I have been thinking about the same thing. One way to reduce the transaction costs is to buy the T-notes at auction. You can do this at most brokers for a small fee (Vanguard is $25 while Schwab/Fidelity charge $50).The problem is the transaction cost at selling. Unless it's a fraction of a percent it will eat up most of the gain from rolling down the curve.Another problem is the spread between CD and treasury note rates. For example, 2 year notes are yielding about 3.2% but I can find 2 year CD's yielding 4.4% (http://www.advantabankcorp.com/cd_h.htm).Even with the gains from rolling down the curve and California income taxes, I don't think I can beat that.ayduda
Best Of |
Favorites & Replies |
Start a New Board |
My Fool |
BATS data provided in real-time. NYSE, NASDAQ and NYSEMKT data delayed 15 minutes.
Real-Time prices provided by BATS. Market data provided by Interactive Data.
Company fundamental data provided by Morningstar. Earnings Estimates, Analyst Ra