Dividend Yield Ratio

Written by True Tamplin, BSc, CEPF®

Reviewed by Subject Matter Experts

Updated on February 26, 2023

The dividend yield ratio shows the percentage return to investors on the market value of the preference or ordinary shares that they own.

Like the dividend coverage ratio, this ratio is also calculated separately for each class of shares.


For preference shares:

Dividend Yield Ratio For Preference Shares

For ordinary shares:

Dividend Yield Ratio For Ordinary Shares

The dividend is often a major part of all that a shareholder receives from a company for their investment in shares.

Hence, the dividend yield ratio frequently represents a significant portion of the return going to the shareholder in the form of dividends.

Dividend Yield Ratio FAQs

About the Author

True Tamplin, BSc, CEPF®

True Tamplin is a published author, public speaker, CEO of UpDigital, and founder of Finance Strategists.

True is a Certified Educator in Personal Finance (CEPF®), author of The Handy Financial Ratios Guide, a member of the Society for Advancing Business Editing and Writing, contributes to his financial education site, Finance Strategists, and has spoken to various financial communities such as the CFA Institute, as well as university students like his Alma mater, Biola University, where he received a bachelor of science in business and data analytics.

To learn more about True, visit his personal website or view his author profiles on Amazon, Nasdaq and Forbes.