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Old 05-15-2022, 06:22 PM   #421
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I see that Fidelity seems to offer Treasury instruments.

But are you paying fees or commissions? Or buying them at higher prices than buying through Treasury Direct?

My understanding is you can only get auction prices with a TD account? So when you buy them through a brokerage, are these secondary market prices?

I saw one instrument which has a 1-year maturity but the price was over $100 while the rest was under $100 and the yield was supposedly over 2.1%.
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Old 05-15-2022, 07:36 PM   #422
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No, you get $1000 back. The difference between $985 and $1000 is your interest payment.
It took me awhile to understand "face value", thank you for clarify
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Old 05-15-2022, 07:37 PM   #423
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... I saw one instrument which has a 1-year maturity but the price was over $100 while the rest was under $100 and the yield was supposedly over 2.1%.
That 2.1% for 12-month sounds about right.... I was looking at a 12-month CD today that was 2.04%.
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Old 05-16-2022, 06:54 AM   #424
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5 Year MYGAs reached 4.05% today. B++ companies but.
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Old 05-16-2022, 07:40 AM   #425
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Originally Posted by explanade View Post
I see that Fidelity seems to offer Treasury instruments.

But are you paying fees or commissions? Or buying them at higher prices than buying through Treasury Direct?

My understanding is you can only get auction prices with a TD account? So when you buy them through a brokerage, are these secondary market prices?

I saw one instrument which has a 1-year maturity but the price was over $100 while the rest was under $100 and the yield was supposedly over 2.1%.
Compared to Treasury Direct - no, you are getting exactly the same auction prices plus the auto roll option. Fidelity is buying them for you at each auction and not charging extra. These are at a set time and day each week.
You can see upcoming auctions and results here: https://www.treasurydirect.gov/insti...t.htm?upcoming

On the secondary market, any Fidelity commission or fees is part of the buy/sell spread and they trade continually during regular bond market hours.
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Old 05-16-2022, 08:06 AM   #426
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The spreads are very small to buy in the secondary market. Would much rather have it in a brokerage over Treasury Direct.
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Old 05-16-2022, 09:42 AM   #427
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Originally Posted by audreyh1 View Post
Compared to Treasury Direct - no, you are getting exactly the same auction prices plus the auto roll option. Fidelity is buying them for you at each auction and not charging extra. These are at a set time and day each week.
You can see upcoming auctions and results here: https://www.treasurydirect.gov/insti...t.htm?upcoming

On the secondary market, any Fidelity commission or fees is part of the buy/sell spread and they trade continually during regular bond market hours.
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The spreads are very small to buy in the secondary market. Would much rather have it in a brokerage over Treasury Direct.

OK so if I purchase something on Fidelity which is under 100, then I buy say 1,000 or 10,000 and it would be $9850 or $98500 and in a year, I'd get back $10,000 or $100,000 in a year, just as I would at TD?

I didn't create a TD account but I didn't see a way to browse for instruments like you can at Fidelity, though I was logged in over there.


And just to clarify, anything 1 year or shorter is a Treasury Bill, I think 2 to 10 years maturity is a Note and anything longer is a Treasury Bond?
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Old 05-16-2022, 10:36 AM   #428
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Fidelity sells new issue treasuries in units of $1000. So if you bought the 52 week bill at auction last week, say quantity 10, you would have paid $9,810.9222, and will get $10,000 back at the end of a year, just like at Treasury Direct. Plus you can sign up for the Fidelity Auto Roll feature which automatically rebuys the same bill/note at maturity.

The TD page which is most useful regarding treasury auctions IMO is the link I gave above. No login required. https://www.treasurydirect.gov/insti...t.htm?upcoming
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Old 05-16-2022, 10:48 AM   #429
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And just to clarify, anything 1 year or shorter is a Treasury Bill, I think 2 to 10 years maturity is a Note and anything longer is a Treasury Bond?
Yes, at original issuance. Notes and Bonds can be approaching maturity and be under one year.
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Old 05-16-2022, 10:52 AM   #430
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Is there an advantage to a Treasury Bill, over say a 1 yr CD at 2.1%?
Thanks!
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Old 05-16-2022, 11:00 AM   #431
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Is there an advantage to a Treasury Bill, over say a 1 yr CD at 2.1%?
Thanks!
Whichever is yielding more for the same duration at the time. Both are backed by US govt assuming FDIC on the CD.
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Old 05-16-2022, 11:07 AM   #432
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Thanks. Looks like its 2.04% V.S 2.1% today.
Basically the same rate.
Thought there may have been something I wasn't aware of.
Thanks again
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Old 05-16-2022, 12:19 PM   #433
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Thanks. Looks like its 2.04% V.S 2.1% today.
Basically the same rate.
Thought there may have been something I wasn't aware of.
Thanks again

You donít have to pay state income tax on treasuries.
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Old 05-16-2022, 12:22 PM   #434
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Good to know!
Shopping for IRA fixed income right now.
But did not know that. Have some cash CD's due in 2024.
Will ck it then.
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Old 05-17-2022, 10:53 PM   #435
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I just canceled all my Ally No Penalty CDs at .55% and reopened them at .70%. Takes a second.
Thanks for mentioning this, it motivated me to look and it was easy to cash in my Ally No Penalty CDs. Could do it all online.
Previously a person had to phone in.

So 5 minutes later, they were all cashed and earning .60% in the savings account (while I decide what to do) instead of earning .55% and .50%
DW did the same thing.
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Old 05-18-2022, 09:53 AM   #436
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Just picked up a one year treasury from auction at 2.164%. Not too bad.
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Old 05-18-2022, 10:33 AM   #437
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^^^ No, not bad at all.
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Old 05-18-2022, 10:48 AM   #438
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I was delighted to get 2.52 on a Fed Home Loan with 9/23 maturity. Replaced Ally no penalty cd of .55-.60

Update--not sure yet what happened--offered ask price and took 25% more than min lot but order got cancelled. Maybe dealer wants entire lot but not sure why show min at 40 and still reject order of 50??
This is an agency bond, anybody know why order should be cancelled ?
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Old 05-18-2022, 10:58 AM   #439
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I noticed one can buy treasury bills at auction and have them automatically rolled over at maturity. Is their any advantage to doing this or is it generally done for convenience?
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Old 05-18-2022, 11:04 AM   #440
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I noticed one can buy treasury bills at auction and have them automatically rolled over at maturity. Is their any advantage to doing this or is it generally done for convenience?

I just do it for convenience in case I forget. If something changes, it's easy to get back in and change the number of renewals.
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