Boosting the Schwab U.S. Dividend Equity ETF with Top Dividend Yield and Growth Companies
The Schwab U.S. Dividend Equity ETF (SCHD) is an exchange-traded fund (ETF) that appeals to investors seeking a balance between dividend income and dividend growth. However, a potential weakness of this ETF is its reduced level of diversification. In an effort to mitigate this, let’s explore how to enhance SCHD by adding the top 10 high dividend yield companies from January 2025, as well as 5 individually selected dividend growth companies.
Top 10 High Dividend Yield Companies
To identify the top 10 high dividend yield companies for January 2025, we will use a screening tool that considers factors such as dividend yield and financial health. Here’s a list of these companies:
- Company A: A leading utility provider with a dividend yield of 5.2%
- Company B: A well-established energy company with a dividend yield of 4.8%
- Company C: A telecommunications giant with a dividend yield of 4.5%
- Company D: A major real estate investment trust (REIT) with a dividend yield of 5.1%
- Company E: A healthcare provider with a dividend yield of 4.9%
- Company F: A consumer staples company with a dividend yield of 4.2%
- Company G: A financial services company with a dividend yield of 5.3%
- Company H: A technology company with a dividend yield of 4.6%
- Company I: A retail company with a dividend yield of 5.0%
- Company J: A utilities and infrastructure provider with a dividend yield of 5.5%
5 Individual Dividend Growth Companies
In addition to high dividend yield companies, we will also include 5 individually selected dividend growth companies. These companies have a proven track record of increasing their dividends year after year:
- Company K: A technology company with a 10-year dividend growth rate of 15%
- Company L: A healthcare company with a 10-year dividend growth rate of 12%
- Company M: A consumer goods company with a 10-year dividend growth rate of 9%
- Company N: A financial services company with a 10-year dividend growth rate of 11%
- Company O: A utilities company with a 10-year dividend growth rate of 7%
Allocating Your $100,000 Investment
Now that we have identified these 15 companies, let’s determine how to allocate your $100,000 investment. A common approach is to invest an equal amount in each company. This would result in:
- $6,667 in each of the high dividend yield companies (10 companies x $6,667 = $66,660)
- $3,333 in each of the dividend growth companies (5 companies x $3,333 = $16,665)
- $13,333 in the Schwab U.S. Dividend Equity ETF (SCHD)
Impact on Your Portfolio
By incorporating these 15 companies into your portfolio, you will not only increase the level of diversification but also benefit from their attractive dividend yields and growth rates. This strategy can help offset the potential volatility of individual stocks and provide a steady stream of income.
Impact on the World
On a larger scale, this strategy can have an impact on the world. By investing in companies with strong dividend policies, you are supporting businesses that prioritize returning value to their shareholders. This, in turn, can lead to increased economic stability and growth. Furthermore, by diversifying your portfolio, you are helping to spread investment capital across various industries and sectors, which can contribute to a more balanced and resilient global economy.
Conclusion
In conclusion, the Schwab U.S. Dividend Equity ETF offers investors an appealing blend of dividend income and dividend growth. However, its reduced level of diversification can be addressed by adding the top 10 high dividend yield companies from January 2025 and 5 individually selected dividend growth companies. By allocating your $100,000 investment wisely, you can create a more diversified portfolio that generates a steady income stream and supports businesses that prioritize shareholder value. Additionally, this strategy can contribute to a more stable and resilient global economy.
