1. What is Dividend Yield?

The Dividend Yield is a financial ratio that shows how much a company pays out in dividends each year relative to its stock price. It's an important metric for income investors evaluating potential investments.

2. How Does the Calculator Work?

The calculator uses the dividend yield formula:

Where:

• \( Dividend \) — Annual dividend per share (in currency)
• \( Price \) — Current stock price (in currency)

Explanation: The formula calculates what percentage return an investor can expect from dividends alone, excluding any capital gains.

3. Importance of Dividend Yield

Details: Dividend yield helps investors compare income-generating stocks and assess whether a stock's dividend is sustainable relative to its price.

4. Using the Calculator

Tips: Enter the annual dividend per share and current stock price in the same currency. Both values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What's a good dividend yield?
A: This varies by industry and market conditions. Generally, 2-6% is common for stable companies, but extremely high yields may indicate risk.

Q2: Should I only invest in high-yield stocks?
A: Not necessarily. Consider dividend sustainability, company growth, and total return potential, not just yield.

Q3: How often is dividend yield calculated?
A: Yield is dynamic and changes with stock price movements and dividend adjustments.

Q4: Does yield include special dividends?
A: Typically no - yield calculations usually use regular dividends only.

Q5: Why do some stocks have 0% yield?
A: Companies that don't pay dividends will have 0% yield, common among growth stocks that reinvest profits.