Selling Partial Position

[Tranquility Base]

I haven't sold that many stocks and, when I have, I have generally sold the entire position. My understanding is that when stocks are sold (at least at Schwab where most of my portfolio is) I have the option of selecting which stocks to sell so I might be able to make the sale at a loss or a gain, depending on which stocks I sell and my basis in those stocks. Also I can sell one stock or the entire position, or any number in between.

Is the same true of US Treasury Bills and Notes? I am considering moving some of my funds from an online savings account to US Treasury Bills. It is mainly to gain some experience on how various things are purchased at Schwab. I also don't mind picking up some additional interest on the funds compared to what they would earn at an online savings account.

Suppose I was moving $5,000 from savings into US Treasury Bills. Would it be better to buy five $1,000.00 US Treasury Bills (thus 5 separate transactions) instead of one $5,000.00 US Treasury Bill? The interest would be the same. But if for some reason I wanted to pull out some of the $5,000, I am assuming that in the second example (one transaction, one $5,000.00 US Treasury Bill) I could only sell the whole thing, that is, there would be just one position and one Treasury Bill in the amount of $5,000.00. But in the first example, even though I had a little more hassle up front with five separate transactions, I would have the ability to pull out my $5,000 in increments of $1,000.00 each. Of course I am glossing over the fact that the value of the original $5,000.00 position might be more or less, depending on whether interest rates had declined or increased since the $5,000.00 was invested in the Treasure Note(s). I don't really anticipate selling a US Treasury Bill before maturity. I am just trying to understand how things work and what my options would be.

 

[pb4uski]

TBills and most bonds are typically transacted in $1,000 increments, so if you buy $5,000 of TBills you are really buyng 5 $1,000 TBills. However, there may be minimum and mazimum quantities for each bid or ask price.

 

[Tranquility Base]

TBills and most bonds are typically transacted in $1,000 increments, so if you buy $5,000 of TBills you are really buyng 5 $1,000 TBills. However, there may be minimum and mazimum quantities for each bid or ask price.

Thanks. I've seen the minimum and maximum quantities. I don't recall ever seeing any minimums which have ever been below what amounts to $1,000 (1 TBill of $1,000 usually). Some of the maximums can get quite hefty. I'll have to check my account online again. I think it would still show the $5,000 of TBills as one position. It's good to know that it is really five $1,000 TBills. That makes the purchase transaction easier, 1 transaction instead of 5 smaller ones. Much appreciated!

 

[MarieIG]

When I put in my order for the Treasury Bills it is in $1000 increments. So if I buy $5,000 worth, it is five separate bills but it goes in as one order. I haven't sold any, but I see no reason why you couldn't sell one T bill at a time.

BTW, when I first started buying treasuries - I did exactly what you said to see what would happen, i.e. put in five separate orders. It "looked" exactly the same as putting in one order for the same amount.

 

[COcheesehead]

Thanks. I've seen the minimum and maximum quantities. I don't recall ever seeing any minimums which have ever been below what amounts to $1,000 (1 TBill of $1,000 usually). Some of the maximums can get quite hefty. I'll have to check my account online again. I think it would still show the $5,000 of TBills as one position. It's good to know that it is really five $1,000 TBills. That makes the purchase transaction easier, 1 transaction instead of 5 smaller ones. Much appreciated!

A $5000 position is 5, $1000 bonds.

If buy lots are too big, look at depth of book. On Fidelity it’s a little book symbol. It will show you smaller minimum order sizes, though with corresponding lower yields accordingly. Usually not by much though.

 

[Tranquility Base]

A $5000 position is 5, $1000 bonds.

If buy lots are too big, look at depth of book. On Fidelity it’s a little book symbol. It will show you smaller minimum order sizes, though with corresponding lower yields accordingly. Usually not by much though.

I've noticed the same thing when I've looked around on Schwab. The minimum order size can increase substantially leaving me to think that the yield will be that much greater. But that's usually not the case. It just always pays to be patient and look around a bit before making the purchase.