Move Over Energy Stocks. This Uber-Popular Dividend ETF Has a New Favored Income Source.
2026-04-01 14:50:00 ET
The Schwab U.S. Dividend Equity ETF (NYSEMKT: SCHD) , a popular dividend-focused ETF (it's one of my favorites), recently completed its annual reconstitution. The index the ETF tracks updates its holdings once a year, deleting high-yielding dividend stocks that no longer pass its dividend quality screens and replacing them with companies that do. This year, the fund cut 22 existing stocks and replaced them with 25 new ones.
One outcome of these changes was that the fund significantly reduced its exposure to energy stocks , resulting in consumer staples stocks now having the highest weighting in the fund. Here's why this sector has become its new favored income source.
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