Finance
What is Dividend yield?
Dividend yield is the annual dividend a stock pays expressed as a percentage of its price. If a $100 stock pays $4 a year, its yield is 4%. It helps investors compare how much income different dividend-paying stocks provide.
See it, don’t just read it.
Watch a 2-minute lesson with voice + animation that explains dividend yield.
Key things to understand
- 1It's annual dividends as a percent of share price.
- 2Higher yield means more income per dollar invested.
- 3It moves opposite to price: if price falls, yield rises.
- 4Very high yields can signal risk, not just reward.
Frequently asked questions
- What is dividend yield?
- A stock's yearly dividend as a percentage of its current price, showing the income it provides.
- How do you calculate dividend yield?
- Divide the annual dividend per share by the share price, then multiply by 100.
- Is a high dividend yield always good?
- Not necessarily — a very high yield can mean the price has fallen due to trouble, risking a dividend cut.