Treasurys for Sale
Moderator: Global Moderator
Re: Treasurys for Sale
I wouldn’t worry anymore than you would worry about a spread when selling an ETF.
Re: Treasurys for Sale
Just kidding.
“As a white person of colour, I am extremely concerned about the rise of black whiteness.” — Titania McGrath
pariah — 1610s member of a low caste in S. India; Tamil (Dravidian) “drummer”, as members of the lowest caste played drums at festivals. “social outcast,” 1819.
pariah — 1610s member of a low caste in S. India; Tamil (Dravidian) “drummer”, as members of the lowest caste played drums at festivals. “social outcast,” 1819.
- Kriegsspiel
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Re: Treasurys for Sale
Since KGB wasn't very helpful, I'll offer a wild guess! I wonder if Vanguard uses a wider spread to get a bond from the primary purchaser into the secondary market to recoup higher associated costs. Then when they broker secondary market trades, their spread is smaller. That's how they make money without charging commission.
I hated all the things I had toiled for under the sun, because I must leave them to the one who comes after me. Who knows whether that person will be wise or foolish? Yet they will have control over all the fruit of my toil into which I have poured my effort and skill under the sun. . . Nothing is better for a man than to eat and drink and enjoy his work.
- Ecclesiastes
- Ecclesiastes
Re: Treasurys for Sale
hmm, makes sense.Maybe that’s it.
“As a white person of colour, I am extremely concerned about the rise of black whiteness.” — Titania McGrath
pariah — 1610s member of a low caste in S. India; Tamil (Dravidian) “drummer”, as members of the lowest caste played drums at festivals. “social outcast,” 1819.
pariah — 1610s member of a low caste in S. India; Tamil (Dravidian) “drummer”, as members of the lowest caste played drums at festivals. “social outcast,” 1819.
Re: Treasurys for Sale
Details of how this is done at your brokerage should be available from them via a disclosure. It may take some digging.
Re: Treasurys for Sale
Details of how this is done at your brokerage should be available from them via a disclosure. Finding it may take some digging.
The main point to all of this is that bonds also have bid/ask spreads just like stocks, ETFs, futures, options etc. Some brokerages are more transparent about it.
The main point to all of this is that bonds also have bid/ask spreads just like stocks, ETFs, futures, options etc. Some brokerages are more transparent about it.
Re: Treasurys for Sale
On the secondary market, I’ve noticed that sometimes smaller trades or odd-sized trades have higher spreads than the large trades involving nice, round numbers. Whereas at auction, I believe the size of your purchase makes no difference.
But for a PP investor who is trading bonds only a couple of times a year at the most, the secondary market spreads are negligible when viewed as an annualized “expense ratio.” Lower than most Treasury ETFs, I would think.
But for a PP investor who is trading bonds only a couple of times a year at the most, the secondary market spreads are negligible when viewed as an annualized “expense ratio.” Lower than most Treasury ETFs, I would think.