Yield Definition

In finances, the yield is a percentage that measures the rate of return on an investment. For stocks or other items that fluctuate in value, the yield typically does not include the cost or profit associated with market fluctuations, though the yield would include any dividends paid or interest earned.

The term yield is often used in a variety of specific ways to mean quite precise things, but the underlying concept is the return on investment. For example, stocks are commonly stated to have two different yields-the cost yield and the current yield; while bonds are commonly often stated to have four different yields-coupon, current, yield to maturity, and possibly a tax-equivalent yield.