HIO vs SCHD
HIO vs SCHD
Western Asset High Income Opportunity Fund Inc. vs Schwab US Dividend Equity ETF
Quick Verdict
SCHD has a lower expense ratio. SCHD delivered stronger 1-year returns. HIO offers more diversification with 213 holdings.
Side-by-Side Comparison
| Metric | HIO | SCHD | Winner |
|---|---|---|---|
| Expense Ratio | 0.94% | 0.06% | |
| AUM | $365M | $103.7B | |
| Dividend Yield | 10.92% | 3.31% | |
| Holdings | 338 | 104 | |
| YTD Return | +2.67% | +23.53% | |
| 1Y Return | -0.06% | +30.95% | |
| 3Y Return (annualized) | +8.65% | +14.72% | |
| 5Y Return (annualized) | +2.10% | +9.56% | |
| Volatility (annualized) | 13.4% | 13.6% | |
| Max Drawdown | -76.3% | -33.4% | |
| Fund Family | Franklin Templeton Investments (US) | Charles Schwab Asset Management | |
| Category | Fixed Income | Equity | |
| Inception | Oct 22, 1993 | Oct 20, 2011 |
HIO vs SCHD Performance
Western Asset High Income Opportunity Fund Inc. (HIO) is a ETF from Franklin Templeton Investments (US) and Schwab US Dividend Equity ETF (SCHD) is a ETF from Charles Schwab Asset Management. Over the past year HIO returned -0.06% while SCHD returned +30.95%. Year to date, HIO is up 2.67% versus a gain of 23.53% for SCHD.
Over three years, HIO compounded at +8.65% per year against +14.72% for SCHD; over five years the annualized figures are +2.10% and +9.56% respectively. Across the full 15-year window we track, SCHD has the edge at +11.35% annualized vs -2.04%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
SCHD has been the more volatile fund, with annualized monthly volatility of 13.6% compared with 13.4% for HIO. Lower volatility generally means a smoother ride, though it often comes with lower long-run returns.
The deepest peak-to-trough decline in our data was -76.3% for HIO and -33.4% for SCHD. Drawdown depth is worth weighing if you expect to sell during market stress rather than ride it out.
The two funds' monthly returns correlate at 0.64. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
HIO charges 0.94% per year while SCHD charges 0.06%. On a $10,000 position that is $94 vs $6 annually, a gap of $88 per year that compounds over a long holding period. On income, HIO currently yields 10.92% against 3.31% for SCHD.
Holdings Overlap
HIO and SCHD share 0 holdings out of 313 unique holdings combined, representing a 0.0% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, HIO or SCHD?
HIO has an expense ratio of 0.94% while SCHD charges 0.06%. SCHD is the cheaper option. On a $10,000 investment, that is $88 per year of difference.
Which performed better, HIO or SCHD?
Over the past year HIO returned -0.06% vs +30.95% for SCHD, so SCHD leads on 1-year performance. Over the longest common window we track (15 years), HIO annualized -2.04% vs +11.35% for SCHD. Past performance does not guarantee future results.
Which is riskier, HIO or SCHD?
SCHD has been the more volatile fund at 13.6% annualized versus 13.4% for HIO. Worst drawdown: HIO -76.3% vs SCHD -33.4%.
Should I hold both HIO and SCHD?
HIO and SCHD have a monthly-return correlation of 0.64, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between HIO and SCHD?
HIO and SCHD share 0 common holdings with a 0.0% weight overlap. Combined, they hold 313 unique securities.
Which pays a higher dividend, HIO or SCHD?
HIO yields 10.92% while SCHD yields 3.31%, so HIO currently pays the higher dividend yield.
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