Gross Yield
Asset-Backed Securities glossary · Collateral & Cash Flow Modeling
Definition
Total interest and fee income as a percentage of receivables, before any deductions.
Gross Yield in plain English
Gross yield is the total money a pool of loans earns — all the interest plus fees the borrowers pay — written as a percentage of the loans outstanding, before you subtract any costs. 'Receivables' just means the money owed to you by borrowers. It's called 'gross' because nothing has been taken out yet: not the losses from people who don't pay, not the cost of the money you borrowed to fund the loans. If a credit-card pool with $1,000 of balances earns $200 a year in interest and fees, that's a 20% gross yield — a starting number you then shave down to find the real profit.
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