SVIA

Glossary

All | A | B | C | D | E | F | G | I | L | M | N | O | P | Q | R | S | T | U | V | W | Y

Effective Annual Yield

The compound yield associated with a periodic interest rate based on the frequency of interest payments per year. As an example, if the annual interest rate is 3%, interest is credited semi-annually and the periodic interest rate is 1.5%, then the effective annual yield is 3.02%, calculated as follows:(1.015 x 1.015)-1= 3.02%. (See also crediting rate.)