How this is calculated

Dividend yield = annual dividend per share ÷ current share price. Enter the dividend the company or fund pays each year for one share, and the price you would pay for that share today. Multiply by 100 to express it as a percentage.

Worked example

A share trading at $100 that pays $4 a year gives 4 ÷ 100 = 0.04, or a 4% yield. If the same $4 dividend is paid while the price falls to $80, the yield rises to 4 ÷ 80 = 5% — the payout did not change, the price did.

What dividend yield shows

Dividend yield is annual dividend per share divided by the current share price. It changes when either the price or dividend changes and does not measure total return.

FAQ

Are dividends guaranteed?

No. Companies and funds can reduce, suspend, or change distributions.

Does this include tax?

No. Tax treatment depends on your country, account type, and personal circumstances.