Returns on investment is made up of the dividend income paid out by the company which can be represented by the dividend yield and the capital appreciation over time.
But dividends are not the only way companies can return capital to investors. Recently the trend has been companies using share buybacks as a way for capital return to investors. Companies prefer this over increasing the dividend because dividend payouts are seen as being sticky and once the amount per share is increased in good times, it is very hard for it to be reduced in the future. This concept pretty much applies mostly to the equities and real estate investments like REITs.
Company share prices are overly punished when the dividends are cut. Buybacks provide a simple on and off switch option for companies to return capital when it is available and change gears as business condition changes.
Since share buybacks is a form of capital return, it should also be incorporated in the calculation of the total return for shareholders. Hence the concept of shareholder yield is the sum of capital return in the form of dividends and the amount the shares the company bought back.
Academic research shows dividends make up a large portion of investors return and by expanding that to include buybacks captures the whole investment return picture.
In addition to dividend exchange traded funds with strategies which invests in companies with high dividend yields compared to the market. ETF providers have also capitalized on this trend by creating exchange traded funds such as ZYAU only invest in 40 stocks with the highest shareholder yield holder yield.