Managing IT Treasury allocation
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- dualstow
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Re: Managing IT Treasury allocation
For treasuries, though? Traded online, without a representative?
Re: Managing IT Treasury allocation
I just spoke with bond desk at fidelity and they stated no markup. To verify I looked at current market yield on Bloomberg and it actually showed the yield at about 5 basis points lower than Fidelity, which would indicate a lower per bond price. Real time quotes may be a factor here since we are only talking a few basis points.
The only markup to the bond I can find at Fidelity is the bid/ask spread of about 20 bp. Am I missing something? However, it's so easy to buy at auction from them I think I'll start considering this route.
The only markup to the bond I can find at Fidelity is the bid/ask spread of about 20 bp. Am I missing something? However, it's so easy to buy at auction from them I think I'll start considering this route.
Re: Managing IT Treasury allocation
Just a quick re-visit to this subject (realizing I may be the only one interested). After researching I still don't know about markup by Fidelity on secondary market purchases.
It looks like the best solution is to by at auction through Fidelity. As far as I can tell there is absolutely no markup involved.
It looks like the best solution is to by at auction through Fidelity. As far as I can tell there is absolutely no markup involved.
- Austen Heller
- Executive Member
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- Joined: Tue Aug 24, 2010 6:58 pm
Re: Managing IT Treasury allocation
Yes, buying at auction is the best way to avoid any markups. As far as selling, you will have to pay a slight markup, but it should be very small (approx equal to half the bid-ask spread, so about 10 bp if the spread is 20 bp). And that is just a one-time fee you pay when selling, much better than the 10-15 bp charged annually by the mutual funds and ETFs. Buying at auction is so easy, and as long as your brokerage doesn't charge a big fee to sell on the secondary market, it's a no brainer.