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Started By
Message
re: 2yr Treasury Nearly 4 Percent
Posted on 9/17/22 at 4:04 pm to Niner
Posted on 9/17/22 at 4:04 pm to Niner
quote:
There are better HY savings accounts than this right now (all FDIC insured). Bask Bank 2.53% CIBC 2.32% My Banking Direct 2.2% Brio Direct 2.15% Lending Club 2.15% CIT Bank 2.1% Citizens 2.1% Synchrony 2.05% Barclays 2%
Save Better is pretty competitive. I'm in a 2.75% high yield saving account and a 3% no penalty CD (can only withdraw the whole balance). And other competitive products pop up on there all the time. It's a custodial bank that's FDIC insured. Allows you to easily move your money into different products when the rates rise without having to make a new account.
0
Posted on 9/17/22 at 7:22 pm to Realityintheface
quote:
Don’t even know why I post in the MT.
Me either.
Posted on 9/17/22 at 7:52 pm to Realityintheface
Plus post, would read again. I love it when people make long posts, professing their superior intelligence, ability, and can’t spell simple words.
Posted on 9/18/22 at 10:23 am to Realityintheface
quote:
You do realize the Feds meet this Tues/Wed? Whatever interest you get off that if you buy now will disappear like a fart in the wind along with some principal when they hike in a few days. Fact.
You're so out of your league. It's possible you manage money but so does Cathie Woods. Don't forget that.
Posted on 9/18/22 at 12:11 pm to Realityintheface
quote:
You do realize the Feds meet this Tues/Wed? Whatever interest you get off that if you buy now will disappear like a fart in the wind along with some principal when they hike in a few days. Fact.
We aren't talking about bond funds in here. If you hold an individual bond to maturity, you get 100% of the principal back plus the interest regardless of rate changes.
Posted on 9/18/22 at 1:16 pm to gpburdell
quote:
If you hold an individual bond to maturity, you get 100% of the principal back plus the interest regardless of rate changes.
Posted on 9/19/22 at 6:14 am to wutangfinancial
There was an analyst on CNBC last week talking about having a generation of investors that have never dealt with real interest rates or the time value of money. Nice to have bonds as a meaningful investment option again.
Posted on 9/19/22 at 7:45 am to Aubie Spr96
I have 40k that I want to be able to access next July if I need to. Can decide if just stick it in a high yield account or Treasuries.
Posted on 9/19/22 at 8:08 am to Realityintheface
quote:
Do not buy bonds yet. Fed rate will continue to rise and destroy them. Wait till the Feds are done and then buy them.
That’s not really how these short term things work.
Posted on 9/19/22 at 8:10 am to Realityintheface
quote:
Go ahead OP, put your money in a 4% T bill. Good luck.
He’s going to make exactly 4% at maturity and you’re going to be left scratching your head.
Posted on 9/19/22 at 9:21 am to GREENHEAD22
quote:
I have 40k that I want to be able to access next July if I need to. Can decide if just stick it in a high yield account or Treasuries.
I’m not sure what length of maturity you’re looking at with respect to the Treasuries, but you could always divide it between the two categories.
Posted on 9/19/22 at 9:23 am to Aubie Spr96
quote:
There was an analyst on CNBC last week talking about having a generation of investors that have never dealt with real interest rates or the time value of money. Nice to have bonds as a meaningful investment option again.
Treasury bonds are put options that pay you to hold them. Doesn't get much better than that. Some of these on-the-run treasury bonds 20+ duration are going to yield 30-40% on top of the coupon the next few years. Most people don't understand that.
Posted on 9/19/22 at 9:28 am to wutangfinancial
I have a short term spread now of 3 month, 6 month, and 2 yr bonds. As long as rates stay in the 4% range, it makes for a nice rotation for the emergency fund.
Posted on 9/19/22 at 10:00 am to Aubie Spr96
quote:
emergency fund
quote:
2yr time horizon
Posted on 9/19/22 at 5:26 pm to skewbs
Does the next rate hike mean higher treasury yields? If so, how sudden?
Posted on 9/19/22 at 5:37 pm to bayoubengals88
quote:
Does the next rate hike mean higher treasury yields? If so, how sudden?
Depends on the term. The 10-yr peaked in mid June, and then went down like 50 bps while the feds raised rates 1.5%. It’s up again now, but anything after 2 years or so is not going to move based on something we already know.
Even short term rates are impacted in a scaled way. If everyone knows they’ll raise .75% on Wednesday, why would they not consider that in their purchase price today? Bonds on the secondary market are a pretty efficient and fair market - everything we know and think we know is typically priced into the rates.
Posted on 9/19/22 at 5:48 pm to slackster
Thanks, and just double checking, the rate is locked in?
Last thing: loss of principal on a T Note means global economic disaster, right?
Last thing: loss of principal on a T Note means global economic disaster, right?
This post was edited on 9/19/22 at 5:49 pm
Posted on 9/19/22 at 9:38 pm to bayoubengals88
quote:
Thanks, and just double checking, the rate is locked in?
Treasuries are initially sold through auction and the bidding process and other factors determine the rate for each offering. At that point, yes the rate is locked in for the life of the bond. Fyi, auctions are happening every week of the year:
https://home.treasury.gov/system/files/221/Tentative-Auction-Schedule.pdf
https://thefinancebuff.com/treasury-bills-cd-money-market.html
Also, you can buy/sell treasuries in the secondary market just like stocks. The effective rate you will get is set by the market. Fyi, the coupon rate on the bonds themselves don't change; it's the price you pay for each bond that fluctuates.
Most people don't realize, the US Treasury market is the biggest and most liquid market in the world. In 2020, US Treasuries traded an average of over 600 billion per day. During the same year, the stock market averaged 450 billion per day.
quote:
Last thing: loss of principal on a T Note means global economic disaster, right?
Yes that would mean the US defaulted on a govt bond which has never happened. The economic ramifications of that would be severe for the US. Just to be clear; I am referring to loss of principal at maturity.
If you sell a treasury before maturity, you can lose principal if current rates are higher. Vice versa if you sell and rates are lower; you will get more than you paid for it.
This post was edited on 9/19/22 at 9:39 pm
Posted on 9/20/22 at 4:53 pm to Aubie Spr96
I just purchased a credit union share certificate. 9 months at 3.5%
Posted on 9/20/22 at 5:54 pm to Twenty 49
quote:if married, you and your wife can buy $100k this year. Read up on gifting.
They’re great, but there is the $10k a year limit.
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