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Dividend yield
The dividends paid over the last year as a percentage of today’s share price.
If a share costs R100 and paid R5 in dividends over the last 12 months, its dividend yield is 5%.
The yield rises when the price falls and falls when the price rises, even if the dividend stays the same. A very high yield can be a warning that the market expects the dividend to be cut.
More terms
- Price to earnings (P/E)The share price divided by the profit per share: how many years of today’s profit you pay for.
- Ex-dividend dateThe first day a share trades without its next dividend.
- Payout ratioThe share of its profit a company pays out as dividends.
- Market value (market capitalisation)The share price times the number of shares: what the market says the whole company is worth.
- IndexOne number that tracks a basket of shares, so you can see how a whole market or sector is doing.
- RebalancingResetting an index’s members and weights on a fixed timetable.
- Every term ↗
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