Calculate the 30-day SEC yield for a money market fund based on its current net asset value and expense ratio.
Learn how to use the 30 day SEC yield calculator and its working principles
The 30-day SEC yield is a standardized measure of a money market fund's return over a 30-day period. It's expressed as an annual percentage rate and is required to be disclosed by publicly-traded money market funds in the United States. The SEC yield provides investors with a way to compare the performance of different money market funds.
The SEC yield is a measure of return based on historical performance and does not guarantee future results. It does not account for taxes, fees, or other investment costs. Additionally, money market funds are designed to be low-risk investments, but they are not FDIC insured and may still lose value.
Suppose a money market fund has a NAV of $1,000,000 and generates $5,250 in daily income over 30 days:
Calculation:
SEC Yield = (365 × $5,250) ÷ ($1,000,000 × 30) = 0.064125 or 6.4125%