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I've been recently reading about treasuries and trying to understand how they work. In particular, within IBKR I can search for US treasuries and get the numbers listed in the screenshot.

What I've read is that the traesuries will in principle start at a price of 100-interest, e.g. 95 with 5%, and will get liquidated at 100 on the maturity date. Question 1: would these listed treasuries be, ones that someone bought at 95 and now tries to sell higher?

The closing price in the screenshot below is 97.46. The yields are close to 5.45%. Question 2: how is the yield 5.45% if the bill will pay 100 back for a price of 97.46? 100-97.46=2.54% yield, am I wrong?

Question 3: What are the size/x thousand face value numbers and how can they sometimes be different between bid and ask? Does it mean that the listing has 15000k worth of treasuries (of 100$ each?) and would someone need to buy them all?

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  • You should probably look into the IBKR documentation on what information is present in their system and how it is presented.
    – littleadv
    Jul 24, 2023 at 16:25

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What I've read is that the treasuries will in principle start at a price of 100-interest, e.g. 95 with 5%, and will get liquidated at 100 on the maturity date.

In this case, yes, because these are short-term bills that do not pay a coupon; longer term bonds that pay a periodic coupon are typically priced closer to their redemption value (100)

Question 1: would these listed treasuries be, ones that someone bought at 95 and now tries to sell higher?

Not necessarily - you have no idea what they were bought for, and can't tell that from the current yield. They might actually be selling at a loss if interest rates have risen significantly from when they were purchased.

how is the yield 5.45% if the bill will pay 100 back for a price of 97.46? 100-97.46=2.54% yield, am I wrong?

Yields are always annualized, so the periodic (~6 month) yield is converted to an annual yield to be equivalent with other bonds that mature at different times.

What are the size/x thousand face value numbers and how can they sometimes be different between bid and ask? Does it mean that the listing has 15000k worth of treasuries (of 100$ each?) and would someone need to buy them all?

Yes someone is offering $15 Million of bonds at that price. Whether you have to buy them all or not depends on whether the seller specified an "all-or-none" order and requires that the entire order be filled.

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