The Dividend Rate is the total expected dividend payments from an investment, fund or portfolio expressed on an annualized basis plus any additional non-recurring dividends that an investor may receive during that period. The calculation of the dividend rate takes into account not only the declared dividends, but also any special cash distributions which are made outside of regular quarterly or monthly payouts.For example, a mutual fund may declare a $0.50 per share distribution in December, but also make a one-time special payment of $0.10 per share in January. In this case, the total expected annual dividend would be $0.60 ($0.50 + $0.10), and the 12-month dividend rate would be 5%.The advantage of using the annualized dividend rate is that it allows for easy comparison between investments with different payout frequencies (e.g., monthly vs annually). It can also help investors to anticipate how much income they will receive from their holdings over time.
