What is yeld?

Yield refers to the percentage return or income generated by an investment over a certain period of time. In financial terms, yield generally means the total amount of return an investor can expect to receive on a security or investment, such as stocks, bonds, or real estate. Yield is usually calculated as a percentage of the amount of capital invested or the current market value of the investment.

The two most common measures of yield are the current yield and the yield-to-maturity. Current yield is calculated by dividing the annual income generated by an investment by its current market value. Yield-to-maturity is a more comprehensive measure of yield as it takes into consideration the present value of future cash flows, including interest payments and principal repayment, and assumes that the investor holds the bond until it matures.

The concept of yield is important to investors as it allows them to compare the returns of different investments and make informed decisions on where to allocate their capital. High-yield investments generally offer greater returns but also carry higher risks. Low-yield investments, on the other hand, may offer lower returns but are typically less risky.