All major brokers allow participation in bond auctions, including IB -- though possibly with a size requirement. Don't be bashful -- call their bond desk.
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IB Cash vs short term bonds
- Thread starter traction
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I bought my first T-bill about a month ago on IB.
Don't be bashful -- call their bond desk.
Great info. Thanks.
IB charges 0.002% not 0.02% as you stated:confirmations on some points that wasn't 100% clear to me prior to doing this trade:
1) Commissions -- IB's direct commissions on US fed treasuries is 0.02% of face value with a $5 minimum. Effectively what this means is that if you buy less than $25k, you're paying $5 commissions. If you want the 0.02% to match $5, then you need to trade at least $25k to optimize commissions. They have a price break at $1M, but I'm a bit short of that. Also I wanted to do a small amount as my first bond trade, so I did $25k.
And that throws some of your calculations off considerably. E.g., you would need $250k, not $25k to "optimize commissions" as you put it.
This is an old thread but I needed to bring it up as it was both incorrect and interesting that so many people read, and a higher-than-usual number liked it without regard to its accuracy.
Regards,
JP
About the NBBO, not sure it would work with smaller orders but it's worth checking the Net vs Raw setting for fixed income, as mentioned in the thread below.
https://www.elitetrader.com/et/threads/how-to-buy-us-t-govt-bill.324752/#post-4737359
Bought Tbill only once since switching the setting, placed an order mid point which didn't show up on TWS (why is that ? it seems orders between the NBBO don't show up on my platform on Tbills, any idea whether some market data is lacking ?) but still got filled at that point (after I increased the bid slightly, got filled at the initial bid, not sure what happened, again connection is dodgy from here). Will try a couple more orders soon, see how that works, got filled on bid with Net setting but not always before switching.
About rolling over Tbills, settlement appears to be T+1, so do you guys buy new Tbills 1 day before expiration ?
Just checked on IB statements and corporate bonds seem to settle at T+2, read somewhere that US gov notes settle at T+1 - I could check on IB statements as well, but I suspect someone will show up with a refutation if that's wrong.
https://www.elitetrader.com/et/threads/how-to-buy-us-t-govt-bill.324752/#post-4737359
Bought Tbill only once since switching the setting, placed an order mid point which didn't show up on TWS (why is that ? it seems orders between the NBBO don't show up on my platform on Tbills, any idea whether some market data is lacking ?) but still got filled at that point (after I increased the bid slightly, got filled at the initial bid, not sure what happened, again connection is dodgy from here). Will try a couple more orders soon, see how that works, got filled on bid with Net setting but not always before switching.
About rolling over Tbills, settlement appears to be T+1, so do you guys buy new Tbills 1 day before expiration ?
Just checked on IB statements and corporate bonds seem to settle at T+2, read somewhere that US gov notes settle at T+1 - I could check on IB statements as well, but I suspect someone will show up with a refutation if that's wrong.