SEC yield

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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.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

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.

Dictionary of Financial Terms. Copyright © 2008 Lightbulb Press, Inc. All Rights Reserved.
References in periodicals archive ?
" There is significant scope for the government to cut interest rate on small saving schemes as both the G- sec yields as well as the interest rate on fixed deposits have fallen around 2 per cent in the past two years.
10, 2016, letter to the editor ('Health sec yields to Congress blackmail') I alleged that current Health Secretary Paulyn Ubial was against the use of the dengue vaccine Dengvaxia, a product of Sanofi, a French multinational, but she was forced to endorse it by the House appropriations committee with the threat of a reduced budget.
He suggests that investors have the option of choosing from higher-yielding products like the Market Vectors Intermediate Municipal Bond Index ETF (ITM), or the Market Vectors High-Yield Municipal Bond Index ETF (HYD), which currently provide 30-day SEC yields of 3.38 percent and 5.79 percent, respectively.
Sanofi Pasteur wishes to clarify and correct recent misleading comments on the dengue vaccine's safety and the process of obtaining its license in the Philippines ('Health sec yields to Congress blackmail,' Letters, 12/10/16).
" Since we do not see any spectacular change in the g- sec yields, an investor could expect returns of nie to 10 per cent from income and gilt funds," says Nagarajan.