How Does SCHD Fare Vs. The SPY And Other Yield Plays? (Archive)

This 5-Minute Pitch was originally published on Seeking Alpha before the launch of the Hunting Alphas website. It is shared here to showcase my previous work and track record. New 5-Minute Pitches published on this site will not be disseminated anywhere else.

Elevator Pitch

• SCHD has large net overweights to the Energy (especially upstream O&G), Industrials, and Consumer Staples sectors vs the S&P500.
• SCHD's industrials overweight may not be favorable given contracting US Manufacturing PMI data.
• I don't like how SCHD has zero exposure to some of the SPY's Top 10 Magnificent 7 stocks I am bullish on; NVIDIA, Microsoft, and Amazon.
• SCHD's valuations are low and undemanding, and hence are a source of upside risk. But to contest this point, technical analysis of SCHD vs. SPX500 says the underperformance downtrend remains.
• So overall, I prefer the S&P500 over SCHD. And for yield-focused investors, I think there are higher-yielding alternatives such as Enbridge, Petrobras, and British American Tobacco; all of these beat SCHD's 3.87% dividend yield.

Read the full article here.