Some background info for buying 13-week or 26-week treasuries at auction through Fidelity for those who haven’t done it. A little tutorial if you will. Fidelity offers this service plus an auto roll feature for free.
BTW I only buy t-bills during periods of rising interest rates when high yield savings accounts, money market funds and short-term CDs can’t seem to catch up. Once rates stabilize I usually move back to CDs.
I’ve been buying 13 week and 26 week t-bills at auction. These are auctioned on Monday, or Tuesday if Monday is a market holiday.
The next Monday auction is normally announced by the Treasury Department on a Thursday. At some point on Thursday the treasuries to be auctioned will show up under the “New Issue” tab in Fidelity’s fixed income offerings. The duration of each treasury is indicated by the maturity date.
At any time between Thursday and very early Monday morning, you can click on the Trade button and simply enter how much you want in $1000s. So for $50,000 you would enter quantity 50. Until (? hours before) the auction goes through you can cancel your order. At Fidelity you can also select Auto Roll if you want the t-bill to automatically roll over to the same duration when it matures.
For me this takes maybe 10 seconds.
Late Monday morning you get a trade confirmation with the details and you can also look at the Treasury Direct auction results. I like this page which gives the next upcoming auctions as well as the latest auction results including price and yield.
https://www.treasurydirect.gov/instit/instit.htm?upcoming
The Monday trade settles on the following Thursday.
These are zero coupon bills so you will be paying slightly under the amount you ordered, then you will be returned the full amount upon maturity, and the difference is your interest payment. The auction determines exactly the interest rate you will pay, it’s not known exactly ahead of time. Normally it’s very close to what the secondary market is trading maybe even slightly above in my experience. Looking at the recent secondary market is really the only way to gage your likely yield ahead of time. Here is a handy little calculator for determining your equivalent coupon and annualized yield.
https://goodcalculators.com/treasury-bills-calculator/