One way to narrow down your choice of shares is by looking at key financial ratios. Your broking platform will probably provide a variety of ratios for each company. Or jump onto the ASX website (www2.asx.com.au), which shows the main ratios for each listed company.
1. Dividend yield: This tells you the percentage of a company’s share price that it pays out in dividends each year. It can be a way to compare different companies, as well as comparing ongoing returns on shares to other investments. To work out the dividend yield, divide the annual dividend per share by the share price. Let’s say Company XYZ paid an annual dividend of 50 cents per share, and its shares are trading at $10, the dividend yield would be 5% ($0.50 ÷…
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The Australian Women's Weekly (Digital) - 1 Issue, April 2022