Annual percentage yield is the amount you earn on an interest-bearing investment in a year, expressed as a percentage. For example, if you earn $60 on a $1, 000 certificate of deposit (CD) between January 1 and December 31, your APY is 6%. When the APY is the same as the interest rate that is being paid on an investment, you are earning simple interest. But when the APY is higher than the interest rate, the interest is being compounded, which means you are earning interest on your accumulating interest.
Barry Goldsmith
| APA | Barry Goldsmith. (2010). Annual percentage yield (APY). Retrieved September 26, 2026, from http://smartdefine.org/annual_percentage_yield_(apy)/definitions/1147654 |
| Chicago | Barry Goldsmith. 2010. "Annual percentage yield (APY)" http://smartdefine.org/annual_percentage_yield_(apy)/definitions/1147654 (accessed September 26, 2026). |
| Harvard | Barry Goldsmith 2010, Annual percentage yield (APY), Smart Define, viewed 26 September, 2026, <http://smartdefine.org/annual_percentage_yield_(apy)/definitions/1147654>. |
| MLA | Barry Goldsmith. "Annual percentage yield (APY)" 21 October 2010. Web. 26 September 2026. <http://smartdefine.org/annual_percentage_yield_(apy)/definitions/1147654> |