Cute Fuzzy wuzzy Wellington question

[wallygator69]

Hi,

Thanks in advance for the help figured you would not need to burn many brain cells answering this, I know I'm missing something from old post of yours below on figuring income for Welington based on distributions paid out over a year.

$100k/31.17 equals 3208 shares of Wellington which today shows yield of 2.89%.

From Distributions at Vanguard during 2005

march .21 equals $673.00
june .21 equals $673.00
September .21 equals $673.00
December .28 equals $900.00
LT cap Gain .909 equals $2916.00
st Gain .065 equals $208

Total is $5863.00 for the year. How can this be right with yield of 2.89?

Thanks Wally

P.S. I don't want to see your breasts anymore.


Cute Fuzzy Bulldog
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Re: Portfolio questions
« Reply #23 on: May 09, 2005, 12:10:09 PM »

Loveslife...the dividend yield quoted by vanguard is for the stock and bond dividends...they'll break out the components for tax purposes for you at year end. They do not include capital gains. If you want to see what your investment would have earned last year, do this: take the amount you plan to invest and divide it by the current share price for wellington. Thats your # of shares. Go to vanguards web site, pick the list of funds, pick wellington, and click on distributions. That will tell you by quarter and year end for the last six quarters what the dividend and capital gains payouts were per share. Multiply those #'s by your number of shares, and you'll see what income you would have seen by quarter and at year end.

 

[cute fuzzy bunny]

I'd have to go look, but the short answer is that I think vanguard reports the 30 day SEC yield, not the past 365 days actual yield. Fluctuation of the NAV and current dividend payments may make one worth a good bit more than the other.

 

[ats5g]

Hi Wally,

The "yield" of the fund just represents the dividends from the stocks and bonds that fund holds. For example, Morningstar lists Wellington's yield as 2.80%. Here is their definition of yield:

Yield
Yield, expressed as a percentage, represents a fund’s income return on capital investment for the past 12 months. This figure refers only to interest distributions from fixed-income securities, dividends from stocks, and realized gains from currency transactions. Monies generated from the sale of securities or from options and futures transactions are considered capital gains, not income. Return of capital is also not considered income NMF--or No Meaningful Figure--appears in this space for those funds that do not properly label their distributions. We list N/A if a fund is less than one year old, in which case we cannot calculate yield.

Morningstar computes yield by dividing the sum of the fund’s income distributions for the past 12 months by the previous month’s NAV (adjusted upward for any capital gains distributed over the same time period).

If you take the dividends from the last year of $0.90 [0.20, 0.21, 0.21, & 0.28] and divide by the current NAV [31.18] you get roughly 2.89%. This yield matches what Vanguard has on their website, though they probaby calculate it slightly differently.

- Alec

 

[cute fuzzy bunny]

Vanguards description of wellingtons dividend percentage shown:

THIRTY DAY ADVERTISED YIELD NET OF EXPENSES CALCULATED MONTHLY AT MONTH-END

aka "the thirty day SEC yield".

 

[wallygator69]

Hi,

Great I got it. Cap gains aren't figured as part of yield.

Thanks for the clarification.

Wally