FDVV vs SCHD: Which Dividend ETF Is Better for Long-Term Investors?

If you’re building a dividend portfolio, you’ve probably heard of SCHD—the Schwab U.S. Dividend Equity ETF. But what about FDVV, the Fidelity High Dividend ETF?

While SCHD has earned its reputation for reliability and growth, FDVV offers a higher yield today and flies under the radar. In this post, we’ll compare FDVV vs SCHD, focusing on dividend growth, total return, and potential risks you need to be aware of.

Let’s find out which dividend ETF deserves a spot in your portfolio.

What Is FDVV?

FDVV (Fidelity High Dividend ETF) is designed to track large-cap U.S. companies with higher-than-average dividend yields. It typically holds around 100–150 stocks across sectors like utilities, energy, and financials—tilting toward value.

• • Dividend Yield: ~4.0%

• • Expense Ratio: 0.29%

• • Top Holdings: ExxonMobil, JPMorgan, AbbVie, Chevron

• • Focus: Current income with less emphasis on dividend growth

FDVV is attractive to investors seeking a higher starting yield, but it lacks the deep quality filters found in other ETFs.

What Is SCHD?

SCHD (Schwab U.S. Dividend Equity ETF) is one of the most popular dividend ETFs for a reason. It tracks the Dow Jones U.S. Dividend 100 Index, which includes only high-quality companies with consistent dividend payouts and strong financials.

• • Dividend Yield: ~3.5%

• • Expense Ratio: 0.06%

• • Top Holdings: Broadcom, Coca-Cola, Texas Instruments, PepsiCo

• • Focus: Dividend growth, return on equity, and earnings consistency

SCHD shines for investors looking to grow their income over time, not just collect dividends today.

Dividend Growth: SCHD Wins on Consistency

When comparing dividend growth, SCHD has the clear edge.

• • SCHD has grown its dividend at a compound rate of ~12% per year over the past decade.

• • FDVV offers a higher yield, but its dividend growth rate is slower and less consistent—closer to 5–6% annually with some years of flat or declining payouts.

If you’re planning to live off dividends in the future, dividend growth is crucial. SCHD offers a steadily rising income stream, while FDVV is more focused on upfront yield.

Capital Appreciation: SCHD Outperforms

Over the past 5 years, SCHD has also delivered stronger total returns:

• • SCHD: ~55–60% total return

• • FDVV: ~40–45% total return

Why the gap?

SCHD includes more companies with higher earnings growth and better balance sheets. FDVV, while offering a higher yield, includes more traditional value names that may be yield traps—stocks with high payouts but weaker fundamentals.

If you want both income and long-term growth, SCHD tends to be the more balanced option.

Hidden Risks of FDVV

FDVV may look attractive at first glance, but there are a few red flags to consider:

1. Dividend Volatility

FDVV’s payouts are less stable than SCHD’s. Investors have seen fluctuations from year to year, which can make income planning harder.

2. Less Rigorous Screening

FDVV focuses primarily on high-yield stocks. Unlike SCHD, it doesn’t filter based on quality metrics like return on equity or dividend growth history. This can lead to exposure to lower-quality businesses.

3. Lower Liquidity

FDVV isn’t as well-known or widely traded. That means potentially higher bid-ask spreads and fewer resources tracking its performance.

These don’t necessarily make FDVV a bad ETF—but it’s important to understand the trade-offs when comparing it to SCHD.

FDVV vs SCHD: Which ETF Should You Choose?

Here’s the breakdown:

FDVV may be worth it if you want higher yield now and can tolerate some payout variability.

SCHD is the better choice for long-term investors who want dividend reliability, steady growth, and capital appreciation.

Plan Your Income with the Best Dividend Calculator

Whether you invest in FDVV, SCHD, or a combination of both, it’s essential to track your income goals and estimate your future payouts.

That’s why we built the Best Dividend Calculator — a free tool to:

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Final Thoughts

In the FDVV vs SCHD debate, both ETFs have their place. If you’re still building your portfolio, blending yield with growth might be the smartest move. Just make sure your strategy matches your timeline and risk tolerance.

Got questions about dividend ETFs or want a deeper breakdown? Drop a comment below or subscribe to Your Favorite Investor on YouTube for weekly dividend investing insights!