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Bonds

Real Yield

Bond yield after subtracting expected inflation — the "true" return.

In depth

Real yields determine the cost of capital and the discount rate for risk assets. Negative real yields (post-2020 era) supported asset bubbles; rising real yields in 2022-23 crushed long-duration assets. The 10-year TIPS yield is the most-watched real yield benchmark.

Frequently asked about Real Yield

What is Real Yield?

Bond yield after subtracting expected inflation — the "true" return. Real yields determine the cost of capital and the discount rate for risk assets. Negative real yields (post-2020 era) supported asset bubbles; rising real yields in 2022-23 crushed long-duration assets. The 10-year TIPS yield is the most-watched real yield benchmark.

Why does Real Yield matter for investors?

In bonds, Real Yield is one of the building blocks investors use to compare opportunities and assess risk. Understanding it helps you read research notes, earnings reports, and market commentary without getting lost in jargon.

How is Real Yield used in practice?

Real yields determine the cost of capital and the discount rate for risk assets. Negative real yields (post-2020 era) supported asset bubbles; rising real yields in 2022-23 crushed long-duration assets.

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