GLD vs. SCHA: What’s The Difference?

The SPDR Gold Shares (GLD) and the Schwab U.S. Small-Cap ETF (SCHA) are both among the Top 100 ETFs. GLD is a SPDR State Street Global Advisors N/A fund and SCHA is a Schwab ETFs Small Blend fund. So, what’s the difference between GLD and SCHA? And which fund is better?

The expense ratio of GLD is 0.36 percentage points higher than SCHA’s (0.4% vs. 0.04%). GLD also has a lower exposure to the technology sector and a lower standard deviation. Overall, GLD has provided lower returns than SCHA over the past ten years.

In this article, we’ll compare GLD vs. SCHA. We’ll look at industry exposure and holdings, as well as at their fund composition and risk metrics. Moreover, I’ll also discuss GLD’s and SCHA’s performance, annual returns, and portfolio growth and examine how these affect their overall returns.

Summary

GLD SCHA
Name SPDR Gold Shares Schwab U.S. Small-Cap ETF
Category N/A Small Blend
Issuer SPDR State Street Global Advisors Schwab ETFs
AUM 59.26B 16.51B
Avg. Return 5.81% 12.62%
Div. Yield 0.0% 0.98%
Expense Ratio 0.4% 0.04%

The SPDR Gold Shares (GLD) is a N/A fund that is issued by SPDR State Street Global Advisors. It currently has 59.26B total assets under management and has yielded an average annual return of 5.81% over the past 10 years. The fund has a dividend yield of 0.0% with an expense ratio of 0.4%.

The Schwab U.S. Small-Cap ETF (SCHA) is a Small Blend fund that is issued by Schwab ETFs. It currently has 16.51B total assets under management and has yielded an average annual return of 12.62% over the past 10 years. The fund has a dividend yield of 0.98% with an expense ratio of 0.04%.

GLD’s dividend yield is 0.98% lower than that of SCHA (0.0% vs. 0.98%). Also, GLD yielded on average 6.82% less per year over the past decade (5.81% vs. 12.62%). The expense ratio of GLD is 0.36 percentage points higher than SCHA’s (0.4% vs. 0.04%).

FYI: The best way I've found to invest in ETFs is through M1 Finance. It's free and you even get an instant line of credit! Have a look here (link to M1 Finance).

Fund Composition

Industry Exposure

GLD vs. SCHA - Industry Exposure

GLD SCHA
Technology 0.0% 14.91%
Industrials 0.0% 15.37%
Energy 0.0% 3.35%
Communication Services 0.0% 3.5%
Utilities 0.0% 1.83%
Healthcare 0.0% 16.5%
Consumer Defensive 0.0% 3.75%
Real Estate 0.0% 7.83%
Financial Services 0.0% 14.49%
Consumer Cyclical 0.0% 14.48%
Basic Materials 0.0% 3.98%

The SPDR Gold Shares (GLD) has the most exposure to the Technology sector at 0.0%. This is followed by Industrials and Energy at 0.0% and 0.0% respectively. Consumer Cyclical (0.0%), Financial Services (0.0%), and Real Estate (0.0%) only make up 0.00% of the fund’s total assets.

GLD’s mid-section with moderate exposure is comprised of Consumer Defensive, Healthcare, Utilities, Communication Services, and Energy stocks at 0.0%, 0.0%, 0.0%, 0.0%, and 0.0%.

The Schwab U.S. Small-Cap ETF (SCHA) has the most exposure to the Healthcare sector at 16.5%. This is followed by Industrials and Technology at 15.37% and 14.91% respectively. Energy (3.35%), Communication Services (3.5%), and Consumer Defensive (3.75%) only make up 10.60% of the fund’s total assets.

SCHA’s mid-section with moderate exposure is comprised of Basic Materials, Real Estate, Consumer Cyclical, Financial Services, and Technology stocks at 3.98%, 7.83%, 14.48%, 14.49%, and 14.91%.

GLD is 14.91% less exposed to the Technology sector than SCHA (0.0% vs 14.91%). GLD’s exposure to Industrials and Energy stocks is 15.37% lower and 3.35% lower respectively (0.0% vs. 15.37% and 0.0% vs. 3.35%). In total, Consumer Cyclical, Financial Services, and Real Estate also make up 36.80% less of the fund’s holdings compared to SCHA (0.00% vs. 36.80%).

Holdings

GLD - Holdings

GLD Holdings Weight
Gold Trust 100.0%
N/A 0%
N/A 0%
N/A 0%
N/A 0%
N/A 0%
N/A 0%
N/A 0%
N/A 0%
N/A 0%

GLD’s Top Holdings are Gold Trust, N/A, N/A, N/A, and N/A at 100.0%, 0%, 0%, 0%, and 0%.

N/A (0%), N/A (0%), and N/A (0%) have a slightly smaller but still significant weight. N/A and N/A are also represented in the GLD’s holdings at 0% and 0%.

SCHA - Holdings

SCHA Holdings Weight
AMC Entertainment Holdings Inc Class A 0.67%
Caesars Entertainment Inc 0.51%
Cloudflare Inc 0.48%
NovoCure Ltd 0.45%
Plug Power Inc 0.41%
10x Genomics Inc Ordinary Shares – Class A 0.34%
GameStop Corp Class A 0.28%
RH 0.27%
Penn National Gaming Inc 0.27%
Axon Enterprise Inc 0.27%

SCHA’s Top Holdings are AMC Entertainment Holdings Inc Class A, Caesars Entertainment Inc, Cloudflare Inc, NovoCure Ltd, and Plug Power Inc at 0.67%, 0.51%, 0.48%, 0.45%, and 0.41%.

10x Genomics Inc Ordinary Shares – Class A (0.34%), GameStop Corp Class A (0.28%), and RH (0.27%) have a slightly smaller but still significant weight. Penn National Gaming Inc and Axon Enterprise Inc are also represented in the SCHA’s holdings at 0.27% and 0.27%.

NOTE: The easiest way to add diversification to your portfolio is to invest in real estate through Fundrise. You can become private real estate investor without the burden of property management! Check it out here (link to Fundrise).

Risk Analysis

GLD SCHA
Mean Return 0.21 1.14
R-squared 16.21 82.26
Std. Deviation 16.58 18.68
Alpha 3.91 -4.65
Beta 0.48 1.25
Sharpe Ratio 0.12 0.7
Treynor Ratio 1.21 9.62

The SPDR Gold Shares (GLD) has a Alpha of 3.91 with a Sharpe Ratio of 0.12 and a Standard Deviation of 16.58. Its Treynor Ratio is 1.21 while GLD’s R-squared is 16.21. Furthermore, the fund has a Beta of 0.48 and a Mean Return of 0.21.

The Schwab U.S. Small-Cap ETF (SCHA) has a Standard Deviation of 18.68 with a Treynor Ratio of 9.62 and a R-squared of 82.26. Its Sharpe Ratio is 0.7 while SCHA’s Alpha is -4.65. Furthermore, the fund has a Mean Return of 1.14 and a Beta of 1.25.

GLD’s Mean Return is 0.93 points lower than that of SCHA and its R-squared is 66.05 points lower. With a Standard Deviation of 16.58, GLD is slightly less volatile than SCHA. The Alpha and Beta of GLD are 8.56 points higher and 0.77 points lower than SCHA’s Alpha and Beta.

BTW: Uncorrelated crypto assets such as Bitcoin can serve as a hedge and mitigate risk. I've allocated around 5% of my portfolio to crypto assets through Gemini - the simplest and cheapest broker I've found! Click here to read more (link to Gemini).

Performance

Annual Returns

GLD vs. SCHA - Annual Returns

Year GLD SCHA
2020 23.68% 19.35%
2019 18.36% 26.54%
2018 -1.54% -11.75%
2017 11.41% 15.04%
2016 8.69% 19.88%
2015 -11.78% -4.24%
2014 -0.58% 6.53%
2013 -28.09% 39.59%
2012 5.26% 18.24%
2011 11.2% -2.95%
2010 27.25% 28.31%

GLD had its best year in 2010 with an annual return of 27.25%. GLD’s worst year over the past decade yielded -28.09% and occurred in 2013. In most years the SPDR Gold Shares provided moderate returns such as in 2012, 2016, and 2011 where annual returns amounted to 5.26%, 8.69%, and 11.2% respectively.

The year 2013 was the strongest year for SCHA, returning 39.59% on an annual basis. The poorest year for SCHA in the last ten years was 2018, with a yield of -11.75%. Most years the Schwab U.S. Small-Cap ETF has given investors modest returns, such as in 2017, 2012, and 2020, when gains were 15.04%, 18.24%, and 19.35% respectively.

Portfolio Growth

GLD vs. SCHA - Portfolio Growth

Fund Initial Balance Final Balance CAGR
GLD $10,000 $12,884 5.81%
SCHA $10,000 $30,035 12.62%

A $10,000 investment in GLD would have resulted in a final balance of $12,884. This is a profit of $2,884 over 10 years and amounts to a compound annual growth rate (CAGR) of 5.81%.

With a $10,000 investment in SCHA, the end total would have been $30,035. This equates to a $20,035 profit over 10 years and a compound annual growth rate (CAGR) of 12.62%.

GLD’s CAGR is 6.82 percentage points lower than that of SCHA and as a result, would have yielded $17,151 less on a $10,000 investment. Thus, GLD performed worse than SCHA by 6.82% annually.


Current recommendations:

Over the past years, I have discovered several tools and products that have helped me tremendously on my path to financial freedom:

P.S.: The links below are affiliate links, which means I receive a small commission at no extra cost to you when you sign up for one of the services. Thank you for your support!

1) Take a look at M1 Finance, my favorite broker. I love how easy it is to invest and maintain my portfolio with them. I can set up automatic transfers, rebalance my portfolio with one click and even borrow up to 35% of my assets at super low interest rates!

2) Fundrise is by far the best way I've found to invest in Real Estate. You can diversify your portfolio by investing in their eREITs or even allocate capital to individual properties (without the hassle of managing tenants!).

3) If you are interested in crypto, check out Gemini. I've started allocating a small amount of assets to the growing crypto space and Gemini has just been a breeze to use. Once you register, make sure to also open an Active Trader account to buy crypto at the lowest fees on the market (just 0.03%!).

To see all of my most up-to-date recommendations, check out the Recommended Tools section.

Leave a Reply