November 22, 2009

Current Roth IRA Dividend Yield

I added up the expected annual dividends on the holdings in my Roth IRA and based the current market value of the account the total dividend yield is about 3.6%. If I figure the current yield based on what I paid for the stocks is 5.8%.

The account has gone up about 31% in the past year. As the current market price of an equity goes up the yield % rate gets lower. If you buy a stock at $10 with a $1 dividend then its yielding 10%, but if that stock then goes up to $20 the yield is now only 5%. Of course on the other hand if the stock goes down then the dividend yield goes up.

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