Vanguard Federal Money Mkt Acct Return

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Gatewood
Posts: 84
Joined: Tue Dec 01, 2015 4:30 pm

Vanguard Federal Money Mkt Acct Return

Post by Gatewood »

My settlement account -- Vanguard Federal Money Market (VMFXX) average annual return YTD is 1.1%. The Account's 30 Day SEC is 4.77%.

I would have thought the return and the yield would be much more aligned

I am obviously missing something here -- appreciate your help

Thanks in advance
stan1
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Joined: Mon Oct 08, 2007 4:35 pm

Re: Vanguard Federal Money Mkt Acct Return

Post by stan1 »

Gatewood wrote: Sat Apr 01, 2023 9:28 am My settlement account -- Vanguard Federal Money Market (VMFXX) average annual return YTD is 1.1%. The Account's 30 Day SEC is 4.77%.

I would have thought the return and the yield would be much more aligned

I am obviously missing something here -- appreciate your help

Thanks in advance
1.1% is YTD (3 months)
4.77% is annualized
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JoMoney
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Re: Vanguard Federal Money Mkt Acct Return

Post by JoMoney »

Also, money markets are very short-term accounts, and the interest rate is not fixed, especially not for an entire year.
Interest rates could rise or fall (perhaps quickly as it did last year) resulting in a very different annualized return than what the yield was at purchase.
"To achieve satisfactory investment results is easier than most people realize; to achieve superior results is harder than it looks." - Benjamin Graham
Geologist
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Re: Vanguard Federal Money Mkt Acct Return

Post by Geologist »

The money market's SEC yield isn't for 30 days but for 7 days. It is showing the very latest returns.

I'm not sure what you mean when you write "average annual return YTD". There can be a YTD return (that is, since Jan.1 2023) and an average annual return averaged over some period (usually longer than a year).
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ruralavalon
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Location: Illinois

Re: Vanguard Federal Money Mkt Acct Return

Post by ruralavalon »

Gatewood wrote: Sat Apr 01, 2023 9:28 am My settlement account -- Vanguard Federal Money Market (VMFXX) average annual return YTD is 1.1%. The Account's 30 Day SEC is 4.77%.

I would have thought the return and the yield would be much more aligned

I am obviously missing something here -- appreciate your help

Thanks in advance
YTD returns of 1.1% is the actual past return so far this year (90 days).

The 7 day SEC yield of 4.77% is "AVERAGE ANNUALIZED INCOME DIVIDEND OVER THE PAST 7 DAYS".

The yield changes rapidly with the rate changes from the Federal Reserve.
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link: Bogleheads® investment philosophy
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Chip Munk
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Re: Vanguard Federal Money Mkt Acct Return

Post by Chip Munk »

You can see the monthly distributions here: https://investor.vanguard.com/investmen ... tributions

Scroll down to "Dividend income and capital gains". The fund paid $0.003901/share for March, a distribution yield of 4.59% (annual rate).
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