Differences

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--- treasury_direct_notes [2023/01/19 22:38] – [links I came across] admin
+++ treasury_direct_notes [2023/04/04 14:14] (current) – [treasury bills vs. notes vs. bonds] admin
@@ Line 1: / Line 1: @@
+===== qna =====
+==== treasury bills vs. notes vs. bonds ====
+??? What is the difference between Treasury bills, notes and bonds?
+!!!
+^ ^ Treasury Bills ^ Treasury Notes ^ Treasury Bonds ^
+| term | short-term | short or medium-term | long-term |
+| mature in | one year or less | 2, 3, 5, 7, or 10 years | 20 or 30 years |
+Ref:- https://www.treasurydirect.gov/marketable-securities/understanding-pricing/
+===== methodology related =====
+==== high rate vs. investment rate ====
+??? What is the difference between "high rate" and "investment rate" in https://www.treasurydirect.gov/auctions/announcements-data-results/?
+!!! For bills not more than one half-year to maturity
+<code>
+high_rate = ((100-P) / 100) * (360 / r)
+investment_rate = ((100-P) / P) * (y / r)
+</code>
+Where P is the price, r is days to maturity, y is days in year (365 in normal year, 366 in leap year)
+Ref:-
+  * https://www.treasurydirect.gov/instit/annceresult/press/preanre/2004/ofcalc6decbill.pdf
+  * https://www.bogleheads.org/forum/viewtopic.php?t=252066
+For example, on 2023-01-19, https://www.treasurydirect.gov/auctions/announcements-data-results/ showed
+^ Security Term ^ CUSIP ^ Issue Date ^ Maturity Date ^ High Rate ^ Investment Rate ^
+| 4-week | [[https://www.treasurydirect.gov/auctions/auction-query/?cusip=912796Y60 | 912796Y60]] | 01/24/2023 | 02/21/2023 | 4.480% | 4.558% |
+Clicking on the CUSIP showed
+^ CUSIP ^ Security Type ^ Security Term ^ Auction Date ^ Issue Date ^ Maturity Date ^ Price per $100 ^
+| 912796Y60 | Bill | 4-Week | 01/19/2023 | 01/24/2023 | 02/21/2023 | 99.651556 |
+<code>
+$ ipython
+Python 3.10.8 | packaged by conda-forge | (main, Nov 24 2022, 14:07:00) [MSC v.1916 64 bit (AMD64)]
+IPython 8.7.0 -- An enhanced Interactive Python. Type '?' for help.
+In [1]:
+P = 99.651556; r = 28; y = 365
+In [2]:
+high_rate = ((100-P) / 100) * (360 / r)
+In [3]:
+high_rate
+Out[3]:
+.04479994285714294
+In [4]:
+round(high_rate * 100, 3)
+Out[4]:
+.48
+In [5]:
+investment_rate = ((100-P) / P) * (y / r)
+In [6]:
+investment_rate
+Out[6]:
+.04558098850530179
+In [7]:
+round(investment_rate * 100, 3)
+Out[7]:
+.558
+</code>
+===== dummy =====
 ==== Highlights from https://www.treasurydirect.gov/forms/sec009.pdf ====
   *  bill, note, bond, FRN, and TIPS
@@ Line 4: / Line 76: @@
   * TIPS = Treasury inflation-protected securities
   * 4-week, 8-week, 13-week, 26-week, and 52week bills
+  * For more about entity accounts, see "User Guide 292" - https://www.treasurydirect.gov/indiv/help/treasurydirect-help/user-guide/291-300/#id-user-guide-292-263212
 ==== links I came across ====
+  * https://www.treasurydirect.gov/auctions/how-auctions-work/ - How auctions work
   * https://www.treasurydirect.gov/forms/sec009.pdf - Investing Directly With the U.S. Treasury (FS Publication 009) is an introductory publication.
   * https://www.treasurydirect.gov/indiv/help/treasurydirect-help/user-guide/291-300/ - User guide sections 291 through 300