What Does Current Yield Mean?
Annual income (interest or dividends) divided by the current price of a security. This measure considers the current price of a bond instead of its face value and reflects the return an investor would expect if he or she purchased the bond and held it for one year; it is not an accurate measure of the actual return that an investor will receive in all cases because bond and stock prices change constantly as a result of market factors. Also referred to as bond yield or, in the case of stocks, dividend yield. Investopedia explains Current Yield As an example, if a bond is priced at $95.75 and has an annual coupon of $5.10, the current yield of the bond will be 5.33%. If the bond is a 10-year bond with 9 years remaining until maturity and you were planning to hold it for only 1 year, you would receive the $5.10, but your actual return would depend on the bond’s price when you sold it. If, during this period, interest rates rose and the price of the bond fell to $87.34, your actual return
