Business and Personal Finance Dictionary

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• CURRENT YIELD
  
  Expressed as a percentage, current yield is a measure of your actual rate of return on an investment. If you own a bond, current yield is calculated by dividing the coupon rate by the purchase price and multiplying by 1,000. For example, if you paid $800 for a bond with a coupon rate of 10%, the current yield is 12.5%. If you paid $1,200, the current yield would be 8.33%. And if you paid par, or $1,000, the current yield would be 10%, the same as the coupon rate. If you own a stock, the current yield is the annual dividend divided by its market price. CURRENT YIELD: BONDS Coupon rate / Purchase price x 1,000 = Bond Current Yield CURRENT YIELD: STOCKS Annual dividend / Market price x = Stock Current Yield
  
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