Treasury Bill Quotes

Treasury Bill Quotes

Treasury bills, or T-bills, are issued by the US Treasury. They are considered among the safest of any investments because of their full backing by the US government. T-bills have maturities of 13 weeks (three months), 26 weeks (six months), or 52 weeks (one year). They have a minimum face value of $10,000 and bear no interest. Instead, they are issued at discounts from their face values, quoted on a discounted yield basis, and sold at yield auctions.

How T-bill prices work

The buyer is actually purchasing a specific, guaranteed yield when he or she buys a T-bill. Because of this, the bid and ask quotes appear to be the opposite of those of most securities, in that the bid is larger than the ask. This is because the figures being quoted are actually yields, and the higher the yield, the lower the price. For example, a T-bill quote might appear as follows:

The actual price of the bill at bid is lower than the ask, which is why it provides a higher yield. Rather than receiving periodic interest payments, the purchaser holds the bill until maturity, redeeming it at its full face value.