Types of t-bills, Financial Management

Types of T-Bills

In the US markets, though there are many types of T-bills, they can be broadly classified into two types - regular-series bills and irregular-series bills.

Regular-series bills are issued routinely by competitive auctions, either on a weekly or on a monthly basis. These bills are issued in regular series. They are issued by Federal Reserve district banks and their branches with different maturities of 3 months (13 weeks), 6 months (26 weeks) or 12 months (52 weeks). New issues of three or six month bills are auctioned weekly; whereas, new issues of one year bills are normally sold once in each month.

Irregular-series bills are issued when a special cash need arises for the Treasury. These T-bills are of two types - strip bills and cash management bills. Strip bills are nothing but a package of bills requiring investors to bid for an entire series of bills with different maturities. Investors who bid successfully must accept bills at their bid price each week for several weeks running. Cash management bills, on the other hand, consist simply of reopened issues of bills that were sold in prior weeks. The reopening of a bill issue normally occurs when there is an unusual or unexpected treasury need for more cash.

 

Posted Date: 9/11/2012 4:12:49 AM | Location : United States







Related Discussions:- Types of t-bills, Assignment Help, Ask Question on Types of t-bills, Get Answer, Expert's Help, Types of t-bills Discussions

Write discussion on Types of t-bills
Your posts are moderated
Related Questions
On-the-run treasury issues are the most recently auctioned issues of a given maturity. They include Treasury bills of 3-month, 6-month and 1-year maturity;  treas

How are financing costs generally incorporated into the capital budgeting analysis process? Financing costs are typically captured in the discount or hurdle rate when doing IRR

Question 1: Explain clearly how the study of Public Policy making enables us to understand how Government tackles the major problems of society. Question 2: Analyse th

Define Floating Rate Notes Floating-rate notes (FRNs) are commonly medium-term bonds along with their coupon payments indexed to some reference rate.  Common reference rates a

Q. Explain about Loans - Forms of Bank Finance? When a bank makes an advance in lump-sum against some security it is called a loan. In Case of a loan, a specified amount is san

Turnover has increased 10% since 2009 even if this is at the expense of a drop in the gross margin earned which has fallen from 35.0% to 32.7% which has resulted in only a marginal

application of the operating cycle to a vegetable company

Q. Diffrence between present values of future cash ? The difference among the present values of future cash inflows generated by an asset and its cost is known as net present v

A Ltd sells goods at Rs.10.P.U. Its variable cost Rs.7.P.U and fixed cost amount to Rs.1,70,000 it finances all its assets by equity funds. It pays 40% tax on its income. Z Ltd is

DEFINITION OF BUDGETARY CONTROL As per the ICMA, BUDGETARY CONTROL is the establishment of budgets, relating the tasks of executives to the requirements of a policy, and the c