ITOT vs. SCHB: ETF Comparison Guide
This article will compare ITOT vs. SCHB to help you determine which is best for your portfolio.
Both ITOT and SCHB track the total stock market, with over 2,500 companies within their holdings.
While there are not many significant differences, the funds are managed by different institutions, Blackrock (ITOT) and Schwab (SCHB).
ITOT vs. SCHB Overview
The iShares Core S&P Total U.S. Stock Market ETF (ITOT) is an exchange-traded fund by BlackRock that seeks to track the performance of the S&P Composite 1500 Index. Launched on Jan 20, 2004, its goal is to bring the essence of S&P’s total market coverage into your portfolio through diligent replication.
The Schwab U.S. Broad Market ETF (SCHB), on the other hand, launched by Charles Schwab on Nov 3, 2009, aims to track the total return of the Dow Jones U.S. Broad Stock Market Index, covering a broader spectrum of the US equity market.
Researching ETFs is a time-consuming process and requires a lot of knowledge to ensure you make the best decisions for your money. If you want to accelerate your learning curve in finance and investing, you can join the HaiKhuu Trading Community.
HaiKhuu offers live trading calls, daily morning reports, and an awesome community of like-minded traders to learn from.
Expense Ratio Comparison
Lower expense ratios translate into higher profits for investors. Both ITOT and SCHB shine in this aspect with the same exceptionally low expense ratio of just 0.03%.
This means that for every $10,000 invested, you’re only paying $3 in fees per year. This low expense appeals to cost-conscious investors, making both ETFs highly competitive.
Dividend Yield Comparison
Dividends are a crucial factor for income-focused investors.
As of the most recent data, both ITOT and SCHB also square off evenly here, each offering a comparable dividend yield of 1.45%.
Holdings Comparison
ITOT holds around 2,500 companies, with its top holdings consisting of big techs like Microsoft and Apple.
In contrast, SCHB also holds about 2,500 US stocks, providing relatively similar exposure to ITOT.
Both hold a similar basket of top holdings with giants like Apple, Microsoft, and Amazon, revealing a similar risk profile.
Performance Comparison
ITOT and SCHB provide nearly identical returns, as both invest in similar companies.
Any disparities can often be attributed to differing market reactions given the contrasting compositions and particular holdings' influence over index performance.
Which Is Better For You?
Ultimately, the decision boils down to your individual investment goals, risk tolerance, and portfolio structure. Both ITOT and SCHB present robust opportunities with their broad market exposure, low expense ratio, and decent dividend yields.
The choice between ITOT and SCHB should primarily be based on which broker you use, but both are available on just about all of them. The official brokerage of HaiKhuu Trading is tastytrade, which lets you invest in these ETFs and many other stocks and cryptocurrencies.
FAQ
Is SCHB a Good Investment?
Yes, SCHB is considered a good investment due to its lower expense ratio, comprehensive exposure to the U.S. stock market, and strong long-term performance. However, all investments carry risks, and potential returns from SCHB should be weighed against these risks.
