DIGIVESTASI - Although the Jakarta Composite Index (JCI) shows a decline in early 2023, investors still have the opportunity to invest in defensive stocks that regularly pay out large dividends. Can investing with a focus on dividends this year increase your wealth?

As you know, apart from capital gains, stocks can also provide additional benefits in the form of dividends distributed by companies that record net profits.

High dividend stocks can be found in the IDX High Dividend 20 index, where overall, the net income of the 20 stocks in this index grew by 126% year on year (yoy).

To measure the potential return on dividends received, investors need to know the dividend yield. Here's how to calculate the dividend yield that you need to know.

The dividend yield formula is very simple. You just need to know the dividend per share (DPS) value announced by the issuer, then divide that value by the current share price.

For example, if the current share price is Rp 3,000 per share and the dps value is Rp 1,000, the dividend yield is:

Rp 1,000 ÷ Rp 3,000 = 33%

This means that your dividend yield is 33% of your total investment capital in the stock.

If you invest Rp 100 million, the dividend yield is Rp 100 million x 33% = Rp 33,000,000.

Thus, your investment loss can be covered by the dividend, although this depends on the amount of yield and investment capital when buying the stock.

Dividends have similar characteristics to deposits and government bond coupons, in that the funds will be transferred to the customer's fund account (RDN) on a predetermined date.

However, please note that dividends are subject to a final tax of 10% if not reinvested. To avoid tax, you can reinvest the dividend proceeds into investment instruments listed in Article 34 and Article 35 of PMK-18/PMK.03/2021, such as debt securities, sukuk, stocks, mutual funds, asset-backed securities, deposits, and other instruments.

If you are reinvesting dividends, make sure to accurately state the amount of money from the reinvested dividends.

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