Bonds at Vanguard

[dualstow]

I think КГБ didn't like your "we take whatever they give us" phrasing

That's what I suspected. I just meant that the other kind of bidders set the rate. If I thought we were getting shafted, I would't use the auction. I've only bought on the secondary market a few times, but I've used the auction dozens of times (for t-bills, notes and 10-years, too).

[Kbg]

...I don't think I felt I was getting the shaft

?

Meaning, you get the final auction price...https://www.treasurydirect.gov/instit/a ... k/work.htm

This of course does not necessarily apply to what you get via your broker...that's another layer you'll need to dig through (e.g. how your broker does it if buying Ts through them) TD gives you the non-competitive rate.

None of the above is intended to comment one way or the other on Fed policy/open market operations. It's pretty clear from pricing and their own data that the Fed is likely the biggest buyer of US bonds maybe of all types now. How the auctions work is unchanged. What is different is the degree to which the Fed is buying Ts.

I'm not offended, unhappy, endorsing or happy with any of this. On one hand I get nothing for putting my savings into safe assets but I also get extremely cheap loans these days and my risky assets are up quite nicely. The first sucks, no complaints about the last two. There is clearly a disincentive to putting savings into safe assets and clearly an incentive to invest in riskier assets or take on some debt...but that's the whole point of the current monetary policy, love it, hate it, or neutral on it.

As an investor/trader experience has taught me not to pay any attention to my opinions on anything which is extremely difficult to do in practice. I have one goal and one goal only for my funds - grow them as much as I can at a risk level I am comfortable with. I don't really care how I achieve that consistent with my own ethics.

[dualstow]

On one hand I get nothing for putting my savings into safe assets but I also get extremely cheap loans these days and my risky assets are up quite nicely.
...
There is clearly a disincentive to putting savings into safe assets and clearly an incentive to invest in riskier assets or take on some debt...
...

I don't get anything from home insurance except the knowledge that I will probably be alright if my house burns down (and I'm not in it).
I miss the yields of the past, but I feel good about putting money into the treasury money market. I can spend it, and when the market crashes, that fund won't. It's not so bad. I guess I could say I still have the incentive.

[Kbg]

I actually have a big wad of bonds via ETFs. I like BND which is where most my allocation is and I also have some VGSH and SLQD. I’m not super keen on long term bonds these days. The risk reward just isn’t there, but that’s just my opinion.

From a “feelings” perspective, it does tick me off we can’t buy a safe bond that at least paces inflation.

[dualstow]

Maddy, et al: Just a reminder that if you bought bonds at the auction your portfolio might look smaller between the time of the trade execution and the settlement. I bought some ten-year notes that executed today, and $10K is gone from the settlement fund while the holdings won't appear for a few days. So, don't panic if you see the same.

[dualstow]

auction results attached

spoiler alert: $98.68

[Maddy]

Here's another question only a newbie could ask:

So when you guys rebalance, or when you figure the value of your portfolio, how do you go about establishing a present value for a tranche of bonds having an initial value of $98.68?

[dualstow]

...
how do you go about establishing a present value for a tranche of bonds having an initial value of $98.68?

The purchase price aside, my brokerage houses (Fido and Vanguard) show me how much the bond holdings are worth. Both in monthly statements and on a daily basis — delayed a day, perhaps — in cost basis.

I used to also draw a price from the Wall St Jrnl, into google spreadsheets. fnord, a member here, had posts on how to do that. It took some tinkering and maintenance to keep up with changing dates, but you basically plugged in a formula that would pull data from some tables at the WSJ site. It used maturity dates and not CUSIPs. Eventually it stopped working for me and so I just log into my brokerage account if I really want to see.

[Kriegsspiel]

In your spreadsheet, put what you bought it for, and what the current price is. Then point your pie chart point towards the current value.

[dualstow]

pie chart

Wow, I forgot all about an older spreadsheet with a pie tab. I should get back into that. i think I gave up when I had to hard-code the bond prices