What is yield?

Yield is the return an investment pays, written as a percentage of its price or face value. A bond’s coupon over its market price is current yield. The rate that discounts remaining cash flows back to today’s price is yield to maturity. The number moves when the price moves, even if the coupon does not.

How does yield work?

You compare what the instrument pays to what it costs. A 5 coupon on a 100 face that now trades at 95 has a current yield above 5 percent. Yield to maturity also counts the pull back to par and the timing of each payment.

Yield vs interest rate

An interest rate is the term you set on a loan or a deposit. Yield is what the market implies from the price of an existing instrument. They meet when a new loan is priced off the curve. They drift apart as soon as that loan’s price changes in the secondary market.

Yield vs yield management

Yield management is a pricing tactic for seats, rooms, and other perishable stock. It shares the word and nothing else. If you landed here from a hotel or airline context, that is the other page.

How it works with Blnk

Yield is a rate you compute in your app. The ledger records the interest that rate produces.

On a loan, the source is the loan balance and the destination is @InterestRevenue. The loan can go further negative. That is the charge. See the lending tutorial.

await blnk.Transactions.create({
  precise_amount: 500,
  precision: 100,
  reference: 'interest_20260816_001',
  currency: 'USD',
  source: 'loan_balance_id',
  destination: '@InterestRevenue',
  description: 'Daily interest charge',
  allow_overdraft: true,
  meta_data: {
    transaction_type: 'interest_charge',
    annual_yield: 0.05,
  },
});

On a deposit product the sides flip: source @InterestExpense and destination the customer wallet. Schedule the post if it should run on a clock. See scheduling.