Suppose you bought a $100 share a month ago. It paid a dividend of $1 today and then you sold it for $100. What was your dividend yield and capital gains yield on the investment?

Question

Quizplus · Accepted Answer

The dividend yield is calculated as the dividend received divided by the price paid for the stock, which is $1/$100 = 1%. The capital gains yield is calculated as the change in price divided by the initial price. Since the stock was bought and sold at the same price ($100), the capital gains yield is 0%.

Suppose You Bought a $100 Share a Month Ago