Yield Pickup

You own a bond that pays 3% a year. You bought it for $100. Your buddy has a bond that he bought for $100 that pays a 4% interest. Given that you have, um...yield envy...you want in on that action, and the extra 1% on your money.

So you sell your bond, and you buy the same bond that your friend has. That extra 1% is called “yield pickup.” You’re just selling a bond with a lower yield and purchasing a different bond with a higher yield.

Now go find yourself a friend who doesn't brag about his bond yields.