Re: Investing 101 Question
Are you talking about bond funds?
If so, the yield - usually 30 day SEC yield reflects the income the bond fund should throw off today (this month) stated in annual terms. But the yield can change from month to month depending interest rate conditions.
The YTD includes the capital gain or loss of the fund as well as the amount of income the fund generated since Jan 1. A fund might be yielding around 5%, but also have several % capital loss due to a rise in interest rates. YTD reflects all this. The capital gain/loss of a fund is a reflection of the duration of the fund (is it short-term, intermediate, long, etc.), and the class of credit held by the fund (commercial paper, government bond, junk/high-yield, foreign).
Personally, I tend to look more at current yield of a bond fund than YTD, but YTD also reflects how a bond fund performance has been impacted by changes in interest rates, and changes in credit spreads. I only compare bond funds with the same general duration and same general types of bond held.
Audrey
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Retired since summer 1999.
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