Yield on Cost

     I have recently been trying to learn a little bit more about investing, as it seems to be something in life that truly does matter. With the economy changes that have been happening since the pandemic, I feel like a lot of the more useless parts of the world economy are going to start dying off, like nail salons and pizza restaurants. I think that people are headed toward a future where they will have to be willing to do more for themselves like cooking and cleaning. That being said, I still think there will always be a need for an economy, there will hopefully always be groceries available and homes to live in.

     The investing strategy I am currently Interested in is called dividend investing. That is where you own stock in a company andbit pays you a small share of its profits, usually this is just a few cents per share of stock. Not all companies pay out dividends, but some do. Theoretically, if you own a large variety of a lot of stocks you could be living off the dividends, assuming you are living cheaply.  

     Yield on cost is the ratio of how much it will pay you, the yield, for the cost of the stock. I found an amazing yield on cost calculator here. You just type in the ticker symbol and it tells you the yield on cost ratio per thr most recent dividend payout information.

     Before purchasing any stocks it is wise to learn about the company first, but this can be one great way to figure out how to work this investment strategy. Another way is to figure out what the funds at the large investment houses are buying sticks in and holding those individual stocks. Remember that you should have a broad and diverse investment strategy and not be heavily invested in just one sector like healthcare or oil.