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CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 73% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 73% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

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What Is the Dividend Yield?

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Stocks Glossary
Reading time: 1 minute(s)
The dividend yield is calculated by dividing the annual dividends of the company by the current price of the share. It is represented by a percentage.
  • The dividend yield is calculated by dividing the annual dividends of the company by the current price of the share.
  • It is represented by a percentage.

Dividend yield is a measure of the productivity of your investment, and generally indicates how much money you will get in relation to how much money you have invested in an open position.

Does this mean that you should invest in stocks of companies that provide the highest dividend yield? Not necessarily, because the benefits obtained by investing in stocks are not based only on dividends, but also on the increase in the value of the company's price in the market. What's more, a company that pays the highest dividends does not reinvest its earnings in growth and expansion.

This content has been created by XTB S.A. This service is provided by XTB S.A., with its registered office in Warsaw, at Prosta 67, 00-838 Warsaw, Poland, entered in the register of entrepreneurs of the National Court Register (Krajowy Rejestr Sądowy) conducted by District Court for the Capital City of Warsaw, XII Commercial Division of the National Court Register under KRS number 0000217580, REGON number 015803782 and Tax Identification Number (NIP) 527-24-43-955, with the fully paid up share capital in the amount of PLN 5.869.181,75. XTB S.A. conducts brokerage activities on the basis of the license granted by Polish Securities and Exchange Commission on 8th November 2005 No. DDM-M-4021-57-1/2005 and is supervised by Polish Supervision Authority.

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