SEC yield

SEC Yield

The yield on a bond fund calculated by a formula issued by the SEC. The SEC yield is calculated by taking the interest each share in the fund earns for a 30 day period and subtracting all expenses and sales charges the fund's managers assess. Each bond fund in the United States must publish its SEC yield. The SEC yield is used to compare the yields on different bond funds. It is also called the standardized yield.

SEC yield.

SEC yield is the yield that a bond mutual fund must disclose in its advertising and other documents according to Securities and Exchange Commission (SEC) rules.

The rather complex calculation reports the annualized current net market yield, or the actual interest earned per share after fund expenses and any sales charges are subtracted, divided by the cost per share. The formula excludes any capital gains the fund may have realized.

SEC yield creates a level playing field for comparing bond fund investments because the amount you would have received in income distributions from each of the funds over a specific period is figured in the same way. This formula can't accurately predict future yields, though, in part because a bond fund portfolio typically changes all the time.

Money market funds must also report SEC yield, though the formula for that calculation is much simpler. In this case, it's what a fund would yield if it paid at the same rate over a full year what it paid in the previous month.

References in periodicals archive ?
We discount the value of the SEC yield because very few of the securities in the fund will be held to maturity.
The fund charges a low expense ratio of 15 basis points while the SEC yield is attractive at 2.
Since its launch, EMLC has paid monthly dividends and as of July 29, 2011 had a 30-day SEC yield of 6.
For further information related to the Guggenheim BulletShares ETFs, including SEC yield, distribution rate and yield-to-maturity information, please visit www.