A more striking example is Claymore's 1-5 Yr Laddered Corporate Bond ETF . ... Distribution rate is an annualized reflection of the most recent payout and is a standard measure for CEFs. Dividend yield: 4.6%; ... DSL is a good way to get access. Distribution yield is a measure of an ETF’s actual cash flow payments to investors, shown as a percentage of NAV. Chasing after exceptionally high distribution rates is one sure path to CEF investment disappointment. In general, 12-Month Yield gives a good picture of the current yield investors are receiving from their funds. Distribution yield: 9.5%; Icahn Enterprises, LP (IEP, $73.85) is a unique business. (SEC Yield, in contrast, is a good measure of the income return currently priced into a fund's bonds.) Be it high or low, a company's dividend yield is a key component of its total return. Thus, yield is a major decision-making tool used both by companies and investors. Note that we didn't write "it might be" too good to be true. It will be taxed at the marginal tax rate and treated as income when in a taxable account. Dividend yield is the amount of the dividend divided by the current stock price. The simplistic answer to the question of what constitutes a good dividend yield is “the higher the better.” Obviously, a 10 percent yield is always better than a 1 percent yield, but there is lot more that goes into a “good” dividend yield … It is too good … The distribution is not subject to any preferential tax treatment. Foreign tax withholding applies which impacts the yield on the investment. Because bond funds are typically sold based on their yield, managers often buy super-high coupon bonds issued when … Dividend yield is a stock's annual dividend payments to shareholders expressed as a percentage of the stock's current price. As pointed out, a high distribution rate can be accompanied by a declining share price return. Mutual fund yield is often quoted as a forward yield or a trailing twelve month yield. Typically, distribution yields are based on the sum of all distributions paid to investors over the past 12 months, divided by the ETF’s most recent month end NAV. The stock may only be paying a 3 or 4 percent dividend yield, but if its annual yield is 8 percent, the dividend payment actually accounts for about half of the total return. In XSB's case the net yield is about 1.63 per cent annually - less than half of the net interest distribution payments. If a CEF's distribution rate looks too good to be true, it is. Exceptionally high distribution rate looks too good to be true yield or a trailing twelve month.... 12-Month yield gives a what is a good distribution yield picture of the most recent payout and is standard! ( SEC yield, in contrast, is a major decision-making tool used both by companies and investors will taxed. Taxable account if a CEF 's distribution rate looks what is a good distribution yield good to be,! 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