Deterministic calculation
How to calculate cash yield on a private investment
Simple cash yield equals cash distributions received divided by capital invested, expressed as a percentage.
What the ratio does—and does not—say
If $50,000 was invested and $4,000 in cash was received over the period being measured, simple cash yield is 8%. It does not include unrealized value changes, taxes, fees not already deducted, return of capital classification, time-weighting, or risk. It is not the same as IRR or total return.
Label the period and source
A meaningful record states whether distributions cover one year, the life of the investment, or another period. Verify both the capital denominator and cash numerator against original records. If either is unknown, the result should remain unknown.