1 Unstoppable Dividend ETF Up 26% in 2026 to Buy and Hold for the Next 20 Years
2026-07-31 14:18
•Neil Patel •The Motley Fool
••••••• •••• Axe Cap view
Is the U.S. Dividend ETF SCHD Worth Watching from South Africa?
SCHD's strong 2026 run spotlights resilient dividend payers, but what does it mean for local investors?
The Schwab U.S. Dividend Equity ETF (SCHD) has delivered an eye-catching 26% gain year-to-date in 2026, largely due to its focus on steady, well-established dividend payers in healthcare and consumer staples. For South African investors, the appeal is clear—stable income and long-term growth in uncertain times. But here’s the rub: the rand’s performance against the dollar will heavily influence returns for local buyers. While the rand has bounced this year, it remains vulnerable to local policy missteps and global risk-off sentiment. This currency risk means SCHD isn’t a set-and-forget investment for most JSE participants. Instead, consider it a portfolio hedge against local economic volatility, especially given weak domestic yield alternatives. Just remember, if the rand weakens sharply, your dollar gains can erode significantly. this is just our opinion and not financial advice
Watch USD/ZAR closely before buying SCHD—if the rand looks stable or stronger, add small exposure as a hedge. Otherwise, hold local dividend stocks like Standard Bank or Naspers for income until currency risk eases.
- SCHD
- USD/ZAR
- Standard Bank
- Naspers
- Rand depreciation eroding returns
- U.S. interest rate shifts impacting dividend stability
6/10
The Schwab U.S. Dividend Equity ETF (SCHD) has delivered a 26% return year-to-date in 2026, significantly outperforming the S&P 500. The ETF focuses on 100 high-quality dividend-paying companies with at least 10 years of consecutive dividend payments, featuring a low 0.06% expense ratio and 3.3% dividend yield. Its portfolio emphasizes healthcare and consumer staples sectors, making it suitable for long-term buy-and-hold investors seeking stability and passive income.
Our take is based on reporting first published by The Motley Fool.