Another Reader
Thinks s/he gets paid by the post
- Joined
- Jan 6, 2013
- Messages
- 3,417
At this exact point in time, you can't go wrong with VMFXX. It is better than languishing in a bank account.
But this will change someday, and change fast.
One suggestion? If someone wants to try out their broker's treasury buying process, now is a good time to buy a small 8 or 13 week bill. There's little risk, and you can understand the process so that perhaps someday when you want to buy the big one, you'll have more confidence in the interface.
It is very different than buying an equity, ETF or mutual fund. Windows open and close on purchasing at auction. Settlement occurs later after the results are announced. The mechanics are very different, so it is worth trying out and buying a small T-bill or two right now to get a feel for how it all works, and what is presented on your brokerage holdings screen.
Great advice! I could not understand how this worked until I started buying them at Fidelity. The interest rate was never what was quoted. Why? It's an auction. And I learned to look up the auction date and get the order in the day before. Also, rolling them over meant you could be out of the market for a couple of days. I'm lazy, so for short term, I just use VMFXX now. If the spread widens, it's back to treasuries.