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Jim Cramer: What Is a Safe Yield?

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Need some investing education?

Jim Cramer broke down what a safe yield is for investors who may not know. 

"Safe yield. It means that the cash flow, it's not the earnings, but the cash flow covers it. So Verizon has giant cash flow, so if you look at their yield it's completely safe. AT&T's a little more stretched. I think the yields okay. I don't like to stretch for yield, but you see Verizon, Dominion, they covered it big," he said. "American Electric Power covers it big, so you want to look at the cashflow and if you don't know how to look at cashflow, you've got to look at Stay Mad for Life."

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