📝 What is Dividend Yield?

💸 What is Dividend Yield? Imagine you put ₹1,000 in a savings account at the bank 🏦. The bank gives you ₹50 at the end of the year as interest. 🎯 This is like the “return” you get on your investment! Similarly, when you buy shares of a company — the company may give you a reward called Dividend — a part of its profit shared with YOU, the shareholder! 🎉 🎯 What is Dividend? 👉 Dividend = Profit shared by the company to its shareholders 💰 ✔️ Some companies share profits as dividend 💵 ✔️ Some don’t — they keep the money to grow the business 🚀 🎯 What is Dividend Yield? 👉 Dividend Yield = (Dividend per Share ÷ Price per Share) × 100 It shows what % return you are getting as dividend compared to the share price! 🎨 Funny Example: Chintu buys 1 share of Popcorn Ltd. 🍿 at ₹200. Company gives ₹10 dividend per share. 👉 Dividend Yield = (₹10 ÷ ₹200) × 100 = 5% Means: Chintu is earning 5% every year just by holding this share — like interest from a savings account! 🏦💸 🤔 Why is Dividend Yield Important? ✔️ Shows how much passive income you can earn by just holding the share 📈 ✔️ Great for investors who love regular income — like retired uncle Sharmaji who wants safe, steady returns! 🧓👴 🔍 When High Dividend Yield is Good? ✅ Stable, mature companies giving regular dividends 🍀 ✅ No risk of company shutting down ✅ Perfect for “long-term investors” who want yearly income ⚠️ When High Dividend Yield is Dangerous? ❌ Sometimes a company’s share price falls badly due to problems 😨 ❌ Dividend looks high but company future may be weak 🚨 👉 Example: If price falls from ₹200 to ₹100 but dividend stays ₹10 — Yield becomes 10%! But why did price fall? Something fishy? 🐟 Always check the reason behind high dividend yield! 🎯 Low Dividend Yield? Not always bad! ✔️ Growing companies may pay low or no dividend 🚀 ✔️ They use profits to grow the business and increase share price (Capital Gains!) 👉 Like a young startup — keeps money to expand, not give dividends now! 📊 🏆 Quick Gyaan: ✔️ High Dividend Yield + Stable Business = Good for Passive Income! ✅ ✔️ Low Dividend Yield + Fast Growth = Good for Long-Term Wealth Creation! 🚀 🎈 Funny Tip: Dividend Yield is like a mango tree 🥭: ✔️ Some trees (companies) give sweet mangoes every year (dividends)! 🍯 ✔️ Some trees keep growing taller, but give fruits later (future profit)! 🌳 Pick what you like — fruits now or fruits later! 😂 🔑 In a Nutshell: ✔️ Dividend Yield = % return via dividends on your investment ✔️ High Yield = Regular Income (Check safety too!) ✔️ Low Yield = May be reinvesting profit for future growth 💡 "A smart investor knows when to enjoy sweet dividends — and when to wait for the big harvest later!" 🌾💸