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
Explain the concept of the world beta of a security. Answer:  The world beta calculates the sensitivity of returns to a security to returns to the world market portfolio. It is

Explain how exchange rate fluctuations influence the return from a foreign market measured in dollar terms. Discuss the empirical proof on the effect of exchange rate doubt on the

You are presented with the budgeted data shown below for the period November 20X1 to June 20X2 by your firm. It has been extracted from the other functional budgets that have been

Collateralized Mortgage Obligations (CMOs) CMOs retain many of the yield and credit quality advantages of pass-throughs, while eliminating some of the

An Investor can receive income from this source when the bonds purchased at discount are held up to maturity or when he sells the bond before ma

What are some of the government requirements imposed on a public corporation that are not imposed on a private, closely held corporation? Public corporations ought to tender au

Project Z has a cost of $ 50,000.00, its expected net cash flows are $11,000 per year for 8 years, and its cost of capital is 12 % (Hint: begin by constructing a time line). Ins

1. In this query the implied volatilities are calculated by using a risk free interest rate of 2%. The computation are summarized by the following figure. 2. The computatio

To what extent does empirical evidence on corporate objectives support the predictions of Baumol’s “Sales Maximisation Hypothesis?”

as a financial analyst, you must evaluate a proposed project to produce printer ink. the equipment would cost 60000 plus 10000 for installation. annual sales would be 5000 units at