Weighted Yield
Compare value-weighted against simple average yield to expose concentration.
Introduction
Who this is for: Portfolio investors reporting blended performance.
Why it matters: A simple average of yields treats a £1m asset the same as a £100k one. The weighted figure is the only honest portfolio yield, and the gap between the two tells you how concentrated the portfolio is.
Typical scenario: An investor with four assets of very different sizes reporting portfolio performance.
- Reporting the simple average because it usually looks better.
- Weighting by cost rather than current value.
- Ignoring that one large low-yielding asset dominates the blend.
Inputs
Assets
Analysis
Across 4 assets worth £1,940,000 producing £117,660, the weighted yield is 6.06% against a simple average of 7.40%. The largest asset represents 62% of value.
This analysis provides context, not financial advice. Consult a qualified adviser before making investment decisions.
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Live Results
Weighted Yield
6.06%
Simple Average
7.40%
Difference
1.34%
Total Value
£1,940,000