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Another Dividend ETF Debuts: Schwab’s SCHD
October 20, 2011 at 09:59 AM EDT
Charles Schwab added another ETF to its lineup on Wednesday, launching a fund that focuses on dividend-paying U.S. stocks. The new Schwab U.S. Dividend ETF (SCHD) will seek to replicate the Dow Jones U.S. Dividend 100 Index, a modified cap-weighted benchmark that includes 100 dividend-paying equities. In order to be eligible for inclusion in the underlying index, stocks must have at least ten consecutive years of dividend payments. The universe of stocks that meet that criteria are evaluated on four characteristics that are used to determine which are included in the index: Cash flow to total debt Return on equity Dividend yield 5-year dividend growth rate Stocks with this highest scores on those four criteria are selected for inclusion in the index, which affords a maximum weight of 4.5% to any one stock and a sector cap at 25%. REITs, master limited partnerships, preferred stock, and convertibles are excluded from [...] Click here to read the original article on ETFdb.com. Related Posts: No Related Posts
Charles Schwab added another ETF to its lineup on Wednesday, launching a fund that focuses on dividend-paying U.S. stocks. The new Schwab U.S. Dividend ETF (SCHD) will seek to replicate the Dow Jones U.S. Dividend 100 Index, a modified cap-weighted benchmark that includes 100 dividend-paying equities. In order to be eligible for inclusion in the underlying index, stocks must have at least ten consecutive years of dividend payments. The universe of stocks that meet that criteria are evaluated on four characteristics that are used to determine which are included in the index: Cash flow to total debt Return on equity Dividend yield 5-year dividend growth rate Stocks with this highest scores on those four criteria are selected for inclusion in the index, which affords a maximum weight of 4.5% to any one stock and a sector cap at 25%. REITs, master limited partnerships, preferred stock, and convertibles are excluded from [...]
