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Hi DeltaOne81,

I think you are correct as far as I understand things. I am curious if you could post the distributions from the VBISX fund for the past 12 months from your statement - or at least confirm that the distributions you receive match the distributions listed on Vanguards website (I couldn't match them up yesterday from your post in January).

I had a post going yesterday but got sidetracked. However basically Vanguards lack of disclosure about how the different yields are actually calculated (read state the formula) its difficult to determine what we are looking at.

For instance Morningstar's yield (TTM) for VBISX is 3.81%. Going on to Vanguard's website and adding up the past 12 distributions and dividing by the NAV at the last distribution matched. This seems to be the correct term for distribution yield which is a modified current yield method to account for monthly distributions over an annual cycle.

Now Vanguard lists the distribution yield at 4.17% (without double checking) which doesn't match up. Now if you take what I believe the 30-day current yield then we are getting close. The 30-Day yield is similar to calculation of the distribution yield but annualizes only the past 30 days of distributions. Now I believe what I call the 30-day current yield matches with what Vanguard calls the distribution yield. The 30-day current yield and distribution yield are similar because they still only reflect distributions (coupon payments).

If I am on track which is questionable then we have left to isolate is Vanguards formula for the yield calculaton. Now there is no statement about how this is calculated and the definition in its glossary is to vague. There is no specific reference to the 30-day SEC yield (which I might have missed). However if you check the holding's tab the funds yield to maturity matches with the yield listed on the distributions tab. So I am going to assume/assign the yield on the distributions tab some type of yield to maturity calculation. Unfortunately I think we have to know more information than published to calculate/verify this yield. Lastly we know that the 30-day SEC yield is an attempt to create a yield to maturity number which incorporates the price of the bonds (which as I said I agree with what you are saying).

So again if we could verify the distributions on the website with the distributions with an actual investor would help.


PS: Then I think looking at the NAV is next.
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