7 Day Yield: Definition and Formula
The 7-day yield is a standardized way of expressing the income a fund generated over its most recent seven-day period, restated as an annual rate. It was created for money market funds, where the underlying holdings are short-dated instruments whose income changes constantly with prevailing interest rates. Rather than quoting a trailing twelve-month figure that could be months out of date, the 7-day yield answers a narrower and more useful question: if the fund kept earning at the rate it earned last week, what would that be worth over a full year?
The calculation is straightforward. Take the income distributed per share over the seven-day window, subtract fund expenses accrued in that window, divide by the share price (or NAV) at the start of the period, then multiply by 365 and divide by 7 to annualize. In formula form: ((income per share − expenses per share) ÷ starting NAV) × (365 ÷ 7). A fund that paid $0.0019 per share on a $1.00 NAV over seven days is running at roughly a 9.9% annualized rate. Some providers publish a compounded variant, the 7-day effective yield, which assumes each week's income is reinvested and therefore prints slightly higher than the simple figure.
The 7-day yield is not the same thing as the SEC yield. The 30-day SEC yield uses a longer window and a prescribed formula built around accrued interest income net of expenses, which makes it more comparable across bond and money market funds but slower to react. The 7-day figure is more current and more volatile. Neither is a distribution yield: distribution yield extrapolates the cash actually paid, which for an option-income ETF can include return of capital and short-term gains that are not interest income at all.
For weekly-paying dividend ETFs, the concept transfers but the label usually does not. Covered-call and option-income funds distribute the option premium they collect each week, so their most recent weekly distribution annualized over 52 weeks plays the same role a 7-day yield plays for a money market fund: a current-conditions snapshot. That is exactly how WeeklyYield computes the annualized yield you see on every fund page — most recent weekly distribution × 52 ÷ current price. Treat it as a run rate, not a forecast, because option premium expands and contracts with implied volatility, and a rich week can be followed by a thin one.
The practical takeaway: use a 7-day or weekly annualized figure when you want to know what a fund is paying right now, use the 30-day SEC yield when comparing interest-bearing funds on a level playing field, and use total return when you want to know whether you actually made money.
7-Day Yield Calculator
Enter one week of per-share income, per-share expenses accrued in that week, and the NAV at the start of the period.
Educational tool only. Figures are a run rate based on one week of income, not a forecast.
Frequently asked questions
The 7-day SEC yield is a money market fund's income over the last seven days, net of expenses, annualized using a formula standardized by the SEC so funds can be compared consistently. It excludes realized capital gains.
Divide net income per share over the last seven days by the starting NAV, then multiply by 365/7 to annualize. Example: $0.0019 income on a $1.00 NAV equals roughly 9.9% annualized.
It takes one week of actual earnings and projects them forward for a year. Because it uses only the latest week, it reacts quickly to changing rates or option premium but can move sharply week to week.
No. A 7-day yield is a projection based on one week of income; an annual or trailing-twelve-month yield reflects income that has already been paid over a full year. The two can differ substantially.
The simple 7-day yield annualizes one week of net income without compounding. The 7-day effective yield assumes each week's income is reinvested and compounds, so it prints slightly higher than the simple figure for the same underlying income.
It tells you what a fund is paying right now, not whether you will make money. For money market funds a high 7-day yield reflects prevailing short-term rates. For option-income ETFs it reflects high implied volatility, which is often paired with share-price erosion, so read it alongside total return.
Generally no — the label is a money market convention. The equivalent figure for a weekly payer is its most recent weekly distribution annualized over 52 weeks, which is exactly how the annualized yield on every WeeklyYield fund page is calculated.