The Smartest Dividend ETF to Buy With $1,000 Right Now -- and It's Up 19% in 2026
Written by Selena Maranjian for The Motley Fool -> This ETF's dividend yield was recently a solid 3.25%, about three times that of the S&P 500. Its growth rate has been better than that of many dividend-focused funds. It seems poised to hold up better than some other funds in
This ETF's dividend yield was recently a solid 3.25%, about three times that of the S&P 500.
Its growth rate has been better than that of many dividend-focused funds.
It seems poised to hold up better than some other funds in a market downturn.
As I do now and then, I'm here to recommend an exchange-traded fund (ETF) for your consideration. (Remember that ETFs are funds that trade like stocks.) Specifically, one that's focused on dividend-paying stocks. There are many such ETFs to choose from, but it's hard for me to recommend any other one than the Schwab U.S. Dividend Equity ETF (NYSEMKT: SCHD) .
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With dividend-focused ETFs , there's generally a trade-off between dividend income and growth. The highest-yielding ETFs tend to grow more slowly, and vice versa. The Schwab U.S. Dividend Equity ETF, though, is strong on both counts.
Its dividend yield is 3.25% (as of June 3); a look at its recent performance follows. I'm including the performance of the Vanguard S&P 500 ETF (NYSEMKT: VOO) , which recently yielded merely 1.1%, too, for comparison.
You can see that the Schwab fund, up 19% year to date, delivers less growth than the S&P 500 , but not that much less, especially when compared with many other dividend-focused ETFs. Also, it kicks out almost three times the dividend income as the S&P 500.
