What does the term 'yield' refer to in investment management?

The term 'yield' in investment management refers specifically to the income generated from an investment. This income can come in various forms, such as interest payments from bonds or dividends from stocks. Yield is typically expressed as a percentage of the investment's current price or its initial cost, providing a measure of the return on investment relative to its market value.

Yield is a key concept for investors as it helps them assess the income potential of their investments compared to their overall costs or appreciation. This understanding allows investors to make informed decisions about where to allocate their resources, balancing the desire for income (yield) with the potential for price appreciation.