Distribution Yield
Definition of 'Distribution Yield'The amount of cash flow received or paid out by an annuity, REIT or other similar income paying instrument. The distribution yield of a security is calculated by dividing the distributions paid (yearly, monthly, etc.) by its cost or net asset value. Distribution yield can be used as a measure of investment cash flow provided by an investment relative to the cost paid for that investment. |
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Investopedia explains 'Distribution Yield'For instance, a REIT trading at an average annual price of $20 per unit which distributed $5 in distributions to unit holders would thus have a distribution yield of 0.25, or 25%. A REIT, annuity or fund with a higher yield with the same or similar cost of contract or ownership would then be considered, on the basis of cash flow only, a superior investment. |
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