Last updated: January 19, 2026
Yield on cost (YOC) measures dividend return based on what you actually paid, not the current market price. It shows how your income compares to your investment.
As dividends grow while your cost basis stays fixed, YOC can become quite high. Long-term dividend growth investors often see double-digit YOC.
YOC is useful for evaluating your personal return but not for comparing investments at current prices.
Understanding yield on cost helps you make better investment decisions and plan for taxes. Use our dividend calculator to see how it applies to your situation.
(Current annual dividend ÷ your original purchase price) × 100. If you paid $50 and now receive $4/year, YOC is 8%.
Shows your actual income return on invested capital. As dividends grow over time, your YOC increases even if stock price doesn't change.
Yes! If you held a dividend grower for decades with strong dividend increases, YOC can surpass 100%, meaning annual dividends exceed initial investment.
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