I'm a little confused over how to interpret the SEC yield for an index fund that has a large fraction (>45%) of its shares in bonds. I read that typically the yield will approach the SEC yield as a bond nears maturity but if this is a fund of many bonds then surely new ones are added as older ones mature? Thus, the fund will not necessarily approach the SEC yield ever. (Assuming consistent interest rates for the prior example).

So what's a good way to compare funds? Is using the SEC yield better than looking at the average annual returns? (I know, I know - past performance is not an indicator of future performance but you can get an idea of how volatile a fund is at least). Also, the SEC yield is consistently several percentage points lower than the average annual returns. It seems strange to assume that, despite an average of 6% returns over the last decade and 7% in the last year, the yield will suddenly drop to 2% (which is the SEC yield). Is the SEC yield really an estimation of expected performance for these types of funds or am I misusing it?

Thanks.