Work out a stock's or fund's dividend yield from its share price and dividend, entered either as a yearly total or as one payment times the payout frequency. Add your shares and cost to see yield on cost, yearly income before and after tax, and how many shares it takes to reach a monthly income goal.
Last updated:
Stock and dividend
$
Dividend entered as
$
$
Forward or trailing 12-month total
Your position (optional)
$
For yield on cost
%
Qualified dividends: 0%, 15% or 20%
$
Shares needed to reach it
Enter your values to see the result.
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How to use the Dividend Yield Calculator
Enter the share price the stock or fund trades at now.
Enter the dividend: one payment and how often it is paid, or the annual dividend per share.
Add your position (optional): shares owned, average cost per share and your dividend tax rate.
Set a monthly income goal (optional) to see how many shares you would need.
Press Calculate yield for the yield, yield on cost, income and a table of yields at other prices.
Dividend yield formula
Dividend yield (%) = Annual dividend per share ÷ Price per share × 100
When a company pays a fixed amount each period, the annual dividend is the payment multiplied by the number of payments per year: monthly payers × 12, quarterly × 4, semi-annual × 2. Most US companies pay quarterly; many REITs, closed-end funds and bond funds pay monthly; many European and Asian companies pay twice a year.
Two related figures use the same idea with different denominators:
Yield on cost = annual dividend ÷ your average purchase price. It rises over time if the company keeps raising its dividend.
Income from a position = annual dividend × shares owned, which also equals position value × yield.
Annual income from $10,000 at different yields
Dividend yield
Annual income
Monthly average
Invested needed for $1,000/month
1%
$100
$8.33
$1,200,000
2%
$200
$16.67
$600,000
3%
$300
$25.00
$400,000
4%
$400
$33.33
$300,000
5%
$500
$41.67
$240,000
6%
$600
$50.00
$200,000
8%
$800
$66.67
$150,000
Figures are before tax and assume the dividend stays the same. Capital needed = $12,000 a year ÷ yield.
Reading a dividend yield sensibly
Check the payout ratio (dividends ÷ earnings, or ÷ free cash flow). A ratio well above 100% means the dividend is not covered by profits.
Beware yield traps: a yield that jumps because the price collapsed often comes before a dividend cut.
Special dividends are one-off payments. Leave them out of the annual figure or the yield will look higher than it really is.
Funds and ETFs quote a distribution yield and often a 30-day SEC yield; the SEC yield is standardized and better for comparing bond funds.
Total return matters: a 4% yield with a falling price can lose money, while a 1% yield with strong growth can do better overall.
Frequently asked questions
How do you calculate dividend yield?
Dividend yield = annual dividend per share ÷ share price × 100. A stock trading at $50 that pays $0.50 every quarter pays $2.00 a year, so its yield is 2 ÷ 50 = 4%.
What is the difference between forward and trailing yield?
Trailing yield uses the dividends actually paid over the last 12 months. Forward yield annualizes the most recent declared dividend (for example the latest quarterly payment × 4). They differ when a company has just raised or cut its dividend.
What is yield on cost?
Yield on cost divides today's annual dividend by the price you originally paid. If you bought at $40 and the stock now pays $2 a year, your yield on cost is 5% even though the current yield at $50 is 4%. It shows how dividend growth has rewarded long-term holders.
Why does dividend yield go up when the stock price falls?
Yield is the dividend divided by the price. If the dividend stays the same and the price drops, each dollar invested buys more dividend, so the yield rises. A very high yield can be a warning that the market expects a cut.
What is a good dividend yield?
It depends on the market and sector. Broad US stock indexes have yielded well under 2% in recent years, while utilities, REITs and many established dividend payers commonly yield 3% to 5%. Very high yields deserve a closer look at payout ratio, debt and earnings.
How are dividends taxed in the US?
Qualified dividends are taxed at 0%, 15% or 20% depending on taxable income, plus 3.8% Net Investment Income Tax for high earners. Ordinary (non-qualified) dividends, including most REIT distributions, are taxed at your regular income tax rate. Dividends in IRAs and 401(k)s are not taxed when paid.
How many shares do I need for $500 a month in dividends?
Shares needed = monthly goal × 12 ÷ annual dividend per share. With a $2.00 annual dividend you need 3,000 shares for $6,000 a year. At a $50 price that is $150,000 invested, which equals the goal divided by the 4% yield.
Are all the tools on FreeToolCabin tested for quality and accuracy?
Yes! Every tool on our site undergoes automated Q/A testing in real browser environments to ensure high precision, correct output, and zero errors. If you happen to spot a bug or have a suggestion, please contact us at [email protected] and our team will review it right away.