What is a good dividend yield?
Editorial Staff, reviewed November 2, 2026
A good dividend yield is one above what you could get with less risk, on a payment that can last. On our data from Nov 3, 2026, the median US dividend stock yields 2.54%, an S&P 500 fund (SPY) yields 1.00%, and a fund of 0 to 3 month Treasury bills (SGOV) yields 3.73%.
Dividend yields today, by type of security
The middle half of each group sits between the two outer columns, so a stock at 4.71% is already in the top quarter of paying stocks.
| Type | Lowest quarter ends | Median | Top quarter starts |
|---|---|---|---|
| Stock | 1.23% | 2.54% | 4.71% |
| ETF | 1.03% | 2.54% | 4.74% |
| Closed-end fund | 7.18% | 8.93% | 11.70% |
| ADR | 2.41% | 4.03% | 5.88% |
| Preferred | 6.85% | 7.61% | 8.59% |
Compare against the yield you can get with no stock risk
The Treasury bill fund is the useful yardstick. A stock yielding less than 3.73% isn't paying you for its risk through income alone, so its case has to rest on growth. That is true of more than half of the paying stocks on our data, which is why a low yield isn't automatically a bad one. Schwab US Dividend Equity ETF, at 2.97%, has raised its regular payments 7.2% a year over five years on our record, so its income has grown where a bill fund's depends on interest rates.
How high is too high?
A very high yield can mean the market expects the payment to fall. We checked this on our own data, by counting how many US stocks in each yield band paid less over the last 12 months than the 12 before. In the 2% to 4% band, 5% did. Above 10%, 47% did.
| Yield today | Stocks | Payments fell in the last year |
|---|---|---|
| 0% to 2% | 663 | 5% |
| 2% to 4% | 522 | 5% |
| 4% to 6% | 202 | 10% |
| 6% to 10% | 127 | 17% |
| 10% and above | 129 | 47% |
This is one year of data, and it looks backward: some of these yields are high because the payment was already falling and the price fell further. It doesn't show that a high yield causes a cut. It does show that a high yield and a falling payment often travel together, so a high yield is a reason to read the record first.
Why fund yields need a different reading
Option-income funds can show yields above 50%, and some of that can be a return of your own capital, which the fund reports in box 3 of Form 1099-DIV and which lowers your cost basis. Trailing yield can also overstate things when payments are falling. Every ticker page shows trailing and recent rates side by side, and it tells you when they disagree.
How to check a yield yourself
- Work out the yield from the last 12 months of payments, or use the dividend yield calculator.
- Compare it with the median for its type in the table above.
- Open its ticker page and look at payment changes, since a cut says more than the yield does.
- Look at the share price over the same period, since a falling price lifts a yield without paying you anything.
Related dividend guides
This is general education and not tax or investment advice. Securities named here illustrate the arithmetic and are not suggestions. See the disclaimer.