Comparison
A high yield on cost is not a current opportunity rate.
Historical cost does not represent what the capital is worth today. Current yield uses current price, while total return also includes price change and costs.
Dividend context
Yield on Cost Calculator
Compare annual dividend income with historical cost and with the holding's current market price.
Yield on cost—
Current dividend yield—
Current annual income—
Two different denominators
Original cost per share—
Current position value—
Value change before income and costs—
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Formulas
yield on cost = annual income ÷ original cost. current yield = annual dividend per share ÷ current share price.
Interpretation
Yield on cost is backward-looking.
It can show how income compares with the amount originally invested, but it does not measure the return available on today's market value or the holding's total return.
Source
Yield and total return answer different questions.
FINRA notes that dividend yield combines with capital gains or losses when measuring total return.