As an avid motley fool member I've been exposed to their investing rhetoric. One of these points is the Rule Breakers and Rule Makers (Audio CD) duopoly of thinking. In it they examine two kinds of companies .. the Rule Makers who are the 800 pound gorillas of their individual market niches and govern how that section of the market operates ... and the Rule Breakers who go in and disrupt existing markets with new ways and business models.
Since the cut in taxes on dividends by the Bush Administration (part of his bad tax breaks for the rich strategy to get re-elected), dividend-paying stocks have been getting more attention. One of the measures, yield seems so simple but leads to confusion.
Yield is basically the return you get from an investment, as a percentage, or:
yield = (income / price) * 100
The mathematics are simple enough, but there are several ways of interpreting this, and therein lies the rub. Even experienced investors get it confused, such as this Motley Fool article How to Achieve 20% Yields.