Trading Treasuries (nominal and TIPS)

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exodusing
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Re: Trading Treasuries (nominal and TIPS)

Post by exodusing »

The new 2035 TIPS are not yet available on Vanguard, although today is listed as the settlement date. Should they be available for regular trading on the settlement date? Perhaps later today? Presumably they will trade on Monday.

Are they available on other platforms? If so, regular or when issued?
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sycamore
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Re: Trading Treasuries (nominal and TIPS)

Post by sycamore »

exodusing wrote: Fri Jan 31, 2025 7:34 am The new 2035 TIPS are not yet available on Vanguard, although today is listed as the settlement date. Should they be available for regular trading on the settlement date? Perhaps later today? Presumably they will trade on Monday.

Are they available on other platforms? If so, regular or when issued?
They're available on Schwab. I saw them there on Monday IIRC, but only three sellers were offering.
rbd789
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Re: Trading Treasuries (nominal and TIPS)

Post by rbd789 »

sycamore wrote: Fri Jan 31, 2025 7:55 am
exodusing wrote: Fri Jan 31, 2025 7:34 am The new 2035 TIPS are not yet available on Vanguard, although today is listed as the settlement date. Should they be available for regular trading on the settlement date? Perhaps later today? Presumably they will trade on Monday.

Are they available on other platforms? If so, regular or when issued?
They're available on Schwab. I saw them there on Monday IIRC, but only three sellers were offering.
I bought some yesterday at Fidelity
hudson
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Re: Trading Treasuries (nominal and TIPS)

Post by hudson »

exodusing wrote: Fri Jan 31, 2025 7:34 am The new 2035 TIPS are not yet available on Vanguard, although today is listed as the settlement date. Should they be available for regular trading on the settlement date? Perhaps later today? Presumably they will trade on Monday.

Are they available on other platforms? If so, regular or when issued?
I just checked to see if I could buy some CUSIP: 91282CML2. I think that's the one you are asking about.
Bids appeared but no Asks.
exodusing
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Re: Trading Treasuries (nominal and TIPS)

Post by exodusing »

hudson wrote: Fri Jan 31, 2025 9:15 am
exodusing wrote: Fri Jan 31, 2025 7:34 am The new 2035 TIPS are not yet available on Vanguard, although today is listed as the settlement date. Should they be available for regular trading on the settlement date? Perhaps later today? Presumably they will trade on Monday.

Are they available on other platforms? If so, regular or when issued?
I just checked to see if I could buy some CUSIP: 91282CML2. I think that's the one you are asking about.
Bids appeared but no Asks.
That's the one. January 2035 2.25%. Bid but no ask would appear to mean they'll buy but not sell.

Still not available on Vanguard, either bid or ask.
hudson
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Re: Trading Treasuries (nominal and TIPS)

Post by hudson »

exodusing wrote: Fri Jan 31, 2025 9:47 am
hudson wrote: Fri Jan 31, 2025 9:15 am

I just checked to see if I could buy some CUSIP: 91282CML2. I think that's the one you are asking about.
Bids appeared but no Asks.
That's the one. January 2035 2.25%. Bid but no ask would appear to mean they'll buy but not sell.

Still not available on Vanguard, either bid or ask.
Vanguard is where I saw it.
exodusing
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Re: Trading Treasuries (nominal and TIPS)

Post by exodusing »

rbd789 wrote: Fri Jan 31, 2025 8:43 am
sycamore wrote: Fri Jan 31, 2025 7:55 am
They're available on Schwab. I saw them there on Monday IIRC, but only three sellers were offering.
I bought some yesterday at Fidelity
That must have been when issued, as they don't settle until today. Interesting that they have when issued trading but Vanguard doesn't, at least on the web site platform.
exodusing
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Re: Trading Treasuries (nominal and TIPS)

Post by exodusing »

hudson wrote: Fri Jan 31, 2025 9:48 am
exodusing wrote: Fri Jan 31, 2025 9:47 am
That's the one. January 2035 2.25%. Bid but no ask would appear to mean they'll buy but not sell.

Still not available on Vanguard, either bid or ask.
Vanguard is where I saw it.
Where on Vanguard? When I go to Vanguard bonds & cds and specify TIPS maturing 2034 - 2036 all I see is the 2034s.

EDIT: If I search by CUSIP I see them. As you wrote, you can sell but not buy. Coupon is 2.125, not 2.25 as I wrote (from #Cruncher's spreadsheet).
Last edited by exodusing on Fri Jan 31, 2025 9:56 am, edited 1 time in total.
hudson
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Re: Trading Treasuries (nominal and TIPS)

Post by hudson »

I searched by CUSIP. Maybe Monday?
exodusing
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Re: Trading Treasuries (nominal and TIPS)

Post by exodusing »

hudson wrote: Fri Jan 31, 2025 9:55 am I searched by CUSIP. Maybe Monday?
Most probably.
protagonist
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Re: Trading Treasuries (nominal and TIPS)

Post by protagonist »

exodusing wrote: Fri Jan 31, 2025 9:50 am
hudson wrote: Fri Jan 31, 2025 9:48 am

Vanguard is where I saw it.
Where on Vanguard? When I go to Vanguard bonds & cds and specify TIPS maturing 2034 - 2036 all I see is the 2034s.

EDIT: If I search by CUSIP I see them. As you wrote, you can sell but not buy. Coupon is 2.125, not 2.25 as I wrote (from #Cruncher's spreadsheet).
2035s are for sale now on Fido at 2.122%

Price 100.023

I am in no hurry to buy them since I am just planning to use existing 2034s and 2040s, so my rate is already locked in.
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Kevin M
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Re: Trading Treasuries (nominal and TIPS)

Post by Kevin M »

sycamore wrote: Fri Jan 31, 2025 7:55 am
exodusing wrote: Fri Jan 31, 2025 7:34 am The new 2035 TIPS are not yet available on Vanguard, although today is listed as the settlement date. Should they be available for regular trading on the settlement date? Perhaps later today? Presumably they will trade on Monday.

Are they available on other platforms? If so, regular or when issued?
They're available on Schwab. I saw them there on Monday IIRC, but only three sellers were offering.
They were available at Schwab on Fri Jan 24, the day after the auction, as I posted earlier in this thread.

By "three sellers were offering", I assume you mean that you saw three ask quotes in the depth of book. Doesn't really matter, as long as the ask yield is competitive, which it was when I first saw it a week ago. Of course the quantity and min qty also matter, but I didn't check those.
If I make a calculation error, #Cruncher probably will let me know.
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Kevin M
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Re: Trading Treasuries (nominal and TIPS)

Post by Kevin M »

exodusing wrote: Fri Jan 31, 2025 9:49 am
rbd789 wrote: Fri Jan 31, 2025 8:43 am I bought some yesterday at Fidelity
That must have been when issued, as they don't settle until today. Interesting that they have when issued trading but Vanguard doesn't, at least on the web site platform.
Yes, "when issued" as I explained on the previous page of this thread. Schwab offered it the day after the auction (with 1/31 settlement), and apparently Fidelity offered it yesterday, when settlement would be the typical T+1 on secondary.
If I make a calculation error, #Cruncher probably will let me know.
exodusing
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Re: Trading Treasuries (nominal and TIPS)

Post by exodusing »

Vanguard is now offering the 2035 TIPS, both buy and sell. They may be found searching by date, not just CUSIP, as they were if you wanted to sell on Friday. As far as I could tell, they never offered when issued trading on their web site, as apparently did Schwab and Fidelity.
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frugalNOTcheap
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Re: Trading Treasuries (nominal and TIPS)

Post by frugalNOTcheap »

I sold my excess January 2034 TIPS that were slated for the 2035 wrung on Friday. The sell YTM was 2.095% and buy YTM was 2.123% (at Schwab). This seems like a fairly efficient trade, do others agree?
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Re: Trading Treasuries (nominal and TIPS)

Post by Kevin M »

frugalNOTcheap wrote: Mon Feb 03, 2025 6:53 pm I sold my excess January 2034 TIPS that were slated for the 2035 wrung on Friday. The sell YTM was 2.095% and buy YTM was 2.123% (at Schwab). This seems like a fairly efficient trade, do others agree?
Sure. I focus more on the price bid/ask, since that's what directly affects your trading costs. When I pulled quotes from Schwab a little while ago, the ask and bid prices were 97.41317 and 97.37900, which is a spread of 0.035%, and I figure the seller pays half, so less than 2 basis points. The yields were 2.068 and 2.073, so a yield spread of half a basis point.

Of course these spreads depend on the minimum quantities relative to the quantity you're selling, but I see for the min qty for all 2034s is 1 at Schwab today.

Here are the price and yield bid/ask spreads at Schwab for all TIPS.

Image

Note that the bid/ask for the Jul 2025 is negative for some reason. Last week I saw negative bid/ask spreads for some of the longer maturity TIPS. I assume that in these cases the bid and ask are from different sources, and there's a temporary market inefficiency.
If I make a calculation error, #Cruncher probably will let me know.
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Re: Trading Treasuries (nominal and TIPS)

Post by bikechuck »

Stubbie wrote: Mon Feb 12, 2024 10:08 am I have been building a TIPS ladder for the past 2 years and have read the pros and cons of the different strategies for filling the gap years of 2035 through 2039. Since, depending on inflation, TIPS and nominals have historically traded off on being the more advantageous investment, has anyone just gone ahead and filled those gap years with STRIPS? My thought is to buy the newly issued TIPS each year using the proceeds from the already owned STRIPS for that corresponding year. Perhaps the relatively short holding period of the STRIPS would soften any huge difference in the TIPS and STRIPS return over that period of time?
At some point in my financial management career I had a boss that drove home the point that it was far better to be approximately right rather than precisely wrong. I also came to believe that perfection is the enemy of the good.

With this in mind I created my TIPS ladder with nearly equal rungs that (excluding interest and in conjunction with SS) will provide me with enough inflation protected income to meet all of my mandatory expenses and some of my discretionary expenses through age 88. I have doubled up the size of the rungs in 2026 - 2029 and as the rungs mature I will spend half and invest the other half in ten year 2036 -2039 TIPS when they are issued.

Is my approach optimal ? Probably not
Is my approach reasonable ? I think so especially since my TIPS ladder is only 18% of my portfolio

I like the simplicity of the approach that I have taken.
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10 YEAR TIPS Auction March 20, 2025, Re-opening for 91282CML2

Post by hudson »

I think that I mostly understand what's quoted below from Treasury Direct.
I'll be buying from Vanguard in a taxable account.
What else is there to know?
What about just buying 91282CML2 on the secondary market ahead of the auction?
Or buying a different TIPS?

From Treasury Direct, I think for CUSIP 91282CML2
Announce: Mar. 13
Auction: Mar. 20
Settlement: Mar. 31
When we hold a reopening auction, we are selling additional amounts of a previously issued security.

The reopened security has the same CUSIP number, maturity date, and interest rate or spread as the original security, but it has a different issue date and usually a different price.

As with any Treasury auction, the price for a reopened security is decided by the auction. If the price is more than the par value of the security, you pay a premium.

Sometimes, with a reopened security, you may have to pay accrued interest. If this is the case, you get that interest back with the first regular interest payment for that security.

If you bid in a reopening, check after the auction to see if you owe a premium or accrued interest or both. By the issue date, you must have the necessary funds in your account to pay for the security.
Rajsx
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Re: Trading Treasuries (nominal and TIPS)

Post by Rajsx »

If I buy Tips I will try to buy with Fidelity Brokerage Platform, I am not going back to the Treasury Direct Website.
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Re: Trading Treasuries (nominal and TIPS)

Post by LadyGeek »

I moved a question by pjddjp007 and several replies into the relevant thread. See: Re: What's up (or down) with TIPS?

(Thanks to the member who reported the post and explained what's wrong.)
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Kevin M
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Re: 10 YEAR TIPS Auction March 20, 2025, Re-opening for 91282CML2

Post by Kevin M »

hudson wrote: Thu Feb 06, 2025 8:57 am I think that I mostly understand what's quoted below from Treasury Direct.
I'll be buying from Vanguard in a taxable account.
What else is there to know?
What about just buying 91282CML2 on the secondary market ahead of the auction?
Or buying a different TIPS?

From Treasury Direct, I think for CUSIP 91282CML2
Announce: Mar. 13
Auction: Mar. 20
Settlement: Mar. 31
This is the Jan 2035 10-year TIPS, first issued last month. The other 10-year new issues tentatively are auctioned in July. Reopenings for the 10y typically occur in March, May, September, November.

The coupon is fixed at the initial offering, but the yield and price at reopenings are determined by the auction. The main advantages of auctions is that there is no bid/ask spread, and everyone gets the same price, regardless of quantity purchased. They yield typically will be close to that of the same or similar TIPS on secondary at the time of the auction.

I buy almost all of my TIPS in the secondary market, as I like being able to buy when the yield appears attractive (yes, market timing), I like knowing what yield I'm getting, and I like the T+1 settlement; the settlement delay is longer for auctions--e.g., for the March reopening, auction is on March 20 and settlement is on March 31.

There is no other TIPS maturing in 2035, so if you want a TIPS maturing in 2035, this is your only option until the July 2035 is issued in July. I don't know why you'd buy another TIPS if you want one maturing in 2035.
If I make a calculation error, #Cruncher probably will let me know.
exodusing
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Re: Trading Treasuries (nominal and TIPS)

Post by exodusing »

What's a reasonable minimum number of bonds or market value that you'd sell if you wanted to reallocate parts of your portfolio (or would you use some other metric, such as a percentage of holdings)? My specific case is I have some extra TIPS in parts of my ladder (more than I need to achieve the desired cash flow) and some other parts that could be increased. Very small amounts are not worth moving and would also likely cost more in bid-ask spreads than larger quantities.

In any event, what's a good rule of thumb for a minimum amount of TIPS to sell in order to buy others?
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Re: 10 YEAR TIPS Auction March 20, 2025, Re-opening for 91282CML2

Post by hudson »

Kevin M wrote: Fri Feb 07, 2025 1:51 pm buy almost all of my TIPS in the secondary market, as I like being able to buy when the yield appears attractive (yes, market timing), I like knowing what yield I'm getting, and I like the T+1 settlement; the settlement delay is longer for auctions--e.g., for the March reopening, auction is on March 20 and settlement is on March 31.

There is no other TIPS maturing in 2035, so if you want a TIPS maturing in 2035, this is your only option until the July 2035 is issued in July. I don't know why you'd buy another TIPS if you want one maturing in 2035.
Thanks Kevin M!
I'm going to buy some 2035s in March. I'll look hard at the secondary market before the Ides of March and decide.
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Kevin M
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Re: Trading Treasuries (nominal and TIPS)

Post by Kevin M »

exodusing wrote: Fri Feb 07, 2025 4:17 pm What's a reasonable minimum number of bonds or market value that you'd sell if you wanted to reallocate parts of your portfolio (or would you use some other metric, such as a percentage of holdings)? My specific case is I have some extra TIPS in parts of my ladder (more than I need to achieve the desired cash flow) and some other parts that could be increased. Very small amounts are not worth moving and would also likely cost more in bid-ask spreads than larger quantities.

In any event, what's a good rule of thumb for a minimum amount of TIPS to sell in order to buy others?
It depends on the broker and the particular time you look. Schwab often has best pricing for min quantity 1, and often when the min qty is higher, the min qty 1 pricing is almost as good. However, I've bought and sold TIPS on days when the small quantity pricing was not as good as usual. When I pulled quotes today at Schwab, most TIPS had best price for min qty 1 for both bid and ask, but some best price min quantities were higher, like 200, 40 or 65.

I saw it mentioned that Fidelity has recently had best TIPS prices for min qty 5, but typically it has had best pricing for much larger quantities.

I haven't looked at Vanguard in a long time, but in the best their small quantity pricing was not nearly as good as larger quantity pricing.
If I make a calculation error, #Cruncher probably will let me know.
exodusing
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Re: Trading Treasuries (nominal and TIPS)

Post by exodusing »

Kevin M wrote: Fri Feb 07, 2025 6:18 pm
exodusing wrote: Fri Feb 07, 2025 4:17 pm What's a reasonable minimum number of bonds or market value that you'd sell if you wanted to reallocate parts of your portfolio (or would you use some other metric, such as a percentage of holdings)? My specific case is I have some extra TIPS in parts of my ladder (more than I need to achieve the desired cash flow) and some other parts that could be increased. Very small amounts are not worth moving and would also likely cost more in bid-ask spreads than larger quantities.

In any event, what's a good rule of thumb for a minimum amount of TIPS to sell in order to buy others?
It depends on the broker and the particular time you look. Schwab often has best pricing for min quantity 1, and often when the min qty is higher, the min qty 1 pricing is almost as good. However, I've bought and sold TIPS on days when the small quantity pricing was not as good as usual. When I pulled quotes today at Schwab, most TIPS had best price for min qty 1 for both bid and ask, but some best price min quantities were higher, like 200, 40 or 65.

I saw it mentioned that Fidelity has recently had best TIPS prices for min qty 5, but typically it has had best pricing for much larger quantities.

I haven't looked at Vanguard in a long time, but in the best their small quantity pricing was not nearly as good as larger quantity pricing.
Just to be clear, would you trade based on the bid-asked spread compared to larger quantities (both on the buy and sell side), rather than some rule of thumb, such as it not being worthwhile to reallocate a ladder if you were moving, for example, fewer than ten TIPS?
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