PAAA vs SCHD
PAAA vs SCHD
PGIM AAA CLO ETF vs Schwab US Dividend Equity ETF
Quick Verdict
SCHD has a lower expense ratio. SCHD delivered stronger 1-year returns. SCHD offers more diversification with 100 holdings.
Side-by-Side Comparison
| Metric | PAAA | SCHD | Winner |
|---|---|---|---|
| Expense Ratio | 0.19% | 0.06% | |
| AUM | $11.2B | $103.7B | |
| Dividend Yield | 5.67% | 3.31% | |
| Holdings | 355 | 104 | |
| YTD Return | +2.70% | +22.69% | |
| 1Y Return | +5.00% | +30.94% | |
| 3Y Return (annualized) | +6.49% | +14.20% | |
| 5Y Return (annualized) | - | +9.59% | |
| Volatility (annualized) | 0.7% | 13.7% | |
| Max Drawdown | -1.0% | -33.4% | |
| Fund Family | PGIM Investments | Charles Schwab Asset Management | |
| Category | Fixed Income | Equity | |
| Inception | Jul 19, 2023 | Oct 20, 2011 |
PAAA vs SCHD Performance
PGIM AAA CLO ETF (PAAA) is a ETF from PGIM Investments and Schwab US Dividend Equity ETF (SCHD) is a ETF from Charles Schwab Asset Management. Over the past year PAAA returned +5.00% while SCHD returned +30.94%. Year to date, PAAA is up 2.70% versus a gain of 22.69% for SCHD.
Over three years, PAAA compounded at +6.49% per year against +14.20% for SCHD. Across the full 3-year window we track, SCHD has the edge at +11.31% annualized vs +6.48%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
SCHD has been the more volatile fund, with annualized monthly volatility of 13.7% compared with 0.7% for PAAA. 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 -1.0% for PAAA 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 0.26. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
PAAA charges 0.19% per year while SCHD charges 0.06%. On a $10,000 position that is $19 vs $6 annually, a gap of $13 per year that compounds over a long holding period. On income, PAAA currently yields 5.67% against 3.31% for SCHD.
Holdings Overlap
PAAA and SCHD share 0 holdings out of 168 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, PAAA or SCHD?
PAAA has an expense ratio of 0.19% while SCHD charges 0.06%. SCHD is the cheaper option. On a $10,000 investment, that is $13 per year of difference.
Which performed better, PAAA or SCHD?
Over the past year PAAA returned +5.00% vs +30.94% for SCHD, so SCHD leads on 1-year performance. Over the longest common window we track (3 years), PAAA annualized +6.48% vs +11.31% for SCHD. Past performance does not guarantee future results.
Which is riskier, PAAA or SCHD?
SCHD has been the more volatile fund at 13.7% annualized versus 0.7% for PAAA. Worst drawdown: PAAA -1.0% vs SCHD -33.4%.
Should I hold both PAAA and SCHD?
PAAA and SCHD have a monthly-return correlation of 0.26, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between PAAA and SCHD?
PAAA and SCHD share 0 common holdings with a 0.0% weight overlap. Combined, they hold 168 unique securities.
Which pays a higher dividend, PAAA or SCHD?
PAAA yields 5.67% while SCHD yields 3.31%, so PAAA currently pays the higher dividend yield.
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