Treasury Bond Buying Tutorial

Discussion of the Bond portion of the Permanent Portfolio

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sophie
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Re: Treasury Bond Buying Tutorial

Post by sophie » Tue Jul 03, 2018 7:52 am

Selling Treasuries can be a bit complicated and it depends on where you're holding them.

Treasury Direct: you can't sell them on the site. You have to transfer them to a brokerage account and then sell. I've never tried to do this as I only use this account for savings bonds.

Fidelity: Very easy! Expand the bond in the "positions" view and hit the "sell" button. There is no fee to buy or sell, but be aware that there is a bid-ask spread, so there is a cost involved. If you own, say, 10 $1000 bonds and want to sell 5 of them, take care to enter "50" in the sell amount as bonds values are calculated in $100 lots.

Other brokerages (Vanguard, Schwab) charge a fee to sell a bond. Especially beware of Ally Bank's TradeKing investment account, where the fees can be as high as $50 a bond (not the advertised $1) and apply to buying and selling.

Some brokers (Ally Bank's TradeKing) do not allow you to sell a bond online, only by phone. Vanguard and Schwab used to, but both now allow you to sell bonds through the website (per their website; I haven't tried it).
HappyMan
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Re: Treasury Bond Buying Tutorial

Post by HappyMan » Tue Jul 03, 2018 9:56 am

Thank you. Forgot to mention that I am with Schwab. Will check their fees.
sophie wrote:
Tue Jul 03, 2018 7:52 am
Selling Treasuries can be a bit complicated and it depends on where you're holding them.

Treasury Direct: you can't sell them on the site. You have to transfer them to a brokerage account and then sell. I've never tried to do this as I only use this account for savings bonds.

Fidelity: Very easy! Expand the bond in the "positions" view and hit the "sell" button. There is no fee to buy or sell, but be aware that there is a bid-ask spread, so there is a cost involved. If you own, say, 10 $1000 bonds and want to sell 5 of them, take care to enter "50" in the sell amount as bonds values are calculated in $100 lots.

Other brokerages (Vanguard, Schwab) charge a fee to sell a bond. Especially beware of Ally Bank's TradeKing investment account, where the fees can be as high as $50 a bond (not the advertised $1) and apply to buying and selling.

Some brokers (Ally Bank's TradeKing) do not allow you to sell a bond online, only by phone. Vanguard and Schwab used to, but both now allow you to sell bonds through the website (per their website; I haven't tried it).
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