Definition of "Dividend yield fund"
A dividend yield fund invests in shares of companies having high dividend yields. Dividend yield is defined as dividend per share dividend by the shareâ€™s market price. Most of these funds invest in stocks of companies having a dividend yield higher than the dividend yield of a particular index, i.e., Sensex or Nifty. The prices of dividend yielding stocks are generally less volatile than growth stocks. Besides, they also offer the potential to appreciate.