What is Dividend Yield
5paisa Research Team
Last Updated: 06 Jun, 2025 03:03 PM IST

Content
- What is dividend yield in stocks: Understanding dividend yield
- Calculating the Dividend Yield
- Example of Dividend Yield
- Dividend Payout Ratio
- Which Industries Offer the Best Dividend Yields for Investors?
- Advantages of dividend yield
- Disadvantages of Dividend Yields
- Price vs. Yield: How Stock Market Price Impacts Your Dividend Returns?
- What Affects Dividend Yield?
- Dividend yield vs. dividend payout ratio
- Is a high yield always best?
- The bottom line
The dividend yield, expressed as a percentage, is a financial ratio that presents the amount a company pays in dividends each year relative to its stock price. The reciprocal of the dividend yield is the dividend payout ratio. This article discusses what does dividend yield mean and what is dividend yield in the share market.
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Frequently Asked Questions
A high dividend yield may suggest the company is paying higher than usual dividends to its shareholders.
Due to their minimal risk, these funds can be excellent investments for novice & low-risk investors.
Yes, this may be the case. The current stock price is the denominator in the dividend yield formula. The lower the denominator, the higher the dividend yield value.
Securities & Exchange Board of India, or SEBI, states that dividend yield fund must allocate at least 65% of its portfolio to dividend-paying securities.
Because these funds frequently make investments in established or large-cap firms, they provide steady return. These products are available to investors who are looking for dependable returns and, more crucially, recurring dividend income.
Investors looking for steady income stream from their assets might consider dividend yield funds, which are passive income-generating vehicles. Identifying & investing in stocks that regularly distribute dividends to investors is main objective of dividend yield funds, not capital gains.