Income yields: a guide to what they really tell us

Investors seeking natural income often compare equities and bonds, but headline yields can be misleading.

While dividend yield provides a simple snapshot for equities, bond yields are more complex, incorporating factors like price fluctuations and the ‘pull to par’ effect.

Compiled by our expert Investment Team, this whitepaper explores:

• the key differences between dividend yield, current yield, and yield to maturity (YTM);

• how bond price movements and the ‘pull to par’ effect influence income returns over time; and

• how AJ Bell approaches managing income-focused funds and portfolios.