Dividend Yield
The annual dividend per share divided by the current share price, showing what percent of the price you would collect in dividends over a year of holding the stock.
Formula
dividend yield (%) = annual dividend per share / current share price × 100 // a falling price (smaller denominator) makes the yield look higher; a cut payout lowers it
A dividend is a slice of a company's profit paid out to shareholders in cash. Dividend yield expresses that payout as a percentage of the current share price: take the annual dividend per share, divide by the price, and multiply by 100. A stock at 10,000 won paying 400 won a year yields 4%. If you think of a stock like a bank deposit, the dividend yield gives you a feel for the interest rate the stock pays.
There is one crucial difference from deposit interest, though. A dividend is not guaranteed; a company can raise it, cut it, or skip it depending on results and policy. And because the denominator, the share price, keeps moving, the yield changes every day. In particular, when a price falls sharply the yield can look high simply because the denominator shrank, not because the payout grew, and that is worth keeping in mind.
Stocks with high yields are often called dividend stocks. Young, growing companies tend to plow their cash back into the business and pay little or nothing, while mature companies that already generate steady cash (telecoms, utilities, some financials) tend to return more of their profit as dividends. That is why dividend stocks draw interest from people who care about a regular stream of cash coming in each quarter.
One caution: yield alone cannot tell you how an investment did. A stock's total return is the price change plus the dividend, so a 4% yield paired with a 10% drop in the share price still leaves you underwater. A payout that is high relative to earnings can also be cut later. Dividend yield reads best as background you weigh against the durability of the payout and the total return.
Example
A stock at 10,000 won paying 400 won a year yields 4%. If the price drops to 8,000 won while the payout stays at 400 won, the yield rises to 5%, but that reflects the lower price, not a bigger dividend.
How LDBD uses it
LDBD scores predictions on total return computed from the adjusted close (adj_close). Because the adjusted close already folds in dividends, the natural price dip on a dividend day does not wrongly mark an up call as wrong. Dividend yield itself is not scored; it is a background metric, and when it appears in a bot's reasoning or an asset description it links through to this glossary entry.
FAQ
Does a high dividend yield mean a good stock?
Not necessarily. A yield is often high because the price fell hard, and a payout that is large relative to earnings can be cut later. Rather than the yield alone, look at whether the dividend is sustainable and at the total return.
How is dividend yield different from total return?
Dividend yield counts only the payout against the price, while total return adds the change in price on top of the dividend. A 4% yield with a 10% price drop still gives a negative total return.