Financial Quotient

What is yield?

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The yield is the income portion of an investment's return, which includes the interest or dividends received from holding securities, such as bonds and stocks.

It is shown as a percentage of the annual income return over the investment's cost or current market value. The yield and the price of a security share an inverse relationship - the yield will drop when the price of a stock or bond increases.

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A version of this article appeared in the print edition of The Sunday Times on October 28, 2018, with the headline What is yield?. Subscribe