30 Day Yield Calculator

30-Day Yield Calculator

function calculate30DayYield() { var netInvestmentIncome = parseFloat(document.getElementById('netInvestmentIncome').value); var averageDailyNetAssets = parseFloat(document.getElementById('averageDailyNetAssets').value); var yieldResultDiv = document.getElementById('yieldResult'); if (isNaN(netInvestmentIncome) || isNaN(averageDailyNetAssets) || netInvestmentIncome < 0 || averageDailyNetAssets <= 0) { yieldResultDiv.innerHTML = "Please enter valid positive numbers for all fields. Average Daily Net Assets must be greater than zero."; return; } // Formula: (Net Investment Income / Average Daily Net Assets) * (365 / 30) * 100 // This annualizes the 30-day income and expresses it as a percentage. var annualized30DayYield = (netInvestmentIncome / averageDailyNetAssets) * (365 / 30) * 100; yieldResultDiv.innerHTML = "Annualized 30-Day Yield: " + annualized30DayYield.toFixed(2) + "%"; }

Understanding the 30-Day Yield

The 30-Day Yield, often referred to as the SEC Yield for money market funds and bond funds, is a standardized measure designed to reflect the income generated by an investment over a recent 30-day period, annualized. It provides investors with a snapshot of the fund's current income-generating capability, making it easier to compare different income-producing investments.

What Does It Represent?

Unlike a simple dividend yield, which might only consider the last distribution, the 30-Day Yield attempts to smooth out short-term fluctuations by looking at a full month's performance. It takes into account the fund's net investment income (interest and dividends earned minus expenses) relative to its average daily net assets over that 30-day period. The result is then annualized to give an estimated yearly return based on that 30-day performance.

Why is it Important?

• Comparison Tool: It allows investors to compare the income potential of various money market funds, bond funds, and other income-focused investments on a level playing field.
• Current Income Indicator: It offers a more up-to-date view of a fund's income generation than historical yields, which might be based on older data.
• Transparency: For regulated funds, the calculation method is often standardized (like the SEC Yield), ensuring consistency across different providers.

How to Use the Calculator

Our 30-Day Yield Calculator simplifies this process for you. You'll need two key pieces of information, typically found in a fund's financial reports or fact sheets:

1. Net Investment Income (30 Days): This is the total income (e.g., interest, dividends) earned by the investment over the specific 30-day period, after deducting any operating expenses.
2. Average Daily Net Assets (30 Days): This represents the average total value of the investment's assets (minus liabilities) over the same 30-day period.

Input these values into the calculator, and it will instantly provide you with the annualized 30-Day Yield percentage.

Example Scenarios:

Example 1: Money Market Fund

• Net Investment Income (30 Days): $1,200
• Average Daily Net Assets (30 Days): $1,000,000
• Calculation: ($1,200 / $1,000,000) * (365 / 30) * 100 = 1.46%
• Result: The annualized 30-Day Yield is 1.46%.

Example 2: Short-Term Bond Fund

• Net Investment Income (30 Days): $4,500
• Average Daily Net Assets (30 Days): $2,500,000
• Calculation: ($4,500 / $2,500,000) * (365 / 30) * 100 = 2.19%
• Result: The annualized 30-Day Yield is 2.19%.

Important Considerations:

While the 30-Day Yield is a valuable metric, it's important to remember that it is a historical measure. Past performance does not guarantee future results. Market conditions, interest rates, and fund holdings can change, impacting future income generation. Always consider other factors like expense ratios, credit quality, and overall investment objectives when making investment decisions.