So what would I earn on these?

I'm trying to learn more about t-bills/bonds ets... and am looking at recent auction news... what does this mean? what interest rate will I earn per $1000? 4.930% or 5.062%? what does the Price: 98.753806 mean? this information is for a 91-day T-bill.

formatting link

Any help would be greatly appreciated. Thanks, Da Bears!

Reply to
Da Bears
Loading thread data ...

What this means is that you pay $98.75 for a $100 bond. You get the $100 back at the end of 91 days. This gives you a $1.25 in profit. If you do that (4) times in a row, it nets you about $5 per year. $5 per year on a $100 investment is 5%. The exact percentage will vary a bit since 4 x 91 is not 365, and since you get back more than you invest, you have compounding effect

3 times during the year, and you are only investing $98.75 to get started, not the full $100. Your 5.06% is probably pretty close.

-john-

Reply to
John A. Weeks III

BeanSmart website is not affiliated with any of the manufacturers or service providers discussed here. All logos and trade names are the property of their respective owners.