Roll Short Term Treasuries or buy longer and sell as needed?

[UpQuark]

Right now I have 7 months cash in my MM core position, and the next two years worth of cash invested in very short term (4 week, 8 week, 13 week) treasuries.

I'm wondering if it would make any difference if I switch to putting all the money (as it matures in the next three months) into two year Treasury Notes and then selling a couple bonds each month in the Secondary market when I need the money?

Or would TIPS be better, would they be liquid enough on the secondary market to only sell a couple thousand dollars worth each month? I found it extremely overwhelming to try to figure out how to buy TIPS on the secondary market, but maybe I could buy 5 year TIPS and then sell a few thousand dollars worth whenever I need the money? Would that be costly, or would the inflation protection give them enough increase so they'd be better than the Notes?

 

[Montecfo]

My similar funds are in a MM at 4 15% for a few months with the balance in a treasury step-ladder rolling off quarterly.

Not sure you can reasonably do mych better. You will take a haircut by selling in the secondary market.

 

[pb4uski]

Why not just set up a CD/UST/GSE bond ladder that matures monthly or quarterly with your expected cash flow needs?

 

[daylatedollarshort]

I've been going out a few years on CDs/Treasuries/Agency bonds and then have TIPS for longer term maturities. You have to buy individual TIPS and hold to maturity to be guaranteed of the inflation protection + real yield. If you sell on the secondary market or own a TIPS fund you never know what the price will be when you want to sell.

Here is an example of a TIPS ladder from one financial adviser: " I built a strategy backed by the U.S. government with Treasury Inflation Protected Securities (TIPS) that supports a reasonably level real 4.3% withdrawal rate for 30 years. It’s not perfect, but it was good enough for me to put my money behind it. I implemented such a portfolio with just under $100,000 of my own family’s nest egg.", The 4% Rule Just Became a Whole Lot Easier - https://www.advisorperspectives.com/articles/2022/10/24/the-4-rule-just-became-a-whole-lot-easier

I don't have such a detailed ladder. Mine is a lot lumpier, but I am investing more for capital preservation than income so it works for me.

 

[gcgang]

Thought you were talking about rolling Treasuries to squeeze a couple extra bips, buying 3 months and selling when they’ve got about a month to go. Given a positively sloped yield curve, and minuscule spreads many trading platforms afford, you increase your yield. Today, 30 day yields are about 4%, 90 day 4.5%. Buy the 90, hold 60 days, ceteris paribus, you sell at a slight cap gain and roll back to 90 days.