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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.
