Yield Basis

The yield basis is a method of calculating the return on an investment. It is used to compare different investments and to make investment decisions. There are two main types of yield basis:

• Simple yield: This is the most basic type of yield basis. It is calculated by dividing the annual interest payment by the investment's purchase price.
• Compound yield: This is a more accurate type of yield basis. It takes into account the effect of compounding interest. Compound interest is the interest that is earned on the interest that has already been earned.

The yield basis is an important factor to consider when making investment decisions. It can help you to compare different investments and to make the best investment for your needs.

Here are some additional details about the yield basis:

• The yield basis is often expressed as a percentage.
• The yield basis can be used to compare investments with different maturities.
• The yield basis can be used to compare investments with different interest rates.

The yield basis is a valuable tool for investors. It can help you to make informed investment decisions and to achieve your financial goals.