3 Monthly Dividend ETFs Outperforming SCHD

The Amplify CWP Enhanced Dividend Income ETF (DIVO) distinguishes itself through a sophisticated covered call strategy applied to a concentrated portfolio of 20-25 high-quality dividend stocks. This approach allows the fund to generate additional income by opportunistically selling call options on its holdings, targeting gross annual income of 2-3% from dividends and 2-4% from options premiums. The strategy is designed to enhance yield without severely capping upside potential, creating a balanced approach to income generation.

DIVO’s performance speaks to the effectiveness of this methodology. Over the past ten years, the ETF has delivered total returns of 108.25%, translating to an annualized return of 8.72%. This significantly outpaces SCHD’s 85.76% total return and 7.31% annualized performance over the same period. The performance gap has widened more recently, demonstrating DIVO’s resilience in varying market conditions. With a current yield of 4.73% paid monthly—substantially higher than SCHD’s 3.82% quarterly distribution—and an expense ratio of 0.56%, DIVO offers income-focused investors a compelling alternative to traditional dividend ETFs.

The SPDR Dow Jones Industrial Average ETF Trust (DIA) provides investors with exposure to the 30 blue-chip components of the Dow Jones Industrial Average, offering a unique blend of stability and growth potential. Unlike SCHD’s dividend-focused methodology, DIA’s composition leans heavily toward financials, technology, and industrial sectors, with Goldman Sachs (10.68%), Microsoft (6.82%), and Caterpillar (6.26%) representing its largest holdings. This sector concentration has contributed to DIA’s impressive long-term track record.

Over the past decade, DIA has returned 156.81%, or 9.89% annually, outperforming both SCHD and demonstrating lower volatility than the broader S&P 500. While its 1.46% yield is modest compared to dedicated dividend ETFs, DIA’s monthly distribution schedule and exceptionally low 0.16% expense ratio make it an attractive option for investors seeking broad market exposure with the convenience of regular income. The fund’s bias toward financial and technology stocks has particularly benefited it during market rallies, providing an additional performance boost beyond what traditional dividend strategies typically deliver.

The Amplify CWP Growth & Income ETF (QDVO) represents a more aggressive approach to dividend investing, combining growth-oriented stock selection with income generation through option premiums. As an actively managed fund, QDVO maintains significant exposure to artificial intelligence megatrends, with Nvidia (10.19%), Apple (9.45%), and Microsoft (8.64%) comprising its top holdings. This AI-focused positioning differentiates it from both SCHD’s dividend-centric approach and DIVO’s more conservative covered call strategy.

Despite being relatively new to the market, QDVO has delivered impressive results, returning 26.66% since inception (24.28% annualized) while generating a remarkable 11.66% yield through monthly distributions. The fund’s option premium strategy amplifies income while maintaining exposure to high-growth technology stocks. While its 0.55% expense ratio is higher than traditional index ETFs, QDVO’s unique combination of growth orientation and substantial income generation makes it particularly suited for investors bullish on continued AI momentum. The fund’s performance suggests it could continue outperforming if technology-driven market trends persist.

Collectively, these three ETFs offer a blended dividend yield of 5.9%, substantially higher than SCHD’s 3.82%, while providing monthly income distributions that facilitate faster compounding and greater cash flow flexibility. The diversification benefits extend beyond yield enhancement—each fund employs a distinct methodology that performs differently across market cycles. DIVO’s covered call strategy provides consistent income with moderate growth, DIA offers blue-chip stability with market-matching returns, and QDVO delivers growth-oriented exposure with exceptional yield potential.

For retirement-focused investors, the monthly distribution schedule of these ETFs provides practical advantages, whether for reinvestment during accumulation phases or for covering living expenses during retirement. While SCHD remains a solid core holding for dividend portfolios, incorporating these outperforming alternatives can enhance overall returns while reducing concentration risk associated with a single methodology. The demonstrated long-term outperformance of DIVO and DIA, coupled with QDVO’s promising start, suggests that investors may benefit from looking beyond the traditional dividend ETF benchmark when constructing income-oriented portfolios.