The Schwab US Dividend Equity ETF (SCHD) is in a recovery mode as the US stock market rebounds. SCHD was trading at $27.45 on Thursday, its highest level since July 10 and lower than last year’s high of $28.90.
This article explains why the REX-Osprey SOL + Staking ETF (SSK) is a better complement to the SCHD ETF.
SCHD ETF is a top dividend ETF
The Schwab US Dividend Equity is a popular fund among dividend investors due to its track record of dividend growth and strong performance. Its total return in the last five years was 71%, a strong performance for a fund that has little exposure to the technology sector.
The fund has a dividend yield of 3.83%, making it a better investment than government bonds. While US government bonds yield over 4%, they don’t provide any growh
The SCHD ETF is made of blue-chip companies that have a track record of generating strong dividends. Most of its constituent companies are in the consumer defensive industry, followed by energy, health care, technology, and consumer cyclical.
The top holdings in the fund include companies such as Chevron, Altria, PepsiCo, Cisco, ConocoPhillips, and Home Depot. Instead, the SCHD ETF has had a compounded annual growth rate of 10% in the last decade.
Here’s why the SSK ETF is better than SCHD
There are reasons to believe that the SSK ETF is a better dividend ETF than SCHD. SSK is a recently approved fund that aims to achieve two things: give investors exposure to Solana and provide regular income through regular dividend.
The SSK ETF derives its dividend from the staking income that Solana provides. Data shows that Solana has a staking yield of 7.50%, meaning that a $10,000 investment will make $750 annually from staking. In contrast, a similar amount will provide $380, giving it an advantage of $350.
The real benefit in terms of returns is smaller than $350 because SSK ETF has a higher expense ratio of 1.4% compared to SCHD’s 0.06%.
Solana price technical analysis points to more gains
The other benefit for buying SSK outright or as a complement to the SCHD ETF is that Solana price has strong technicals. The daily chart shows that the SOL price has been in a strong bull run in the past few days, moving from a low of $156 on July 28 to $207 today.
SOL price has moved above the 50% Fibonacci Retracement level. It is also attempting to invalidate the risky double-top pattern by moving above the resistance at $205. A double-top is one of the riskiest chart patterns in technical analysis.
The token has also formed the highly bullish golden cross pattern as the 50-day and 200-day moving averages crossed each other. Therefore, with a crypto bull run being underway, it is likely that the SOL price will continue rising.
SOL price has catalysts ahead
Additionally, Solana price, and the SSK ETF have several catalysts ahead. For example, there are rising odds that the SEC will approve some or all spot Solana ETFs that companies like Bitwise and Franklin Templeton have filed.
If approved, these ETFs will likely draw billions of dollars, boosting the SOL price as they did with Ethereum and Bitcoin, which have jumped to their all-time high.
Solana’s transactions are surging and its role in the crypto industry growing. For example, it is one of the biggest players in the stablecoin, decentralized exchange, and decentralized finance industries.
Summary
The SCHD ETF has been a solid fund in the past 12 years, and this trend will likely continue. However, its 3.5% dividend yield is not enough, which explains why many investors question its position as a dividend ETF.
The SSK ETF gives an exposure to the second-biggest chain in crypto at a tim when a bull run is happening.
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