Curious if anyone is planning on buying the 20 year bonds this upcoming auction. From my understanding, the final rate is based of the competitive bids which is in close relation to any 20 year Tresury index fund (US:20Y) (4.56% currently) of a brokage of your choice. "The Snap" price.
Not saying this is the always the case, you could have a "Tail" weaker demand and get a better rate. Or you cold get a "Stop Through" higher demand and get a less desirable rate.
My questions are;
Do I have an understanding how the auction works?
What is the difference between this upcoming auction dated 2-21-2024 (20 year) vs 3-19-2024 (19 year 11 month) vs 4-17-2024 (19 year 10 month)? Is it just hoping to get a slightly better rate?
The Fed metting in May, might mention Cuts, but these are before that, so again is it just hopes it goes up, and it's worth waiting the month or 2 in hopes of that?
Also noticed if you use a broker the rate is about 25 basis points off, is that just the broker's cut for making it simple to order? I don't see why anyone wouldn't just buy direct from the Treasury website and get the full rate awarded.
Happy investing everyone :)
Submitted February 17, 2024 at 11:35PM by JohnnyBravo_008 https://ift.tt/IrU3Xxm
