Yield in Finance

Yield in finance refers to the earnings generated and realized on an investment over a particular period, expressed as a percentage of the investment’s cost, current market value, or Face Value. It can include interest, dividends, or other income. For example, if you invest $1,000 in a bond that pays $50 in interest annually, the yield would be 5% ($50/$1,000). In Stocks, if a company pays a dividend of $2 per Share on a Stock priced at $40, the yield would be 5% ($2/$40). Cases of yield include bond yields, Dividend Yields, and real estate yields.