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The Short Answer

What's a Benchmark? Or Buyback? Or Moat?

Readers said they were unclear on what certain financial jargon means, so we're providing a few more definitions.

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A recent Short Answer column explained some commonly used but occasionally misunderstood financial jargon, and at the end we asked users to submit their own nominations for the list. We received lots of great suggestions, and this week we take on some of these reader-submitted items. So here we go:

Annual dividend/yield: The amount of a security's income that is distributed to its shareholders during the course of a year. Some stocks pay shareholders a portion of company profits in the form of dividends while bond shareholders typically receive interest payments. Both may be referred to as the investment's yield. (On's mutual fund and exchange-traded fund quote pages, this is represented by the "TTM Yield" metric, which stands for trailing 12-month yield. A 30-day SEC yield is also included for funds and ETFs, and you can read about how to use these two yield measures here. Yields at the top of stock quote pages also are TTM.) To calculate a security's annual yield, simply divide the amount of income paid out to investors during the past year by its share price.

Adam Zoll does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.