Buying bonds on Fidelity

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RationalWalk
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Buying bonds on Fidelity

Post by RationalWalk »

I used to be with Vanguard but moved my accounts to Fidelity. Want to buy 23 TIPs. With Vanguard, you put in your order and that was it. The price was apparently determined by the Vanguard platform. I never had a bond order that wasn't filled. On Fidelity you are shown an array of bid prices and you can select the one you want, or I guess you can put in any bid yourself. A bid price appears in the field which is one of the options shown. I don't know how to handle the scenario. I've just gone with the bid price that's filled in by Fidelity and have had 2 tries rejected. Can someone guide me how to do this to get the transaction completed at the best price? Thanks.
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bombcar
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Re: Buying bonds on Fidelity

Post by bombcar »

Call Fidelity and ask? Their support is usually pretty good.

Did it give a reason why it didn’t go through?
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RationalWalk
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Re: Buying bonds on Fidelity

Post by RationalWalk »

bombcar wrote: Tue Jul 09, 2024 12:30 pm Call Fidelity and ask? Their support is usually pretty good.

Did it give a reason why it didn’t go through?
No. I'm assuming the bid was too low for the amount I was purchasing.
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PersonalFinanceJam
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Re: Buying bonds on Fidelity

Post by PersonalFinanceJam »

This happens sometimes especially with TIPS bought on the secondary market which can be quite volatile in price. First things first, Fidelity will show you a list of prices and the minimum quantity you need to purchase to achieve that price. If you don't put in at least that amount then you will get rejected. The next reason it could get rejected is because the prices and quantities have moved since you loaded the screen. Refresh the screen using your browsers refresh button to get updated information.

On one particularly volatile day I was having a problem getting my order filled for TIPS and just did it the next day when things calmed down.
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bd7
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Re: Buying bonds on Fidelity

Post by bd7 »

If I'm thinking of the screen you are looking at, the "bid" price represents the highest buyer bid and the "ask" price represents the lowest seller ask. Note the minimum volume and max availability for each as sometimes you will have to go further down the order book at a slightly worse price to find a seller offering an appropriate volume. If you bid the "bid" price, you typically won't get a bite, but if you enter the "ask" price you'll typically have the deal go through. You can also try to put in a price in the middle of the spread and you'll often save a few nickels that way.
JayB
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Re: Buying bonds on Fidelity

Post by JayB »

RationalWalk wrote: Tue Jul 09, 2024 12:29 pm I used to be with Vanguard but moved my accounts to Fidelity. Want to buy 23 TIPs. With Vanguard, you put in your order and that was it. The price was apparently determined by the Vanguard platform. I never had a bond order that wasn't filled. On Fidelity you are shown an array of bid prices and you can select the one you want, or I guess you can put in any bid yourself. A bid price appears in the field which is one of the options shown. I don't know how to handle the scenario. I've just gone with the bid price that's filled in by Fidelity and have had 2 tries rejected. Can someone guide me how to do this to get the transaction completed at the best price? Thanks.
~ Dumb & Dumber
When you click at Fidelity on the Buy button, you will be shown an array of bid and ask prices. Since you are trying to purchase TIPS, you should only be paying attention to ask prices; bid prices would be of interest if you are selling an existing holding. All you need to do is to enter the quantity of TIPS you want in the Quantity box; the quoted limit ask price will adjust to be the best available for your desired quanitity when you preview the order. Fidelity software will usually reject any ask Limit Price if you try to specify your own, so don't fiddle with the entry in this box --- just accept what is listed and hit Preview Order. Now Fidelity's bond site is finicky with Treasury bonds/TIPS and will sometimes (or often) reject an order when you hit Preview Order or Place Order because the market has moved away from what was quoted. In effect, the quotes that Fidelity provides are often stale by the time they are displayed; this is a known problem. If your order is rejected, simply try again (possibly several times) and be patient, allowing the Fidelity software to update the Limit Price slightly. It usually works for me after 1-5 tries. If an order doesn't fill after about 5 minutes, I usually cancel it and try again. If the retries all fail, call the bond desk, explain your situation, and they can usually place the order at no extra charge to you.
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RationalWalk
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Re: Buying bonds on Fidelity

Post by RationalWalk »

JayB wrote: Tue Jul 09, 2024 3:46 pm
RationalWalk wrote: Tue Jul 09, 2024 12:29 pm I used to be with Vanguard but moved my accounts to Fidelity. Want to buy 23 TIPs. With Vanguard, you put in your order and that was it. The price was apparently determined by the Vanguard platform. I never had a bond order that wasn't filled. On Fidelity you are shown an array of bid prices and you can select the one you want, or I guess you can put in any bid yourself. A bid price appears in the field which is one of the options shown. I don't know how to handle the scenario. I've just gone with the bid price that's filled in by Fidelity and have had 2 tries rejected. Can someone guide me how to do this to get the transaction completed at the best price? Thanks.
~ Dumb & Dumber
When you click at Fidelity on the Buy button, you will be shown an array of bid and ask prices. Since you are trying to purchase TIPS, you should only be paying attention to ask prices; bid prices would be of interest if you are selling an existing holding. All you need to do is to enter the quantity of TIPS you want in the Quantity box; the quoted limit ask price will adjust to be the best available for your desired quanitity when you preview the order. Fidelity software will usually reject any ask Limit Price if you try to specify your own, so don't fiddle with the entry in this box --- just accept what is listed and hit Preview Order. Now Fidelity's bond site is finicky with Treasury bonds/TIPS and will sometimes (or often) reject an order when you hit Preview Order or Place Order because the market has moved away from what was quoted. In effect, the quotes that Fidelity provides are often stale by the time they are displayed; this is a known problem. If your order is rejected, simply try again (possibly several times) and be patient, allowing the Fidelity software to update the Limit Price slightly. It usually works for me after 1-5 tries. If an order doesn't fill after about 5 minutes, I usually cancel it and try again. If the retries all fail, call the bond desk, explain your situation, and they can usually place the order at no extra charge to you.
Thank you for your help. I was able to get the bond purchase through after reading your post.
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dogagility
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Re: Buying bonds on Fidelity

Post by dogagility »

RationalWalk wrote: Tue Jul 09, 2024 12:29 pm I've just gone with the bid price that's filled in by Fidelity and have had 2 tries rejected. Can someone guide me how to do this to get the transaction completed at the best price?
The orders are usually filled... but not always. Just need to keep trying.

If you want a step by step guide, here's a video. https://www.youtube.com/watch?v=coERtUZH0ew
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RationalWalk
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Re: Buying bonds on Fidelity

Post by RationalWalk »

dogagility wrote: Wed Jul 10, 2024 11:12 am
RationalWalk wrote: Tue Jul 09, 2024 12:29 pm I've just gone with the bid price that's filled in by Fidelity and have had 2 tries rejected. Can someone guide me how to do this to get the transaction completed at the best price?
The orders are usually filled... but not always. Just need to keep trying.

If you want a step by step guide, here's a video. https://www.youtube.com/watch?v=coERtUZH0ew
Oh, that's great. I bookmarked the video to view. Thanks.
“Meteorologists” are the MOST accurate predictors of the future -- for the next 3-days...
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