RetiredAndLovingIt
Thinks s/he gets paid by the post
Thanks for the info Joe. I've been considering notes but still not sure if I understand so I will follow your reports until I'm more comfortable.
Thanks for the info Joe. I've been considering notes but still not sure if I understand so I will follow your reports until I'm more comfortable.
This week’s T-bill auction results.
Bills CMB CUSIP Issue Date High Rate Investment Rate Price per $100 4-Week No 912797HD2 10/03/2023 5.290% 5.400% $99.588556 8-Week No 912797HM2 10/03/2023 5.330% 5.464% $99.170889 13-Week No 912796ZN2 09/28/2023 5.330% 5.493% $98.652694 17-Week No 912797JB4 10/03/2023 5.345% 5.532% $98.233181 26-Week No 912797GY7 09/28/2023 5.315% 5.553% $97.312972
I’m participating in Monday’s 26-week auction. This is to replace a 6 month CD bought during the bank scare 6 months ago. That depressed T-bill rates for a while, and banks on the other hand raised the CD rates they were offering. That little upset lasted about a month.
I don't really think that the yields that are indicated by Treasury Direct are really correct.
For example, on 09-26-2023 I bought a 17-Week Bill; par value $10,000 and I paid $9,823.48.
The Security History Detail indicates an Investment/Interest Rate of 5.527% and a Yield of 5.340% and a discount of $176.52 ($10,000-$9,823.48).
Issue date was 09-26-23 and maturity date is 01-23-2024.
I can recalculate the 5.527% Investment/Interest Rate as =((100-98.234833)/98.234833)*(366/(maturity date-issue date)) which is the formula that is provided on the Treasury Direct website.
However, if I use Excel's RATE function, I get 5.614% =RATE((maturity date-issue date)/365,0,-98.234833,100)
So I think that I'm really getting a 5.614% yield rather that what is shown by Treasury Direct.
Put another way, I'm getting 1.79691% ($176.52 discount divided by $9,823,48 cost) for 119 days (01/23/2024 maturity - 09/26/2023 issue date).
((1+1.79691%)^(365/119))-1 = 5.614%... the same as the RATE calculation result.
Other than I have too much time on my hands, any thoughts?
We're also in the 366 zone until next March 1. Using 365 will break results.
The new issues are typically set with coupons so that they price a little under par.Question on Treasury auctions:
Looking at the auction schedule https://home.treasury.gov/system/files/221/Tentative-Auction-Schedule.pdf
The 10Y announcing on Oct 5 will be a re-issue.
And the 10Y announcing on Nov 1 will be a new issue.
The re-issue will have the same coupon rate as when originally issued.
What is the likelyhood the Nov1 new issue will have a higher coupon in line with increased rates? Or does the coupon typically stay flat-ish across issues and the difference is made up in the lower price?
T's have been competitive with similar term CD's lately so I was leaning towards Ts as they are more liquid... but I need the coupons for cash flow.
The new issues are typically set with coupons so that they price a little under par.
Bills | CMB | CUSIP | Issue Date | High Rate | Investment Rate | Price per $100 |
4-Week | No | 912797HJ9 | 10/10/2023 | 5.310% | 5.421% | $99.587000 |
8-Week | No | 912797HN0 | 10/10/2023 | 5.355% | 5.490% | $99.167000 |
13-Week | No | 912797FW2 | 10/05/2023 | 5.345% | 5.509% | $98.648903 |
17-Week | No | 912797JC2 | 10/10/2023 | 5.350% | 5.537% | $98.231528 |
26-Week | No | 912797GZ4 | 10/05/2023 | 5.340% | 5.580% | $97.300333 |
52-Week | No | 912797GW1 | 10/05/2023 | 5.185% | 5.488% | $94.757389 |
And the 30 year is over 5% right now (TYX is at 50.30 as I write this or 5.03%).Wow, jobs blew past expectations. Consensus 160k, Actual 336k. Prior 187k, adjusted to 227k. Very strong report. Private payrolls 150k, Actual 263k.
10 year Treasury responded strongly, up 13 basis points so far to 4.839% according to CNBC, nearing a 16 year high. This will slam high duration bond funds. Crazy.
Wow, jobs blew past expectations. Consensus 160k, Actual 336k. Prior 187k, adjusted to 227k. Very strong report. Private payrolls 150k, Actual 263k.
10 year Treasury responded strongly, up 13 basis points so far to 4.839% according to CNBC, nearing a 16 year high. This will slam high duration bond funds. Crazy.
Look at the past job numbers going back to 2021. Just about every month, there are a few exceptions) the BLS announces blow out job numbers and revises previous month numbers down. One article I read that claimed all the the 2021 job increases where wiped out by subsequent downward revisions (I can't find the article back... it's been archived behind a paywall). The BLS has been politicized such that non-MSM news sites are not taking them seriously any more.
Bills | CMB | CUSIP | Issue Date | High Rate | Investment Rate | Price per $100 |
4-Week | No | 912797HK6 | 10/17/2023 | 5.325% | 5.436% | $99.585833 |
8-Week | No | 912797HU4 | 10/17/2023 | 5.345% | 5.480% | $99.168556 |
13-Week | No | 912797GC5 | 10/12/2023 | 5.340% | 5.503% | $98.650167 |
17-Week | No | 912797JD0 | 10/17/2023 | 5.355% | 5.542% | $98.229875 |
26-Week | No | 912797HF7 | 10/12/2023 | 5.320% | 5.558% | $97.310444 |
The U.S. Treasury on Thursday will auction $22 billion in a new 5-year Treasury Inflation-Protected Security, and the results should be attractive for investors seeking protection from future inflation. It should generate the highest real yield to maturity for any auction of this term in 15 years.
This is CUSIP 91282CJH5, which will mature Oct. 15, 2028. The $22 billion auction size is the largest ever for this term, up from $21 billion for similar auctions in October 2022 and April 2023. The coupon rate and real yield to maturity will be set by the auction results.
It’s a small window I don’t know for sure. But certainly before 8 maybe 9 eastern. You might want to call about this.Can anyone tell me, what the cutoff time is to enter a buy order, on the day that a 52 week Treasury goes to auction on Fido? I have a Treasury that comes due 10/31/23, the proceeds of which will be available to trade that morning, or perhaps 12:01 AM on that day. I want to roll it into a new 52 week bill that will be auctioned on 10/31/23. Will I have enough time to use those maturing funds to roll into the new bill, or should I transfer $$ into Fido to cover the purchase and hit buy prior to 10-31?
5-year TIPS auction this week:
From TIPSwatch https://tipswatch.com/2023/10/15/th...uction-offers-a-solid-investment-opportunity/