Yield
Yield is the income-only return on an investment over a set period of time. Usually stated as a percentage of the original investment, the calculation for yield is as follows:
Yield = Net Realized Return / Principal Amount
This cash flow measure applies to fixed-income securities, common stocks, preferred stocks, and convertible stocks and bonds. It also pertains to annuities and real estate investments.
Zero-Coupon Bond
A zero-coupon bond is a debt security that pays no interest during the term of the loan. Instead, these accrual bonds, which trade at a deep discount, offer full face value profits at maturity.