Join Early Retirement Today
Reply
 
Thread Tools Display Modes
Old 01-27-2024, 01:08 PM   #81
Confused about dryer sheets
 
Join Date: Jan 2024
Posts: 1
Hey guys

Iím an Amatuer at best but have been learning a lot from this thread. Iíve been purchasing t-bills through Charles Schwab for well over a year now but the rate of return doesnít jive with whatís posted (updated weekly) here.

Is this because Iím getting them second hand?
Does Schwab take that much of a cut? Iíve scoured their website and cannot figure out how much they take.
Would it be more advantageous for a person to skip Schwab and buy them directly from the gov?

Thanks
Shelbydoo is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 01-27-2024, 01:41 PM   #82
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Dash man's Avatar
 
Join Date: Mar 2013
Location: Limerick
Posts: 5,613
I typically buy mine at auction at no charge.
When you buy them on the secondary market, Schwab has their small fee baked into the price.
In the secondary market, the Yield to Maturity is based on both the coupon rate and the price you pay. If you buy your treasury (or any bond) at a discount to the face value, some of your return is based on the portion you are paid at maturity, where you receive the difference between the purchase price and face value. If you pay above the face value of the treasury, your return is lower than the coupon rate.
Dash man is offline   Reply With Quote
Old 01-27-2024, 02:01 PM   #83
Recycles dryer sheets
 
Join Date: May 2015
Location: NorCal
Posts: 328
Quote:
Originally Posted by Shelbydoo View Post
Hey guys

...Would it be more advantageous for a person to skip Schwab and buy them directly from the gov?
Thanks
Most of what is posted on this thread is the yield on auction of new issues. You can buy new issues on Schwab's website by going to Research>Bonds CDs and Fixed Income. Scroll down to the bottom of the page where it says New Issues. Click on "Treasury Auctions" to see what is currently available.

The availability is based on the auction schedule that can be found at

https://home.treasury.gov/system/fil...n-Schedule.pdf

The yield of recent auctions can be found at

https://www.treasurydirect.gov/aucti...-data-results/
FIREd_2015 is offline   Reply With Quote
Old 01-27-2024, 03:15 PM   #84
Full time employment: Posting here.
jldavid47's Avatar
 
Join Date: Mar 2019
Posts: 739
Quote:
Originally Posted by Shelbydoo View Post
Hey guys

Iím an Amatuer at best but have been learning a lot from this thread. Iíve been purchasing t-bills through Charles Schwab for well over a year now but the rate of return doesnít jive with whatís posted (updated weekly) here.

Is this because Iím getting them second hand?
Does Schwab take that much of a cut? Iíve scoured their website and cannot figure out how much they take.
Would it be more advantageous for a person to skip Schwab and buy them directly from the gov?

Thanks
If you buy them at auction there is no difference between buying them from your Schwab account or on Treasury Direct. You get the same price. If you purchase them on the secondary market there is a bid/ask spread. You buy at the ask (the higher price) and can sell at the bid (the lower price). Schwab (and every other broker on the planet) makes their money off the bid/ask spread. There is no commission if you do it online. Some brokers allow you to put in an order for bonds/bills online at your desired purchase price. Schwab does not.

One thing you need to remember is that the fixed income market is not like the equity market from an order entry and execution standpoint. The only thing they have in common is a bid/ask spread. And once the auction is held, the market price of the T-bill moves with the market. If you want to get the prices and rate you see here, buy at auction.
jldavid47 is offline   Reply With Quote
Old 01-27-2024, 03:53 PM   #85
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
audreyh1's Avatar
 
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 37,756
This weekís T-Bill auction results:

BillsCMBCUSIPIssue DateHigh RateInvestment RatePrice per $100
4-WeekNo912797JF501/30/20245.280%5.390%$99.589333
8-WeekNo912797JK401/30/20245.275%5.407%$99.179444
13-WeekNo912797HG501/25/20245.225%5.383%$98.679236
17-WeekNo912797JY401/30/20245.185%5.363%$98.286069
26-WeekNo912797JT501/25/20245.020%5.237%$97.462111
52-WeekNo912797JR901/25/20244.570%4.814%$95.379222
__________________
Retired since summer 1999.
audreyh1 is offline   Reply With Quote
Old 01-31-2024, 11:45 AM   #86
Recycles dryer sheets
 
Join Date: Oct 2007
Location: Georgetown
Posts: 420
Looks like 26-week (today's rate 5.154) is dipping below MM. Given MM shouldn't really drop until short terms rates are lowered, does it make sense to buy 26-week anymore if one doesn't anticipate Fed lowering being at least six months out? On the other side the inventory of all durations of treasury bills, notes, and bonds will just be increasing providing a floor for treasuries; is 26-week stilll the sweet spot or will one or two year become the sweet spot "soon?"
__________________
"Adventure is just bad planning"

Roald Amundsen
Marc is offline   Reply With Quote
Old 01-31-2024, 03:49 PM   #87
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
calmloki's Avatar
 
Join Date: Jan 2007
Location: Independence
Posts: 7,255
I slid in on some 5.5% 15 month CDs, but also have a filled order for a 4-month T-bill from yesterday. California and a 9+% state tax rate makes T-bills worthwhile for us for a longer time than lower state tax folks.
__________________
"Be kind whenever possible. It is always possible." Dalai Lama
calmloki is offline   Reply With Quote
Old 01-31-2024, 04:00 PM   #88
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
audreyh1's Avatar
 
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 37,756
Quote:
Originally Posted by Marc View Post
Looks like 26-week (today's rate 5.154) is dipping below MM. Given MM shouldn't really drop until short terms rates are lowered, does it make sense to buy 26-week anymore if one doesn't anticipate Fed lowering being at least six months out? On the other side the inventory of all durations of treasury bills, notes, and bonds will just be increasing providing a floor for treasuries; is 26-week stilll the sweet spot or will one or two year become the sweet spot "soon?"
Thatís the debate. Iíve spread my bets- have 26 week, 13-week and MM fund.

The 26-week T-Bill auctioned at 5.199% on Monday. I was happy to lock in 6 months at that rate. Thatís into the 2nd half of this year.

1 and 2 year have been well below the 26 week for a while.

13 week has been a bit higher than the 26 week for a while.
__________________
Retired since summer 1999.
audreyh1 is offline   Reply With Quote
Old 02-01-2024, 02:00 PM   #89
Full time employment: Posting here.
jldavid47's Avatar
 
Join Date: Mar 2019
Posts: 739
Quote:
Originally Posted by Marc View Post
Looks like 26-week (today's rate 5.154) is dipping below MM. Given MM shouldn't really drop until short terms rates are lowered, does it make sense to buy 26-week anymore if one doesn't anticipate Fed lowering being at least six months out? On the other side the inventory of all durations of treasury bills, notes, and bonds will just be increasing providing a floor for treasuries; is 26-week stilll the sweet spot or will one or two year become the sweet spot "soon?"
It makes sense if you are paying state income tax on the MM fund interest.
jldavid47 is offline   Reply With Quote
Old 02-01-2024, 03:53 PM   #90
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
audreyh1's Avatar
 
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 37,756
This weekís T-Bill Auction results:

BillsCMBCUSIPIssue DateHigh RateInvestment RatePrice per $100
4-WeekNo912797JG302/06/20245.280%5.390%$99.589333
8-WeekNo912797JL202/06/20245.265%5.397%$99.181000
13-WeekNo912797HH302/01/20245.210%5.368%$98.683028
17-WeekNo912797JZ102/06/20245.150%5.327%$98.297639
26-WeekNo912797JU202/01/20244.985%5.199%$97.479806
__________________
Retired since summer 1999.
audreyh1 is offline   Reply With Quote
Old 02-09-2024, 06:50 AM   #91
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
audreyh1's Avatar
 
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 37,756
This week’s T-Bill auction results:

BillsCMBCUSIPIssue DateHigh RateInvestment RatePrice per $100
4-WeekNo912797JH102/13/20245.280%5.390%$99.589333
8-WeekNo912797JM002/13/20245.270%5.402%$99.180222
13-WeekNo912797HQ302/08/20245.235%5.394%$98.676708
17-WeekNo912797KE602/13/20245.180%5.358%$98.287722
26-WeekNo912797GK702/08/20245.045%5.263%$97.449472

Rates back up where they were 2 weeks ago. There was a little dip last week.


Also I forgot to include the Notes (monthly) for January last week. A couple already had their early February auction:

NotesReopeningCUSIPIssue DateHigh YieldInterest RatePrice per $100
2-YearNo91282CJV401/31/20244.365%4.250%$99.782022
3-YearNo91282CKA802/15/20244.169%4.125%$99.877119
5-YearNo91282CJW201/31/20244.055%4.000%$99.753334
7-YearNo91282CJX001/31/20244.109%4.000%$99.342733
10-YearNo91282CJZ502/15/20244.093%4.000%$99.243059
__________________
Retired since summer 1999.
audreyh1 is offline   Reply With Quote
Treasury STRIPS?
Old 02-09-2024, 07:02 AM   #92
Recycles dryer sheets
PointBreeze's Avatar
 
Join Date: Jul 2017
Location: Pittsburgh
Posts: 294
Treasury STRIPS?

Looking to put some of our tax-deferred portfolio into 10-year treasuries (learned my lesson about bond funds!). I am a novice re: buying individual bonds. I was looking through the secondary market on Fidelity and found Treasury STRIPS.

Here is what I've found out about these:
Essentially, STRIPS are Treasury notes or bonds that have had their principal and interest components stripped apart and sold separately as zero-coupon bonds.
Does anyone have experience with these? I would appreciate any advice/information.

Thanks!
__________________
Retired from FT j*b 2017 @ 58, consulted PT then fully retired 2019 @ 60
AA: 53/37/10 | no pension
Into: spreadsheets, botanical art, fitness, IPAs, learning to play the piano, reading
Mantras: Carpe diem & Gratitude
PointBreeze is offline   Reply With Quote
Old 02-10-2024, 06:10 PM   #93
Moderator
sengsational's Avatar
 
Join Date: Oct 2010
Posts: 10,566
My grandmother bought one for each of my kids when they were born, maturing when they were 18. These were after tax, and so I got the 1099 IOD every year on the imputed gain. Kind of a PITA. In tax-deferred, that wouldn't be an issue. I would expect the IRR would be the same as other treasuries that still have their periodic payments.
sengsational is offline   Reply With Quote
Old 02-11-2024, 05:25 PM   #94
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
calmloki's Avatar
 
Join Date: Jan 2007
Location: Independence
Posts: 7,255
So this week we can do a 13 week, and 26 week, or a 42 day (why not 6 week?) on Tuesday. Kinda tempted by that one - is it normally more like the returns on a 4 week return T-bill? Any odd gotchas about it?
__________________
"Be kind whenever possible. It is always possible." Dalai Lama
calmloki is offline   Reply With Quote
Old 02-11-2024, 05:32 PM   #95
Thinks s/he gets paid by the post
 
Join Date: Jan 2013
Posts: 3,402
Quote:
Originally Posted by calmloki View Post
So this week we can do a 13 week, and 26 week, or a 42 day (why not 6 week?) on Tuesday. Kinda tempted by that one - is it normally more like the returns on a 4 week return T-bill? Any odd gotchas about it?
I routinely buy 13 and 26 week bills, as they have been the sweet spot recently. Whatever cash is sitting in the brokerage accounts gets deployed, unless it is earmarked for the periodic index fund purchases.
Another Reader is offline   Reply With Quote
Old 02-11-2024, 05:46 PM   #96
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
audreyh1's Avatar
 
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 37,756
Quote:
Originally Posted by calmloki View Post
So this week we can do a 13 week, and 26 week, or a 42 day (why not 6 week?) on Tuesday. Kinda tempted by that one - is it normally more like the returns on a 4 week return T-bill? Any odd gotchas about it?
Not really any gotchas although not all brokerages offer to buy it for you it at auction.

42 day instead of 6 week is because itís not a regularly offered T-bill.
__________________
Retired since summer 1999.
audreyh1 is offline   Reply With Quote
Old 02-13-2024, 08:38 AM   #97
Thinks s/he gets paid by the post
 
Join Date: Feb 2007
Location: Upstate
Posts: 2,934
Just a FYI. With today's inflation report, the 5 and 10 year TIPS yields shot up a bit this morning.

10y TIPS real rate is 1.988% as I type this, up from 1.856% 5 days ago. I'm trying to buy some (secondary).

ETA: Trade executed (just a 10K nibble) @ $97.945 (1.979% yield, the best I could do w/a smallish order).
copyright1997reloaded is offline   Reply With Quote
Old 02-14-2024, 01:34 PM   #98
Recycles dryer sheets
imbatman's Avatar
 
Join Date: Feb 2023
Posts: 329
FYI, for those new to high interest rates in Government Money Market funds....if you are in a high taxed state that allows deductions for government debt, you should take a gander at Fido's (for Fidelity Funds only) % of government holdings in their MM and Sweep funds, which they just released yesterday.....definitely going to be worth calculating for me:

https://www.fidelity.com/bin-public/...tal-Letter.pdf
imbatman is offline   Reply With Quote
Old 02-15-2024, 01:14 PM   #99
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
calmloki's Avatar
 
Join Date: Jan 2007
Location: Independence
Posts: 7,255
Quote:
Originally Posted by imbatman View Post
FYI, for those new to high interest rates in Government Money Market funds....if you are in a high taxed state that allows deductions for government debt, you should take a gander at Fido's (for Fidelity Funds only) % of government holdings in their MM and Sweep funds, which they just released yesterday.....definitely going to be worth calculating for me:

https://www.fidelity.com/bin-public/...tal-Letter.pdf
So I've been looking because we have some cash sitting in FZDXX, which claims a composition including 19.67% government debt and about 41% in government agency and US Treasury repurchase agreements.

Wouldn't mind writing off some portion of what we've earned in FZDXX given our Ca tax status. Only thing I found was something claiming that FZDXX held under 5% in state tax free, thus was ineligible for a write off. But I'm very unclear on this. Will say Fidelity hasn't sent us anything saying we can write down our taxes, so that's a bad sign.

Can any of you speak to whether any portion of FZDXX earnings is free of state tax before we ship off our tax data? I'd love to point out possible tax savings to our preparer.
__________________
"Be kind whenever possible. It is always possible." Dalai Lama
calmloki is offline   Reply With Quote
Old 02-15-2024, 01:26 PM   #100
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
audreyh1's Avatar
 
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 37,756
This weekís T-Bill auction results:

BillsCMBCUSIPIssue DateHigh RateInvestment RatePrice per $100
4-WeekNo912797JJ702/20/20245.280%5.390%$99.589333
8-WeekNo912797JN802/20/20245.270%5.402%$99.180222
13-WeekNo912797FH502/15/20245.230%5.388%$98.677972
17-WeekNo912797KF302/20/20245.215%5.395%$98.276153
26-WeekNo912797KB202/15/20245.065%5.285%$97.439361
__________________
Retired since summer 1999.
audreyh1 is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Treasury Bills, Notes, and Bonds Discussion jazz4cash FIRE and Money 2517 01-01-2024 02:21 PM
Treasury Bills Notes Bonds Co-Ownership CaptainO FIRE and Money 7 04-15-2018 06:31 AM
CD or Treasury bills and notes? Natalie FIRE and Money 4 07-14-2003 09:46 PM

» Quick Links

 
All times are GMT -6. The time now is 03:36 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2024, vBulletin Solutions, Inc.