Cancelled T-bond Orders

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Tortoise
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Cancelled T-bond Orders

Postby Tortoise » Tue Aug 22, 2017 4:26 pm

Today I ran into an interesting problem that I've never had before, and I was wondering if any of you might be able to help.

In my Fidelity 401(k), I'm trying to buy a single T-bond ($1,000 face value) with a particular CUSIP number on the secondary market. I've tried about 5 or 6 times today, but each time the order ends up being displayed as "Verified Cancelled" after a minute or two.

I've never had this issue before. Usually my T-bond orders go through after just one or two attempts. But in this case, it just won't take, no matter how many times I try.

Fidelity evidently only lets you place limit orders -- not market orders -- when buying T-bonds, so what I typically do is define my limit as the lowest ask price by a seller willing to sell the number of bonds I want (in this case, 1). I click on a link that shows me how many bonds are for sale at each ask price, and next to each of those is the minimum number of bonds the seller is willing to sell. That's where I obtain my limit.

Any ideas what might be going wrong? The "Verified Cancelled" messages provide zero information regarding the reason for the cancellation.
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jhogue
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Re: Cancelled T-bond Orders

Postby jhogue » Tue Aug 22, 2017 5:24 pm

Tortoise wrote:Today I ran into an interesting problem that I've never had before, and I was wondering if any of you might be able to help.

In my Fidelity 401(k), I'm trying to buy a single T-bond ($1,000 face value) with a particular CUSIP number on the secondary market. I've tried about 5 or 6 times today, but each time the order ends up being displayed as "Verified Cancelled" after a minute or two.

I've never had this issue before. Usually my T-bond orders go through after just one or two attempts. But in this case, it just won't take, no matter how many times I try.

Fidelity evidently only lets you place limit orders -- not market orders -- when buying T-bonds, so what I typically do is define my limit as the lowest ask price by a seller willing to sell the number of bonds I want (in this case, 1). I click on a link that shows me how many bonds are for sale at each ask price, and next to each of those is the minimum number of bonds the seller is willing to sell. That's where I obtain my limit.

Any ideas what might be going wrong? The "Verified Cancelled" messages provide zero information regarding the reason for the cancellation.


Tortoise,
I had the same problem earlier this month.

The “market order” button has apparently been greyed out due to a recent software upgrade. You now have to go into the new “depth of book” on the order execution page to find a price that corresponds to the approximate number of bonds you are looking to purchase (in your case, one) and the particular CUSIP you want.

If you still have problems executing the order, try calling Fidelity’s fixed income traders at 1-800-544-5372. I worked with John, extension 16261, who explained the problem to me in greater detail and provided the work-around I described above.

Please let us know if this change works for you. We should probably then ask the moderators to sticky this email exchange, as this represents a modification from Gumby’s original 2011 tutorial on direct purchase of T-bonds through Fidelity which is posted in the Bonds section.
“Groucho Marx wrote:
A stock trader asked him, "Groucho, where do you put all your money?" Groucho was said to have replied, "In Treasury bonds", and the trader said, "You can't make much money on those." Groucho said, "You can if you have enough of them!"
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Tortoise
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Re: Cancelled T-bond Orders

Postby Tortoise » Wed Aug 23, 2017 12:27 am

jhogue wrote:
Fidelity evidently only lets you place limit orders -- not market orders -- when buying T-bonds, so what I typically do is define my limit as the lowest ask price by a seller willing to sell the number of bonds I want (in this case, 1). I click on a link that shows me how many bonds are for sale at each ask price, and next to each of those is the minimum number of bonds the seller is willing to sell. That's where I obtain my limit.

The “market order” button has apparently been greyed out due to a recent software upgrade.


I always enjoy software "upgrades" that introduce bugs or reduce functionality ::)

jhogue wrote:You now have to go into the new “depth of book” on the order execution page to find a price that corresponds to the approximate number of bonds you are looking to purchase (in your case, one) and the particular CUSIP you want.


Right. As I mentioned in my post, that's what I did. (I didn't use the explicit term "depth of book," but that's the link I clicked on.) I used the "depth of book" table to place a limit order five or six times in a row. It didn't work.

jhogue wrote:If you still have problems executing the order, try calling Fidelity’s fixed income traders at 1-800-544-5372. I worked with John, extension 16261, who explained the problem to me in greater detail and provided the work-around I described above.


Thanks, I'll try the same thing again tomorrow and see if my luck changes. If not, I'll call the fixed income traders or maybe just wait until the next 30-year Treasury auction to buy a bond; those are market orders that can conveniently be placed 24 hours a day, unlike secondary market T-bond orders.

jhogue wrote:Please let us know if this change works for you. We should probably then ask the moderators to sticky this email exchange, as this represents a modification from Gumby’s original 2011 tutorial on direct purchase of T-bonds through Fidelity which is posted in the Bonds section.


Will do.
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Tortoise
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Re: Cancelled T-bond Orders

Postby Tortoise » Wed Aug 23, 2017 1:01 pm

Interesting, today my T-bond purchase was successful after only two attempts. I didn't do anything different compared to yesterday -- today it just worked.

I really hope Fidelity fixes this annoying glitch in their fixed-income user interface. Kind of disappointing.
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jhogue
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Re: Cancelled T-bond Orders

Postby jhogue » Thu Aug 24, 2017 8:25 am

Agreed.

I don't know why Fidelity would let this problem continue. Normally their website gets very high ratings for ease of consumer use.
“Groucho Marx wrote:
A stock trader asked him, "Groucho, where do you put all your money?" Groucho was said to have replied, "In Treasury bonds", and the trader said, "You can't make much money on those." Groucho said, "You can if you have enough of them!"

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