Purchased 13 week Treasuries got 1 year

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investorjon
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Purchased 13 week Treasuries got 1 year

Post by investorjon »

On April 11, I purchased 13 week treasuries in my Roth and Trad IRA's using Vanguard. Looking at the transaction today, I see I got "U S TREASURY BILL CPN 0.00000 % MTD 2022-07-14 DTD 2021-07-15". I've sent a message to Vanguard to look into this but what should I do at this point?

Thanks,
Jon
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retired@50
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Re: Purchased 13 week Treasuries got 1 year

Post by retired@50 »

investorjon wrote: Thu May 19, 2022 10:14 am On April 11, I purchased 13 week treasuries in my Roth and Trad IRA's using Vanguard. Looking at the transaction today, I see I got "U S TREASURY BILL CPN 0.00000 % MTD 2022-07-14 DTD 2021-07-15". I've sent a message to Vanguard to look into this but what should I do at this point?

Thanks,
Jon
It appears to me the maturity date (assuming MTD means maturity date) is only 8 weeks away from today.

Will this be a problem for you?

Regards,
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drk
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Re: Purchased 13 week Treasuries got 1 year

Post by drk »

Five weeks ago, you bought a Treasury with 13 weeks left until maturity. That it was originally a 52-week bill doesn't really mean anything.
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runninginvestor
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Re: Purchased 13 week Treasuries got 1 year

Post by runninginvestor »

If you bought on April 11th and it matures 7/14, that's 94 days or just over 13 weeks. You didn't buy a tbill that was issued and matures in 13 weeks. You bought a 1 year treasury that matures in 13 weeks. For 0-coupons, they should be basically the same.
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vineviz
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Re: Purchased 13 week Treasuries got 1 year

Post by vineviz »

investorjon wrote: Thu May 19, 2022 10:14 am On April 11, I purchased 13 week treasuries in my Roth and Trad IRA's using Vanguard. Looking at the transaction today, I see I got "U S TREASURY BILL CPN 0.00000 % MTD 2022-07-14 DTD 2021-07-15". I've sent a message to Vanguard to look into this but what should I do at this point?
This bill matures on July 14, which is 13 weeks after April 11th.

I'm not sure what you would need to do except wait for the bill to mature.
"Far more money has been lost by investors preparing for corrections than has been lost in corrections themselves." ~~ Peter Lynch
MrJedi
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Re: Purchased 13 week Treasuries got 1 year

Post by MrJedi »

You bought a 52 week bill that matures in approximately 13 weeks from your purchase date. There's nothing wrong here unless you intended to buy a new issue bill for some reason. Treasuries are very liquid so I would have no concerns about getting a fair deal, probably very close to what a new issue would have gotten, possibly better.
Last edited by MrJedi on Thu May 19, 2022 11:17 am, edited 1 time in total.
FactualFran
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Re: Purchased 13 week Treasuries got 1 year

Post by FactualFran »

The auction of 13-week T-bills on 2022-04-11 was a reopening of 52-week T-bill originally auctioned 2021-07-15. In general, when the result of a Treasury auction is that the security being auction has the same maturity date and coupon rate as an existing security, the auction is treated as having been of more of the existing security rather than a new one.
secondopinion
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Re: Purchased 13 week Treasuries got 1 year

Post by secondopinion »

investorjon wrote: Thu May 19, 2022 10:14 am On April 11, I purchased 13 week treasuries in my Roth and Trad IRA's using Vanguard. Looking at the transaction today, I see I got "U S TREASURY BILL CPN 0.00000 % MTD 2022-07-14 DTD 2021-07-15". I've sent a message to Vanguard to look into this but what should I do at this point?

Thanks,
Jon
Look at the maturity as this is what matters; the original issue date of the treasury bill is besides the point. Vanguard is probably going to tell you exactly what people here are saying. It confused me the first time I bought a treasury bill, but I realized the maturity is still correct.
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student
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Re: Purchased 13 week Treasuries got 1 year

Post by student »

FactualFran wrote: Thu May 19, 2022 11:10 am The auction of 13-week T-bills on 2022-04-11 was a reopening of 52-week T-bill originally auctioned 2021-07-15. In general, when the result of a Treasury auction is that the security being auction has the same maturity date and coupon rate as an existing security, the auction is treated as having been of more of the existing security rather than a new one.
This is good info. Learned something today.
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investorjon
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Re: Purchased 13 week Treasuries got 1 year

Post by investorjon »

FactualFran wrote: Thu May 19, 2022 11:10 am The auction of 13-week T-bills on 2022-04-11 was a reopening of 52-week T-bill originally auctioned 2021-07-15. In general, when the result of a Treasury auction is that the security being auction has the same maturity date and coupon rate as an existing security, the auction is treated as having been of more of the existing security rather than a new one.
Thank you for this explanation. Can I assume the interest rate will be somewhere around the "indicative yield" that was stated when I purchased the bill?

Thanks,
Jon
ekid
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Re: Purchased 13 week Treasuries got 1 year

Post by ekid »

investorjon wrote: Thu May 19, 2022 11:40 am
FactualFran wrote: Thu May 19, 2022 11:10 am The auction of 13-week T-bills on 2022-04-11 was a reopening of 52-week T-bill originally auctioned 2021-07-15. In general, when the result of a Treasury auction is that the security being auction has the same maturity date and coupon rate as an existing security, the auction is treated as having been of more of the existing security rather than a new one.
Thank you for this explanation. Can I assume the interest rate will be somewhere around the "indicative yield" that was stated when I purchased the bill?

Thanks,
Jon
Indeed. I suppose any difference would matter if you were buying multiple millions- as the "Big Swingers" do in this market. A couple hundred K- no.
FactualFran
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Re: Purchased 13 week Treasuries got 1 year

Post by FactualFran »

investorjon wrote: Thu May 19, 2022 11:40 am Thank you for this explanation. Can I assume the interest rate will be somewhere around the "indicative yield" that was stated when I purchased the bill
The difference between an "indicative yield" when a buy order was submitted and the rate determined by the auction depends on how much the market yield of similar securities has changed between when the order was submitted and the auction deadline for competitive bids.

I don't know what the indicative yield was when you submitted the order, but the auction results for the 13-week T-bill auctioned 2022-04-11 was a high discount rate of 0.785% (on the maturity value), with the investment rate being 0.797% (on the price of $99.801569 per $100 of maturity value).
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