50.98% of the fund on 30 June 2026, against 41.62% for SCHD on 2 October 2026.
- Returns split by horizon. To 30 June 2026 at NAV, SCHD led over one year (24.08% vs 20.67%) and ten years (12.37% vs 9.11% a year). HDV led over three years (14.65% vs 13.52%) and five years (11.11% vs 8.51%).
- Different sector bets. HDV leans on energy and consumer staples. SCHD owns more technology and industrials.
How Much HDV and SCHD Overlap
We matched the two funds' Form N-PORT holdings reports, using the same data as our Portfolio Overlap Checker. The filings are two months apart: SCHD's is for 31 May 2026 and HDV's for 31 July 2026.
| Overlap measure | Result |
|---|---|
| Stocks held by both funds | 28 |
| Share of HDV's weight in stocks SCHD also owns | 54.0% |
| Share of SCHD's weight in stocks HDV also owns | 54.9% |
| Overlap (sum of the smaller weight in each shared stock) | 47.3% |
| Largest shared holdings | Weight in HDV | Weight in SCHD |
|---|---|---|
| Chevron | 6.13% | 3.83% |
| Verizon | 5.51% | 3.65% |
| Procter & Gamble | 4.52% | 3.55% |
| Home Depot | 4.45% | 3.36% |
| Coca-Cola | 4.09% | 3.96% |
| Merck | 3.99% | 3.86% |
| PepsiCo | 3.46% | 3.44% |
| Altria | 3.06% | 2.94% |
| Amgen | 2.71% | 3.47% |
| Bristol-Myers Squibb | 2.70% | 2.93% |
The non-shared halves are where the two funds part ways.
- In HDV but not SCHD (47 stocks, 45.6% of HDV): Exxon Mobil 7.88%, AbbVie 6.16%, Philip Morris 4.44%, Pfizer 4.27%, McDonald's 2.31%, Medtronic 1.73%, and utilities Southern Co 1.59% and Duke Energy 1.53%.
- In SCHD but not HDV (71 stocks, 44.9% of SCHD): Qualcomm 6.74%, Texas Instruments 5.90%, UnitedHealth 5.09%, Accenture 2.90%, ADP 2.25%, Comcast 2.25%, SLB 2.05% and UPS 1.98%.
So owning both is not pointless, but it is not diversification either. Half of what you would buy with the second fund you already own.
HDV vs SCHD Side by Side
| HDV | SCHD | |
|---|---|---|
| Full name | iShares Core High Dividend ETF | Schwab U.S. Dividend Equity ETF |
| Index | Morningstar Dividend Yield Focus Index | Dow Jones U.S. Dividend 100 Index |
| Expense ratio | 0.08% | 0.06% |
| Prospectus cost of $10,000 over 10 years | $103 | $77 |
| Holdings | 74 (2 Oct 2026); index of 75 | 102 lines (2 Oct 2026); index of 100 |
| Top 10 weight | 50.98% (30 Jun 2026) | 41.62% (2 Oct 2026) |
| 30-day SEC yield | 3.34% (31 Aug 2026) | 3.37% (1 Oct 2026) |
| Distributions | Monthly (see below) | Quarterly |
| Portfolio turnover | 65%, latest fiscal year (prospectus) | 30%, fiscal year to Aug 2025 (prospectus) |
| Net assets | $14.56 billion (2 Oct 2026) | $108.67 billion (2 Oct 2026) |
| Indexing method | Representative sampling; the prospectus classifies HDV as "non-diversified" | Generally replicates the index weights |
| Inception | 29 March 2011 | 20 October 2011 |
The distribution line needs a note. iShares now lists HDV's frequency as monthly. Its own distribution history shows quarterly payments through June 2026 and then monthly payments in July, August and September 2026. SCHD pays quarterly.
Two Different Screens
Both funds screen for quality before they reach for yield, but they measure quality in different ways.
SCHD starts from the Dow Jones U.S. Broad Market Index and requires "at least 10 consecutive years of dividend payments," a float-adjusted market cap of at least $500 million and minimum liquidity, according to Schwab's prospectus. It ranks survivors on four accounting measures: "cash flow to total debt, return on equity, dividend yield and 5-year dividend growth rate." It keeps 100 stocks, caps any one at 4.0% and any sector at 25% at each rebalance, and excludes REITs, MLPs, preferred stocks and convertibles.
HDV uses Morningstar's analyst and model ratings in place of a dividend-history rule. Its prospectus says constituents "must have a Morningstar Economic Moat rating of 'narrow' or 'wide' and have a Morningstar Distance to Default score in the top 50% of eligible dividend-paying companies within their sector." Companies with no moat rating need a Distance to Default score in the top 30%. Each dividend "must be deemed to be qualified income," which keeps REITs out. The index then takes "the top 75 high-yielding stocks."
The weighting is the bigger difference. Morningstar weights HDV's index "in proportion to the value of each stock's trailing 12-month dividend payments." A company that pays out a large total dollar amount of dividends gets a large weight. The provider's cap is loose by comparison with SCHD's: "Stocks representing more than 5% of the index cannot collectively exceed 50% of total index weight," and sectors are capped at the lower of 40% or five times their weight in the parent index. That is why Exxon Mobil could be 7.26% of HDV on 30 June 2026, while SCHD's rules reset every holding to 4% or less at each quarterly rebalance.
Reconstitution timing differs too. HDV's statement of additional information says its index "is reconstituted four times annually," in March, June, September and December. SCHD's index is reviewed once a year and rebalanced quarterly. HDV's reported turnover in the latest fiscal year was 65%, against SCHD's 30%.
Where the Portfolios Differ
| Sector, 30 June 2026 | HDV | SCHD | Difference |
|---|---|---|---|
| Consumer Staples | 24.29% | 20.38% | +3.91 |
| Health Care | 23.80% | 20.72% | +3.08 |
| Energy | 19.58% | 14.07% | +5.51 |
| Consumer Discretionary | 9.25% | 7.74% | +1.51 |
| Utilities | 8.31% | 0.11% | +8.20 |
| Communication | 5.23% | 6.15% | -0.92 |
| Financials | 4.68% | 10.05% | -5.37 |
| Industrials | 3.73% | 11.55% | -7.82 |
| Information Technology | none listed | 9.23% | -9.23 |
| Materials | 0.80% | none listed | +0.80 |
HDV is the more defensive mix: more energy, more utilities, no technology on its June fact sheet. On iShares' live page on 1 October 2026, energy had risen to 24.73% and technology appeared at 0.56%. SCHD's technology sleeve (Qualcomm, Texas Instruments, Accenture) and its larger industrials and financials weights are the main reasons it is less concentrated in the old-economy income sectors.
HDV is also more top-heavy. Its ten largest positions were 50.98% of the fund on 30 June 2026: Exxon 7.26%, AbbVie 6.48%, Chevron 5.41%, Verizon 5.23%, Home Depot 4.96%, Procter & Gamble 4.81%, Philip Morris 4.42%, Pfizer 4.31%, Merck 4.12% and Coca-Cola 3.98%. SCHD's ten largest were 41.62% on 2 October 2026, led by Texas Instruments at 4.90%. With 75 stocks and half the fund in ten names, one bad year for oil or for big pharma shows up quickly in HDV.
Returns and Tax Drag
Both issuers publish standardized returns to 30 June 2026, so this table is date-matched.
| Average annual return at NAV, to 30 June 2026 | 1 year | 3 years | 5 years | 10 years |
|---|---|---|---|---|
| HDV | 20.67% | 14.65% | 11.11% | 9.11% |
| SCHD | 24.08% | 13.52% | 8.51% | 12.37% |
| HDV minus SCHD | -3.41 | +1.13 | +2.60 | -3.26 |
| HDV after taxes on distributions | 19.78% | 13.72% | 10.18% | 8.18% |
| SCHD after taxes on distributions | 22.68% | 12.42% | 7.54% | 11.45% |
| Tax drag, HDV / SCHD | 0.89 / 1.40 | 0.93 / 1.10 | 0.93 / 0.97 | 0.93 / 0.92 |
Neither fund wins outright. SCHD's ten-year lead is large: $10,000 compounding at 12.37% a year grows to about $32,100, against about $23,914 at HDV's 9.11%. Over five years the order reverses: about $16,934 for HDV against $15,043 for SCHD. Which window you look at decides the answer, so treat any claim that one fund is "the better dividend ETF" with care.
The tax drag is close. Both funds lost roughly 0.9 points a year to tax on distributions over ten years. That is what you would expect from two funds yielding about 3.3%. In an IRA or 401(k) neither figure applies.
The dollar figures are hypothetical arithmetic by Wealthy Pot on a single $10,000 lump sum at each fund's published annualized NAV return, with no contributions, costs or taxes. They are backward-looking, not a forecast. This is educational information, not personalized investment advice.
Which One Fits You
SCHD is the default for most dividend investors. It is cheaper, holds 100 stocks with a 4% cap per name, includes some technology and industrials, and has the stronger ten-year record. It is also about seven times larger by net assets, which does not change your return.
HDV fits if you want the most defensive income mix. It is heavier in energy, staples, health care and utilities, and its three-year standard deviation was 11.40% on 31 August 2026, against 13.46% for SCHD on the same date. Monthly distributions may also suit someone paying bills from the income. Accept more concentration in exchange: Exxon alone was over 7% of the fund.
In a taxable account, the two are roughly equal on tax drag. Either one throws off about $3,300 a year of taxable distributions per $100,000 at current yields (our arithmetic, assuming the yields hold). If you want a lower tax bill from your equity holdings, a broad index fund such as VTI or the S&P 500 (see SCHD vs SPY) is the lever, not switching between these two.
Holding both gives you about 100 more stocks than holding either one, but 47.3% of the money overlaps. If you do it, think of HDV as an energy and utilities tilt on top of SCHD. If you already own VYM as well, check all three in the overlap checker before adding anything.
Sources & Methodology
- HDV summary prospectus (Form 497K) dated 31 August 2026: 0.08% fee, $10,000 cost example, 65% turnover, index description and screens, representative sampling, non-diversified status, returns to 31 December 2025.
- iShares Trust Form 485BPOS filed 21 August 2026: the statement of additional information on the index's quarterly reconstitution.
- iShares HDV fund page and fact sheet as of 30 June 2026: net assets, holdings, SEC yield, distribution history, sectors, top ten, standard deviation and returns.
- Morningstar Dividend Yield Focus Indexes overview and the September 2025 reconstitution report: dividend-dollar weighting, the 5%/50% and sector caps, and the 75-stock count.
- Schwab Strategic Trust Form 485BPOS filed 22 December 2025: SCHD's 0.06% fee, cost example, 30% turnover and index rules.
- Schwab SCHD fund page, read 5 October 2026: SEC yield, holdings, net assets, top ten, sectors, standard deviation and the before- and after-tax returns.
- Form N-PORT filings for HDV (31 July 2026) and SCHD (31 May 2026): the overlap, computed as the sum of the smaller weight of every shared holding.
Limits. The overlap uses filings two months apart. The two SEC yields are a month apart because each issuer last published on a different date. Morningstar's family-wide overview describes semi-annual rebalancing for its Dividend Yield Focus indexes, while HDV's statement of additional information and Morningstar's own report for this US index both say quarterly; we follow the fund's filing. We did not establish why SCHD's screen excludes Exxon Mobil or AbbVie, so this page does not say.
This article is for general education and is not investment, tax or legal advice. Fund data changes daily, index returns cannot be invested in directly, and past performance does not guarantee future results. All investing carries the risk of loss. Figures were checked against the sources above on 5 October 2026.
FAQ: HDV vs SCHD
Is HDV or SCHD better?
Neither on every measure. To 30 June 2026 SCHD returned more over one and ten years, HDV over three and five. SCHD is cheaper (0.06% vs 0.08%) and less concentrated. HDV is more defensive and now pays monthly.
How much do HDV and SCHD overlap?
47.3% by the sum of the smaller weight in each shared stock, with 28 stocks in common. About 54% of each fund's weight is in stocks the other owns. That is our calculation from N-PORT filings for 31 July 2026 (HDV) and 31 May 2026 (SCHD).
Which pays the higher dividend?
They are close. HDV's 30-day SEC yield was 3.34% on 31 August 2026 and SCHD's was 3.37% on 1 October 2026.
Does HDV pay monthly?
iShares lists HDV's distribution frequency as monthly, and it paid in July, August and September 2026. Before that it paid quarterly. SCHD pays quarterly.
Why is HDV so heavy in Exxon Mobil?
Its index weights stocks by the total dollar value of dividends paid over the past twelve months, and the provider only limits the combined weight of stocks above 5% to 50% of the index. Exxon pays a very large total dividend, so it gets a large weight: 7.26% on 30 June 2026. SCHD caps each stock at 4% at every rebalance.
Should I hold both HDV and SCHD?
You can, but nearly half the money overlaps. Holding both mainly adds energy, utilities, AbbVie, Pfizer and Philip Morris to SCHD. Decide whether you want that tilt before buying a second fund.
Cite This Page
Journalists, educators and bloggers are welcome to cite this comparison. Please link back so readers can reach the underlying filings.
"HDV vs SCHD: Two Quality-Screened Dividend Funds That Share Half Their Portfolio." Wealthy Pot, 2026. https://wealthypot.com/hdv-vs-schd/
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