With over $85 billion in net assets and a 3.3% yield, the Schwab U.S. Dividend Equity ETF (SCHD 0.59%) is one of the most popular high-yield dividend exchange-traded funds (ETFs). It’s up 10.8% year to date, compared to a 5% decline in the S&P 500 (^GSPC 1.67%).
The ETF’s exposure to the scorching hot energy sector is contributing to its outperformance. But energy stocks have run up so much that they now make up 23.9% of the ETF.
Here’s why that concentration can be a red flag for risk-averse investors who prefer more diversification, and whether the ETF is still a good buy now.
Image source: Getty Images.
This ETF benefits from higher oil prices
The ETF has 101 holdings, 12 of which are energy stocks.
Company
Weighting (as of 3/20/2026)
ConocoPhillips (COP +0.41%)
5%
Chevron (CVX +1.70%)
4.8%
EOG Resources (EOG +1.47%)
2.8%
Valero Energy (VLO +2.62%)
2.8%
SLB (SLB…
