Schwab International Dividend Equity ETF (SCHY) Covered Calls

The Schwab International Dividend Equity ETF is an exchange-traded fund that tracks the Dow Jones International Dividend 100 Index. The fund provides low-cost exposure to high-quality, sustainable dividend-paying companies located outside of the United States. By screening for financial strength, profitability, and payout consistency, the fund offers a diversified portfolio of non-U.S. equities designed for investors seeking defensive income and long-term capital appreciation.

You can sell covered calls on Schwab International Dividend Equity ETF to lower risk and earn monthly income. Born To Sell's covered call screener gives you customized search capabilities across all possible covered calls but here are a couple of examples for SCHY (prices last updated Fri 4:16 PM ET):

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Schwab International Dividend Equity ETF (SCHY) is a passively managed exchange-traded fund designed to serve as a high-quality international counterpart to the popular SCHD. It targets established international companies with a strong track record of paying dividends and the financial health to sustain them through varying market cycles.

Investment Strategy and Holdings

The fund tracks the Dow Jones International Dividend 100 Index, which applies a rigorous screening process. Stocks must have at least 10 consecutive years of dividend payments and meet specific fundamental criteria, including return on equity and cash flow to debt. As of March 2026, the fund is diversified across developed markets in Europe and the Pacific. Major holdings that trade as liquid ADRs include BHP Group, TotalEnergies, GSK plc, Rio Tinto, and Unilever. This "quality-first" approach helps the fund avoid "yield traps" and provides a tilt toward value sectors.

Competitive Landscape

SCHY competes in the crowded international income space, where low fees and quality screens are primary differentiators. Its closest rivals include the Vanguard International High Dividend Yield ETF and the iShares International Select Dividend ETF. Investors also frequently compare it to the Vanguard International Dividend Appreciation ETF, which focuses on dividend growth rather than high current yield. Additionally, for those looking at broader international value, the iShares MSCI EAFE Value ETF serves as a notable peer. These funds all maintain active options markets for covered call and hedging strategies.

Strategic Outlook and Performance

The outlook for the fund remains positive for investors seeking to diversify away from U.S. concentration. Because SCHY excludes technology-heavy U.S. markets, it often performs well during periods of value rotation or when international markets catch up to domestic growth. The fund’s methodology naturally leads to higher weightings in the Financials, Consumer Staples, and Healthcare sectors, which typically offer more stability during economic volatility. By maintaining a very low expense ratio of 0.08%, the fund ensures that a greater portion of the underlying dividends is passed through to the shareholder.

Schwab Asset Management emphasizes the fund’s role as a core building block for a global income portfolio. The fund is reconstituted annually to ensure that all constituents continue to meet the strict quality and yield requirements of the index. This disciplined rebalancing helps the fund stay aligned with its defensive objective while capturing growth in international markets. For long-term investors, SCHY provides a systematic, cost-effective way to generate overseas income and benefit from the compounding effect of reinvested dividends in a tax-efficient ETF structure.

Want more examples? SCHX Covered Calls | SCHZ Covered Calls