SCHD is Splitting. What That Means For Investors

On September 25th, Schwab Asset Management made a major announcement regarding 20 of their ETFs. According to a press release on their website, “Schwab Asset Management, the asset management arm of The Charles Schwab Corporation, today announced forward share splits on 20 Schwab ETFs. Forward ETF share splits increase the number of shares outstanding and decrease the Net Asset Value (NAV) per share. The share splits will not change the total value of a shareholder’s investment. The ETF share splits will apply to shareholders of record as of the close of US markets on October 9, 2024, payable after the close of the markets on October 10, 2024.

Shares will begin trading at their post-split price on October 11, 2024.” And you can see here that SCHD is one of those ETFs that’s going to go through this split. It says the fund will be performing a 3 for 1 stock split, with a record date of October 9th and a pay date of October 10th. There’s been a lot of discussion regarding this and people have been asking me what kind of effect this will have on SCHD. So we’ll take a look at what effect this will have on SCHD and what shareholders should keep in mind about the split.

[KarenLavia]

Dividends from SCHD are typically taxed at the qualified dividend rate, which may be lower than ordinary income tax rates for many investors. However, the main focus for markets now is Nvidia, which has powered a large chunk of the S&P 500’s recent earnings. Nvidia’s stock, up more than 90% this year, rose 2.5% in New York on Monday, sending the Nasdaq 100 index to another record high. I'm still looking for companies to make additions to my $350K portfolio, to boost performance. Here for ideas...

[oneillbilder]

If I had $360k I would invest $100k in tech & $260k into dividend stock with a proven track record to grow with capital appreciation & dividend increase year over year

[Andreavince-v]

I came across your channel through this video—case studies are incredibly valuable, and I'm eager to see more in the future! Building wealth involves establishing routines, like consistently setting aside funds at regular intervals for smart investments.

[Lamarche]

If you invest $2, 545 into the S&P, then assuming a 10% annual rate of return, your child at an early retirement age will be 2 Million plus rich, excluding every other income channeled to this. We need to invest much more. Focus on the company not just the stock price, true words from my F.A Dianne Sarah Olson ..I made over half a million from ALB and NVDA..I love passive income.

[SkepticalMechanic-lx]

My strategy combines ETFs for dividends and growth, including JEPI, DIVO, QYLD, SCHD, and JEPQ. Last year, my dividends totaled $102K. but not sure how to mitigate risk thus far for this year.

[annaj.osorio]

I'm an amateur with a portfolio of 180k and I've got some real estate holdings too, but it's hard for me to build confidence. I want to invest another 70k over a one month span, but I want to be strategic about doing it so I can grow more and not stay stagnant. Is this a good dividend stock suggestion?

[MarcusBampoe]

Im gonna buy my first shares of SCHD today at market open. Definitely want to get in before the split. Good video!

[HodgeChris]

Started my portfolio last year with SCHD, VOO, and VUG after watching one of your videos. In terms of share price, VOO is way up (22.25%) and VUG is up (39.62%). Thanks for the education!

[beautifulpeopleonearth]

I started my 200k portfolio 2022 with SCHD, VOO, and VUG after watching one of your videos. In terms of share price, VOO is up! and VUG is doing even better. This year, I've tried to add some more assets but unfortunately facing a decline.

[DonaldConrad]

I have had SCHD in my portfolio for a while now. And it is set up in a DRIP, so I have partial shares. When the 3:1 split happened, Schwab multiplied everything to the left of the decimal point by three, but didn't include anything to the right of the calculation. For me, that amount to the right of the decimal point was 0.35, and because it was left out of the calculation I am now 2/3 of a share shy of the value I had before the split. Doesn't sound like much, but imagine how many investors have partial shares... I'd say Schwab made out pretty good in that split, especially considering they split several of their ETFs. I contacted my broker, but haven't heard back yet.

[jloop_]

Just breached 170k in SCHD. The snowball is starting to roll.

[Skreach]

I think stock splits have become less common due to more brokerage companies doing fractional shares now

[drescherjm]

I don't expect much to happen after the split. In either case I should have close to a thousand shares of SCHD after the split instead of over 300. I think this is my first forward split. I had a 1 for 6 split in the past.

[lonewanderer]

It seems they are trying to get most of these stocks down around $20-25. Schwab does not allow purchasing fractional shares, so I think this is a good thing.

[tritosac]

It is definitely important for newer investors to understand the implications of a reverse split vs. a forward split. I have been burned on penny stocks or OTC stocks that perform reverse splits just to adhere to listing guidelines. I learned my lesson long ago. I won't touch anything that has a history of reverse splits. Forward splits, however, bode success for a company/ETF. Forward splits can actually result in the price moving up a little bit post-split.

[Draylis]

Love Now I can make 3 times as many Covered calls! Boom! Wish DGRO and JEPQ would do the same.

[NightHawk-wjmz]

I only own 18 shares at the moment and this split is definitely making me want to buy more for the exact reason you said. $82 for 1 share was not enticing to me and I went elsewhere but now after a 3 slit I'll be buying it more often

[buyDFL]

Bought back into $SCHD earlier this year & I've accumulated just under 16 shares so far. Going to wait until the split next week, before buying another chunk of shares!

[A_man_not_your_man]

I believe on Schwabs platform you can only purchase entire shares, so this makes sense for their platform.

No complaints from me, my around 150 shares will now be around 450 and I can sell more covered calls. Great video!

[nad]

And it also makes it easier to sell cash secured puts since it will require less capital in your investing account.