Looking Beyond Dividends: How to Maximize Your Yield

When making investing decisions, considering shareholder yield, rather than only dividend yield, could improve your results.

The word dividends and an upward curve are drawn on a black chalkboard.
(Image credit: Getty Images)

Income investors love dividends. They own a portfolio of world-class businesses, sit back and let the cash roll into their accounts. Sounds great, right? It pretty much is.

But what if I told you there’s an even better way to invest? Instead of focusing purely on dividend yield, there is a broader metric that can improve your results that’s worthy of your attention: shareholder yield.

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StockDividend yield (+)Repurchase yield (+)Debt reduction yield (=)Shareholder yield
Alaska Air0%1.3%6.7%8.0%

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

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Michael Joseph, CFA
Portfolio Manager and Deputy Chief Investment Officer, SAM

Michael is a Portfolio Manager and Deputy Chief Investment Officer at SAM, a Registered Investment Advisor with the United States Securities and Exchange Commission. File number: 801-107061. He sources investment opportunities and conducts ongoing due diligence across SAM’s portfolios. Michael co-manages SAM’s Income and Tactical Select strategies. Prior to joining SAM, Michael worked with high-net-worth private clients for the largest independent wealth management firm in the United States. He was also a senior analyst for one of the largest investment-grade bond managers in America. Michael joined SAM in 2017.