Yield on cost
Yield on cost divides the annual dividend a position is expected to pay by the amount you originally paid for it. If a holding bought at forty euros a share now pays two euros, its yield on cost is five percent, whatever the share currently trades at. The dividend yield uses today's price in the same place, which is why the two numbers drift apart the longer a position is held.
Why it matters
The number is a record of how one position has developed since you bought it, and on a holding kept for a decade through several dividend raises it can grow to something that looks remarkable. It is worth being clear about what that means. A high yield on cost is a fact about a purchase made in the past, and it says nothing about what the same shares would return to money invested today, because the price has moved since. Reading it beside the current yield keeps the two questions apart.
How BullBenchmark shows it
We keep both halves of the ratio on the same page: the average cost we derived from your transactions, and the income your current holdings are expected to produce over the next twelve months. Because the cost side comes from your own export rather than a price you typed in, the figure follows every later purchase in the same position automatically. Both numbers sit next to each other on the demo portfolio.
Related terms
Dividend yield · Cost basis · Projected dividend income
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