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FIDELITY MUNICIPAL MONEY MARKET (FTEXX) has a 7-Day Yield of 0.01%. I was wondering what 7-Day Yield means and how it is calculated.

I am also wondering if it would be better to buy a T-bill with Discount Rate of 0.1% or buy some Fidelity money market funds? How can I compare them? Any suggestions?

Thanks and regards!

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Here is an excellent article on the 7-Day yield and how to calculate the interest you would receive.

So if you invested $1000 for 30 days: (0.0001 * $1000) / 365 ~= $0.000274 per day. Multiply by 30 days to yield $0.008 in interest.

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  • The linked article is not entirely correct. The 7 day yield is calculated using the price difference over the seven day period plus any distributions incurred. How is this different from interest, one might ask. Well, it could very well be that a fund has more securities maturing over one 7-day period than the other, in which case the 7-day yield will no longer be a meaningful indicator of a fund’s performance if calculated with the interest incurred. Oct 9 '19 at 1:21

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