What term refers to the total return on an investment over a specific time period?

The term that refers to the total return on an investment over a specific time period is "rate of return." This metric provides a comprehensive overview of how well an investment has performed, expressed as a percentage of the initial investment amount. It encompasses not only capital gains (the increase in the value of the investment) but also any income generated, such as dividends or interest, over that period.

Understanding the rate of return is crucial for making informed investment decisions, as it allows investors to assess the performance of different investments on a standardized basis. It is a vital tool for comparing the efficiency and profitability of various investment options, thereby guiding financial planning and strategy.

While yield refers more specifically to the income generated by an investment, capital gains focus exclusively on the increase in the investment's value, and dividend yield looks only at the income generated from dividends relative to the stock price, none of these terms encapsulate the overall total return in the same way that the rate of return does.