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Questions tagged [government-bonds]

for questions that relate to government bonds. It is recommend you use a country tag or state what country you are referring to. A government bond is a bond issued by a national government, generally promising to pay a certain amount on a certain date, as well as periodic interest payments.

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Why are U.S 10 & 20 year Treasury yields dropping sharply

The 10 year Treasury bond, and 20+ Year yield rose sharply after U.S inflation data came in inline with expectations. On the same day though, you had the Presidential debate, and news of inflation ...
Jo Smit's user avatar
1 vote
1 answer
144 views

buying tbills from https://www.treasurydirect.gov/log-in/

I am planning to buy tbills from treasurydirect . This page says that auction happens every week then why is there so much of lag between my transaction date 05-18-2024 and Issue Date: 06-04-2024? ...
user2543622's user avatar
0 votes
1 answer
95 views

Can a retail investor enter into a reverse repo transaction?

Assuming an investor holds $1M worth of treasuries and urgently needs liquidity, can a retail investor enter into a reverse repo agreement through their broker with any of the institutions in an open ...
A. Shultz's user avatar
0 votes
1 answer
109 views

how to invest in short term UK government bonds at x-o.co.uk brokers?

I have some money idle at my x-o.co.uk ISA. as interest rates are quite healthy, I'd like to invest in UK government bonds of a few months terms. no idea how to do this, as I'd need the ticker codes, ...
Commenter's user avatar
4 votes
2 answers
638 views

Is it feasible for a small retail UK resident to buy UK inflation-linked GILTs directly from the issuer?

I'm interested in buying individual inflation-linked GILTs directly in the primary market (directly from the UK Debt Management Office). To give some context, I want to do this as I understand the ...
Martel's user avatar
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-1 votes
1 answer
64 views

Does checking "A portion of these dividends is U.S. Government interest." matter when filing tax in Washington state?

I'm filing my taxes in the US since I reside in WA state and I'm being asked by TurboTax whether a portion of these dividends is U.S. Government interest: Does checking "A portion of these ...
Franck Dernoncourt's user avatar
1 vote
1 answer
50 views

Does conversion of paper US I bonds to electronic form reduce the limit on electronic I bond purchases in the same year?

Currently, in the USA, an individual can purchase up to $10,000 in electronic Series I ("inflation-protected") bonds in a given year, plus up to $5,000 in paper I bonds. The latter can only ...
sdenham's user avatar
  • 113
2 votes
1 answer
1k views

Is the yield of a 30-year bond, issued 29 years ago and maturing in 1 year, equivalent to that of a 1-year bond maturing on the same date?

The question assumes both bonds are US Treasury bonds. I'm seeking clarity on whether the difference in original issuance date and remaining time to maturity impacts yield parity between these bonds. ...
StatsScared's user avatar
2 votes
0 answers
161 views

Why would a company be "required" to hold bonds in Europe?

I was just watching an old recording of one of Berkshire Hathaway's shareholder meetings and Charlie Munger made a statement about being "required" to hold bonds in Europe. Why would they ...
jesse_b's user avatar
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0 answers
39 views

Choosing government bonds of similar maturity to hold to maturity, shall I just go for the highest YTM one

I wanted to buy some government bonds of roughly 3yrs to maturity and planned to hold it to maturity. My bank's app showed 3 bonds of that maturity but one is 0.1 percentage points higher in YTM. Is ...
jf328's user avatar
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1 vote
1 answer
142 views

How can TIPS have negative real yields?

In this Investopedia explainer about TIPS, it says: The yields on TIPS are often negative. This is because after taking into account the effects of inflation, the real yield is negative. For instance,...
SuperElectric's user avatar
0 votes
3 answers
351 views

Risks of leveraged government bonds

Given that Treasury bills are theoretically assumed to be risk-free investments (not going into whether they really are or not), is there any reason anyone who is planning on keeping the bonds until ...
kenod's user avatar
  • 3
0 votes
1 answer
134 views

Risk of bonds bought on the primary and the secondary markets respectively

Let's suppose investor 'A' buys $100,000 of US inflation-linked treasury bonds, and that investor 'B' buys $100,000 of an ETF that tracks the exact same type of TIPS. Let's suppose that, after ten ...
Martel's user avatar
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1 vote
1 answer
194 views

Why is the price of a 1 year to maturity bond so high?

I am looking at the 2½% Index-linked Treasury Stock 2024 bond and I can't understand why its price is so high (£377). There is only a year left!
Medan's user avatar
  • 563
3 votes
1 answer
292 views

Can I buy I-bonds with my tax refund, as a non-resident?

I want to own American I bonds, but I'm not a US citizen/resident so I don't have a SSN (I live in Canada). As such, I can't just create a TreasuryDirect account and buy I bonds there. Here's my plan: ...
iter's user avatar
  • 133
1 vote
2 answers
254 views

Can I deduct defaulted Treasury bonds from my taxes owed

I purchase a U.S. Treasury bond. If the government doesn't repay it, may I deduct the face value of the bond from my income tax payment?
Clint Eastwood's user avatar
4 votes
3 answers
1k views

How does a rollover work with Bonds?

I understand how a rollover works with personal loans. An easy example would be a car. Someone wants to buy a new car, but they still have an outstanding balance on their current vehicle. So the ...
troy beckett's user avatar
1 vote
0 answers
47 views

How can Yield to Worst be close to Yield to Maturity on 10 Year Agency Bonds that are Continously Callable

For instance, this FFCB bond (3133EN4Q0). Right now, YtM and YtW are quoted to me (fidelity and schwab) as about 15 basis points (if I'm calculating basis points correctly: 5.83 versus 5.69). If YtW ...
chad's user avatar
  • 121
5 votes
1 answer
537 views

What's the real yield on this bond?

I've never bought bonds before and I'm looking into US Treasuries. The 3mo treasury below is described as having a ~4.9% yield. How is this number derived? To me, it looks like if I buy this note with ...
Max's user avatar
  • 151
-4 votes
2 answers
407 views

Why aren't Treasury bill auction reopenings marked as reopenings on the Treasury Auction Schedule?

Let's consider on the 13-week bill whose auction date is Monday, March 13, 2023 on Treasury Tentative Auction Schedule. It's not marked as a reopening on the Treasury Tentative Auction Schedule (no R ...
Franck Dernoncourt's user avatar
-6 votes
1 answer
146 views

What part of the auction process for U.S. Treasuries makes it impossible to enroll in the auto-rollover feature after the initial order entry?

When trying to activate auto-rollover for an already purchased Treasury security on Schwab, I get the message: This security is ineligible for auto-rollover. Due to the nature of the auction process ...
Franck Dernoncourt's user avatar
2 votes
0 answers
39 views

How should I structure Series I Savings Bond accounts and registrations for a family of 3?

I have bought the max 10k allowed for each of us, for a total of 30k. Right now, I have a separate account for myself and my wife, with the bond registration for ourself and the other person. My Name ...
Andrew's user avatar
  • 121
2 votes
0 answers
198 views

The interest rate of a (U.S. Treasury) "Floating Rate Note" (FRN)

I am having trouble to reproduce the calculation of the interest rate of a (U.S. Treasury) "Floating Rate Note" (FRN). Can you help me to find my error? The calculation is described here: ...
311411's user avatar
  • 245
0 votes
1 answer
139 views

Investing in US treasury bonds

I would like to put my money in the safe investment but I would like to earn more than regular savings account has to offer. But I would like to understand the mechanics of it for a regular investor. ...
Medan's user avatar
  • 563
1 vote
1 answer
178 views

Why did SHY ETF only drop 5% YTD but IEF dropped 15% when yield curve is inverted

I don't understand the pricing of these two ETFs. I understand the effect of duration risk, thus, making IEF more volatile but this explanation would contradict with the inverting yield curve. In ...
Kaguya Ōtsutsuki's user avatar
3 votes
2 answers
477 views

Why do government bonds prices fluctuate? [duplicate]

I've heard that bond yields go up if interest rates also go up, which to me makes sense for corporate bonds since if interest rates go up company prices could fall since people spend less and ...
Linkin's user avatar
  • 713
2 votes
1 answer
699 views

Accidentally bought I Savings Bond for $20,000 and TreasuryDirect hasn't credit extra money

Signed up for TreasuryDirect.gov and added myself and my spouse as registrants: Purchased 20,0000$ of I Savings Bond on 04/25/2022: I received an email next day saying below but still haven't ...
javanoob's user avatar
  • 335
12 votes
3 answers
2k views

Why does the yield on SHY (US treasury bond ETF) seem so bad?

With the US interest rate increasing so much lately, I am interested in putting some more of my money into US treasury bonds. I am looking at the SHY ETF on Fidelity, which is an ETF comprising short-...
Time4Tea's user avatar
  • 695
2 votes
0 answers
48 views

Does the yield spread between inflation-indexed bonds and regular bonds overestimate inflation expectations?

Inflation expectations can be determined from the yield spread between inflation-indexed bonds and non-inflation-indexed bonds. For example, US inflation expectations for the next 5 years can be ...
Flux's user avatar
  • 17.1k
7 votes
1 answer
778 views

Is the US market really expecting less than 3% yearly inflation over the next 5 years?

Several people in my family are fearful of upcoming high inflation, perhaps due to the relatively high US inflation figures reported in the last few months (8%+). They think that the US inflation rate ...
Flux's user avatar
  • 17.1k
1 vote
1 answer
86 views

Yield curve to price bonds

I am having a hard time finding books/materials that would teach yield curve pricing using real-world problems/examples I would like to understand if can I use the below treasury yield data (I believe ...
Skittles's user avatar
2 votes
1 answer
81 views

I bonds interest calculation

Current I bond annualized rate is 6.89%. How much interest will accrue in the next 6 months on a $10,000 purchase. Note 6.89% is not what will be earned in a year since the next 6 months will have a ...
Jim G's user avatar
  • 21
1 vote
2 answers
116 views

How many series I savings bonds can you buy at 9.62%?

I know the cap is $10,000 but it looks like you can put $10,000 in for each family member. Can you also do it for an LLC or Trust fund?
user14984433's user avatar
3 votes
1 answer
768 views

Can one buy I bonds within an HSA (Health Savings Account)?

I read: You can’t buy I bonds within an IRA or employer-sponsored savings plan, such as a 401(k) plan. You’ll need to buy I bonds with money that you didn’t save in these programs. Can one buy I ...
Franck Dernoncourt's user avatar
1 vote
1 answer
170 views

1 year T-bill for buying a car in Europe

I live in Europe and I plan to buy a car exactly one year from now. I want to invest now approx. 32000 EUR in 1 year bonds to profit from the interest rate and to secure my money until I need it. My ...
MrRobot's user avatar
  • 135
-3 votes
1 answer
152 views

Why is the purchase of US I bond only possible for US citizens/residents and US civilian employees?

I read on https://www.treasurydirect.gov/indiv/research/indepth/ibonds/res_ibonds_ibuy.htm: Who may own an I bond? Individuals: Yes, if you have a Social Security Number and meet any one of these ...
Franck Dernoncourt's user avatar
1 vote
1 answer
2k views

TreasuryDirect Reinvest T-Bills (Gap or no Gap)

When you set a T-Bill (say 3M) to reinvest on TreasuryDirect, will there be a one week gap when reinvesting (due to auction scheduling) or will you be fully vested for 2 years (get 2 year's worth of ...
kfmfe04's user avatar
  • 297
8 votes
4 answers
9k views

Can I convert interest income to capital gains by selling t-bills before maturity?

I've been buying 6-month treasury bills. The interest is taxed at maturity as interest income. If however it could be taxed as short-term capital gains, I could avoid paying any taxes on it because I ...
Kyle's user avatar
  • 181
3 votes
1 answer
97 views

Where are the prices of secondary market TIPS trades?

The primary market prices for Treasury Inflation-Protected Securities (TIPS) can be found on TreasuryDirect's Auction Results webpage. But where can I find the prices for secondary market trades? Does ...
Flux's user avatar
  • 17.1k
2 votes
1 answer
276 views

What is the correct formula for Bond Yield?

Taking an introductory investment course, was following up on bond yields. I thought the yield is calculated as follows (sorry for some reason LaTex formatting doesn't work - so inserting an image): ...
hba's user avatar
  • 177
3 votes
0 answers
383 views

How to buy I bond for child and spouse?

To purchase I bond I followed the steps below: Opened TreasuryDirect account using my SSN and other information. Purchased a I Bond under my registration. Created a new Primary Owner registration ...
LP13's user avatar
  • 171
1 vote
0 answers
45 views

Need help understanding bond yield outliers

I was looking at bond yields on Fidelity and noticed a few outliers. The tables below show the 'Highest' and 'Median' yields. Note the outliers - Agency/GSE 10yr and Corp AAA 2yr - where the highest ...
hojusaram's user avatar
  • 111
0 votes
0 answers
69 views

What type of account is used for individuals to trade government issued bonds directly with Treasury?

Here is my understanding - an account at a financial institution that allows an individual to trade corporate bonds is a brokerage account. Here is my question - an account held by an individual at ...
knot22's user avatar
  • 161
3 votes
1 answer
222 views

Why is there a sell off of US bonds if interest rates in the US are currently rising?

My understanding is that as interest rates go up, the yield offered by bonds also increases (in response). If the yield of bond increases, then why are people selling bonds?
StatsScared's user avatar
1 vote
2 answers
119 views

Market risk for TIPs vs. I Bonds

Treasury Direct has a good comparison between TIPs and I Bonds: https://www.treasurydirect.gov/indiv/products/prod_tipsvsibonds.htm However, I want to make sure I understand when you can lose ...
public wireless's user avatar
19 votes
4 answers
4k views

How Is There A Yield Curve For Treasuries?

Why would anyone buy a 1 yr T-Bill with a return of 1.25% when you get double that on a 30-year T-Bond? Where is the risk and/or liquidity premium coming from? There's a highly liquid, secondary ...
EricP's user avatar
  • 293
0 votes
1 answer
108 views

How is price of 1 year Treasury Bills calculated on this chart?

The chart shows USD 0.85. I assume it is per USD 1000 face value T-Bill. What does this USD 0.85 mean?
user3156459's user avatar
3 votes
1 answer
160 views

Why is the price of 10-year note different for the same yield?

Looking at the price of 10-year note (ZN) futures, I noticed that the price of ZN futures corresponding to ~1.70% yield was ~128 today but was ~131 in March 2021. Why is there such a huge difference ...
fineTuneFork's user avatar
1 vote
0 answers
73 views

What does it mean to say a market is governed by technicals

In an interview, Mohamed El-Erian had this to say about the current situation for global bond funds: I’m really glad I’m no longer managing fixed income bond funds because technicals rather than ...
Arash Howaida's user avatar
2 votes
0 answers
91 views

Why do we have *daily* series of T-bill yields?

I understand that each week the US Treasury issues new T-bills at different maturities (1-month, 3-months, 1-year, etc). As far as I understand, this issuance happens every Tuesday. After the auction, ...
Raul Guarini Riva's user avatar