# Average Start Yield

The 22 Dividends app calculates the average start yield of each of your open stock positions.

In this article we describe how the number is calculated.

The calculation is based on a weighted average and works as follows:

### 1. Initial Buy

Initially, you don’t have shares of a company.

**Example**: Assuming you buy 10.0 shares of stock XXX for $100.0 USD each. The current annual dividend is $2.0 USD per share.

**Start yield**: $2.00 USD / $100.0 USD = 2.0% per year

So, we own 10.0 shares which yield 2.0% per year:

Shares (weight) | Avg. Start YOC |

10.0 | 2.0% |

### 2. **Buy Transaction**

After one month passed you decide to buy 5 more shares for $110.0 USD each.

We assume the dividend per share has not changed.

**Start yield**: $2.00 USD / $110.0 USD = 1.81% per year

Shares (weight) | Avg. Start YOC |

10.0 | 2.0% |

5.0 | 1.81% |

Now, we compute the weighted average to compute the average start yield of our position of 15 shares:

(10.0 * 2.0% + 5.0 * 1.81%) / (10.0 + 5.0) = 1.94%

So, our 15 shares have a combined YOC of 1.94% per year:

Shares (weight) | Avg. Start YOC |

15.0 | 1.94% |

### 3. **Sell Transaction**

After another month you decide to sell 10.0 shares.

The selling does not affect the average start yield of your remaining 5.0 shares.

It just reduces the weight:

Shares (weight) | Avg. Start YOC |

5.0 | 1.94% |