Picking up Nickels

Tuesday, August 29, 2006

Aug 31 Issue T-Bills: 4 Week Yield (5.32%) Leads the Pack

As I mentioned in an earlier blog entry (T-Bills: An Alternative to CDs), I have been buying 4 week T-Bills in favor of longer term Treasuries until the FOMC meets again on September 20th.

That strategy paid off for me with the auction this week, since the yield for 4 week T-Bills (5.32%) topped both 3 month (5.19%) and 6 month bills (5.24%). Using this handy T-bill tax equivalent yield spreadsheet, I'm happy to see that my tax equivalent yield for this bill will be 5.62%. Hopefully, I will feel the same way when this bill matures in 4 weeks.


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