VTI vs SCHD: Side-by-Side ETF Comparison
Should you choose broad market exposure with VTI or reliable dividend income with SCHD? This comprehensive VTI vs SCHD breakdown covers performance, fees, volatility, and portfolio composition to help you make the right call.
Which one is better? VTI offers total market exposure with stronger growth potential across all market caps, while SCHD focuses on high-quality, dividend-paying U.S. stocks. Choose SCHD for income and stability, or VTI for broad diversification and long-term capital appreciation.
Table of Content
ETF Issuers & Investment Objective
- VTI: Introduced by Vanguard in 2001, the Vanguard Total Stock Market ETF (VTI) is designed to capture the entire investable U.S. equity market. It tracks a broad index that includes large-, mid-, small-, and micro-cap stocks, offering investors comprehensive diversification across all sectors and company sizes in a single low-cost fund.
- SCHD: Launched by Charles Schwab in 2011, the Schwab U.S. Dividend Equity ETF (SCHD) aims to track the performance of high dividend-yielding U.S. stocks with a proven history of consistent payouts. The fund selects companies based on fundamental strength, focusing on quality and sustainability of dividends making it a go-to option for income-focused investors seeking stability and value.
Annual & Cumulative Returns
| Period | SCHD | VTI | Difference |
|---|---|---|---|
| YTD (2025) | −1.99% | +2.82% | +4.81% |
| 1-Year | +5.90% | +14.06% | +8.16% |
| 3-Year Returns | +4.41% | +16.73% | +12.32% |
| 5-Year Returns | +11.24% | +14.66% | +3.42% |
| 10-Year Returns | +10.91% | +12.40% | +1.49% |
VTI has consistently outperformed SCHD across all key timeframes, highlighting the power of total market exposure. Its inclusion of fast-growing sectors especially technology has driven stronger returns, particularly during bull markets. Meanwhile, SCHD’s focus on dividend stalwarts delivers more predictable, income-driven gains, but it tends to lag in high-growth environments.
Risk Metrics
| Metric | SCHD | VTI |
| 1-Year Volatility | 13.95% | 12.80% |
| 3-Year Volatility | 16.01% | 17.10% |
| 3-Year Sharpe Ratio | 0.02 | 0.57 |
Although both ETFs carry comparable volatility over three years, VTI has generated significantly higher returns for each unit of risk taken. This superior Sharpe ratio underscores the efficiency of VTI’s growth-driven strategy. SCHD’s more defensive profile introduces occasional underperformance, especially in markets where cyclical sectors are more volatile.
- Volatility reflects the degree of price fluctuations; higher volatility often correlates with greater risk and potential returns.
- Sharpe Ratio measures risk-adjusted returns, where higher ratios indicate more favorable returns for the risk assumed.
Dividend Yield & Growth
| Metric | SCHD | VTI |
| Dividend Yield | ~4.27% | ~1.52% |
| Frequency | NA | Quarterly |
The income appeal of SCHD is clear it delivers a much higher yield than VTI, making it ideal for investors prioritizing cash flow. Its selection process favors companies with strong dividend histories, which boosts its payout. On the other hand, VTI’s lower yield reflects its emphasis on reinvestment and growth, not income distribution.
Fees & Liquidity
| Metric | SCHD | VTI |
| Expense Ratio | 0.06% | 0.03% |
| Avg Bid-Ask Spread | N/A | N/A |
| Avg Daily Volume (Est) | N/A | N/A |
Both ETFs offer ultra-low costs, but VTI sets the industry standard with a rock-bottom 0.03% expense ratio. While SCHD remains attractively priced, cost-conscious investors might still prefer VTI for its unmatched efficiency. That said, the difference is negligible for most buy-and-hold investors focused on long-term returns.
Explanation:
- Expense Ratio is the annual fee taken by the fund manager, expressed as a % of your investment.
- Bid-Ask Spread is the difference between the buying and selling price. Smaller spreads mean lower transaction costs.
ETF Composition: Asset Classes
| Asset Class | SCHD (%) | VTI (%) |
| US Stocks | 99.27 | 98.89 |
| Non-US Stocks | 0.63 | 0.56 |
| Cash | 0.10 | 0.55 |
| Bonds/Other | 0.00 | 0.00 |
Though both funds are nearly fully invested in equities, VTI’s broader diversification includes companies across the full market-cap spectrum from small startups to large tech giants. SCHD, by contrast, takes a more focused approach, filtering for U.S. dividend payers only. This makes VTI better suited for those seeking comprehensive market representation.
Regional Allocation
| Region | SCHD (%) | VTI (%) |
| North America | 99.37 | 99.57 |
| Europe Developed | 0.00 | 0.30 |
| United Kingdom | 0.55 | 0.03 |
| Other | 0.08 | 0.20 |
SCHD stays almost entirely within U.S. borders, aligning with its dividend mandate that excludes international stocks. VTI, while also U.S.-centric, includes a minor slice of non-U.S. exposure through ADRs and globally active firms. For investors strictly targeting U.S. equity exposure, both deliver but SCHD is even more purist.
Sector Weights
| Sector | SCHD (%) | VTI (%) |
| Technology | 11.07 | 30.13 |
| Financial Services | 8.76 | 14.33 |
| Consumer Cyclical | 9.79 | 10.36 |
| Healthcare | 14.57 | 11.15 |
| Communication Services | 4.86 | 8.74 |
| Industrials | 11.06 | 8.86 |
| Consumer Defensive | 19.35 | 5.82 |
| Others (Energy, Real Estate, etc.) | 20.54 | 10.61 |
VTI and SCHD represent very different sector philosophies. VTI skews toward fast-growth areas like tech and communication services, resulting in a growth-heavy tilt. In contrast, SCHD concentrates capital in traditionally defensive and dividend-rich sectors like consumer staples and energy, offering more stability but potentially less upside.
Top 10 Holdings
| Rank | SCHD Company | SCHD (%) | VTI Company | VTI (%) |
|---|---|---|---|---|
| 1 | The Coca-Cola Company | 4.29 | Apple Inc | 5.94 |
| 2 | Verizon Communications Inc | 4.28 | Microsoft Corporation | 5.47 |
| 3 | Cisco Systems Inc | 4.28 | NVIDIA Corporation | 4.70 |
| 4 | Lockheed Martin Corporation | 4.23 | Amazon.com Inc | 3.27 |
| 5 | Altria Group | 4.22 | Meta Platforms Inc. | 2.24 |
| 6 | Texas Instruments Incorporated | 4.13 | Berkshire Hathaway Inc | 1.76 |
| 7 | ConocoPhillips | 4.07 | Alphabet Inc Class A | 1.71 |
| 8 | Home Depot Inc | 4.05 | Broadcom Inc | 1.68 |
| 9 | Chevron Corp | 3.85 | Tesla Inc | 1.44 |
| 10 | Amgen Inc | 3.84 | Eli Lilly and Company | 1.43 |
The contrast in holdings speaks volumes: SCHD is built around dividend reliability, featuring legacy names with steady cash flow and less price volatility. VTI’s top holdings reflect the modern growth engine of the market dominant players in innovation, cloud, AI, and e-commerce. Each fund mirrors its core philosophy through these positions.
Valuation & Growth Metrics
Valuation Ratios
| Metric | SCHD | VTI |
| P/E Ratio (Forward) | 13.73 | 20.40 |
| Price/Book | 2.83 | 3.66 |
| Price/Sales | 1.43 | 2.42 |
| Price/Cash Flow | 8.77 | 13.15 |
| Dividend Yield | 4.27% | 1.52% |
Looking at valuations, SCHD appears more attractively priced by most traditional metrics. Lower earnings and sales multiples suggest value-focused holdings, often found in mature industries. VTI trades at higher multiples, justified by the stronger growth expectations of its tech-heavy portfolio but also indicating more pricing risk during downturns.
Explanation:
- P/E Ratio = Price divided by earnings. Indicates how expensive a fund is relative to profits.
- Price/Book = Price vs book value (assets minus liabilities).
- Price/Sales = Price relative to total revenue.
- Price/Cash Flow = Price relative to how much cash the companies generate.
Growth Expectations
| Metric | SCHD | VTI |
| Long-Term Earnings Growth | 6.43% | 10.01% |
| Historical Earnings Growth | −1.70% | 7.93% |
| Sales Growth | 4.30% | 6.92% |
| Cash Flow Growth | −2.40% | 6.26% |
| Book Value Growth | 6.36% | 7.10% |
If growth is the goal, VTI is the clear leader. Its portfolio companies consistently post higher rates of earnings, sales, and cash flow growth. SCHD’s holdings, while financially solid, typically operate in slower-growth sectors favoring income reliability over aggressive expansion.
Which ETF Fits Your Portfolio - VTI vs SCHD?
The choice between SCHD and VTI ultimately depends on your investment goals and risk appetite. If you're seeking steady income through reliable dividend payouts and prefer a portfolio anchored in mature, fundamentally strong U.S. companies, SCHD offers a compelling value. It’s particularly well-suited for income-oriented investors, retirees, or those looking to buffer volatility with consistent cash flow.
On the other hand, if you want comprehensive exposure to the entire U.S. stock market including large-, mid-, small-, and micro-cap stocks VTI provides unmatched diversification and long-term growth potential. Its heavy allocation to tech and innovation-driven sectors has historically translated to stronger capital appreciation, albeit with a lower yield.
In short, SCHD fits a dividend-focused, conservative strategy, while VTI aligns with growth-focused, long-term investing. Many investors even choose to hold both to balance income and growth within a well-rounded portfolio.