Business Glossary

difference in yield between various issues of securities. In comparing bonds, it usually refers to issues of different credit quality since issues of the same maturity and quality would normally have the same yields, as with Treasury securities, for example. Yield spread also refers to the differential between dividend yield on stocks and the current yield on bonds. The comparison might be made, for example, between the standard & poor's index (of 500 stocks) dividend yield and the current yield of an index of corporate bonds. A significant difference in bond and stock yields, assuming similar quality, is known as a yield gap.

difference in yield between various issues of securities. In comparing bonds, it usually refers to issues of different credit qualities since issues of the same maturity and quality would normally have the same yields, as with U.S. Treasury securities, for example.