Yield

Yield is the annual income return from an investment, expressed as a percentage of its cost, current value, or face value. It includes dividends, interest, or other income streams.

For example, a bond purchased at $1,000 with $50 annual interest has a 5% yield. In equities, yield reflects dividend income relative to stock price, guiding income-focused investment decisions.

Yield is a key metric for comparing investment returns, assessing risk, and optimizing portfolio allocation. Traders, investors, and analysts use yield to evaluate bonds, equities, and commodities with income potential.

Understanding yield allows participants to balance risk and reward, forecast cash flows, and make informed decisions about income-generating assets in diverse financial markets.