U.S. Markets closed

How Yield Differs From Income

John Rekenthaler (john.rekenthaler@morningstar.com)

This column addresses a venerable subject: How payouts from investments are measured. Typically, such payouts are thought of as yield: the cash that securities currently generate. A successful purchase may increase its payouts over time, while an exceedingly poor one will default, thereby ceasing to produce any payments.