market
DivY Dividend Yield
Annual dividend payment as a percentage of the stock price. The "interest rate" you earn just for holding the stock.
Formula
Dividend Yield = (Annual Dividend Per Share / Share Price) × 100
How to Interpret
S&P 500 average is ~1.5%. Above 4% may signal either generous payouts or a falling stock price. Very high yields (8%+) can be "dividend traps" — the company may cut the dividend soon.
Why It Matters
For income investors, dividend yield is the primary metric. But dividends also signal management confidence — companies that can afford to pay consistent dividends are usually generating reliable cash flow.
Example
A stock paying a $2 annual dividend and trading at $50 has a 4% dividend yield ($2 ÷ $50 × 100). A lower share price raises the yield if the dividend stays unchanged.