Yield (finance)

Yield is like the amount of candy you get after you trade your toy with your friend.

In finance, yield is the amount of money you make on an investment. It’s like how much candy you get back after you loan someone some of your candy.

When you make an investment, like buying a stock or bond, you are lending money to a company or government. They promise to pay you back with interest. The amount of interest they pay you is your yield.

Just like how your friend might try to give you back less candy than you gave them, sometimes companies or governments might not pay back as much as they promised, and your yield could end up being lower than you expected.

So, before you make an investment, it’s important to understand what the yield is and if it’s worth the risk.