Plain-English definitions, reviewed by an independent investor
Dividend Yield
Dividend yield is the annual cash dividend as a percentage of the share price.
Dividend yield is the annual cash dividend as a percentage of the share price.
Dividend Yield = Annual Dividend per Share ÷ Share Price × 100%
Why it matters
It shows the income you earn just for holding the stock.
Common confusion
A very high yield can signal a falling price and a dividend at risk of being cut.
Frequently Asked Questions
Is a high dividend yield good?
It pays more income, but check the payout is sustainable and not a distress signal.
Does yield change with price?
Yes. The dividend is fixed-ish, so as the price falls the yield rises.