My Economy Guide will explain the concept of dividend yield in this article . Investors who want to achieve the goal of dividend retirement and achieve a life of high welfare through long-term investments may have more successful investments by carefully examining this article. Let’s take a closer look at the concept of dividend yield.
What is dividend yield?
The stock is a very attractive investment tool for investors with its dividend income. However, in order to use this investment instrument more efficiently, it is necessary to look closely at some indicators and choose the right company stocks accordingly. Dividend yield is the ratio of dividend income paid per share to that stock price. The higher this rate, the higher the dividend yield , the higher the money earned compared to the main currency used in the investment.As can be understood from the reasons mentioned above, high-yield stocks should be preferred for a high-yield stock investment.
HOW IS THE DIVIDEND Yield CALCULATED?
Let us convey the concept of dividend yield to your formula and show you how to calculate the dividend yield .Dividend yield = Dividend income / share price per shareLet us express this formula with an example. Suppose we have one Aselsan stock and we think that the price is approximately 20 pounds. Let us assume that our annual dividend income is 1 lira. Let’s apply our formula.1 Turkish Lira / 20 Turkish Lira = 0,05To better understand the value of 0.05, let’s multiply it by 100 and see how many percent of the dividend yield is.0.05 × 100 = 5DIVIDEND YIELD = 5% You can calculate the dividend yield by performing the above steps and make your investment as you see fit.