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Several papers recently published articles about the relatively weak demand (and pricing) for the recently reintroduced 20-year US Treasury bonds comparing to 30-year bonds. Here is one (behind paywall, unfortunately):
https://www.wsj.com/articles/treasurys-20-year-bond-struggle...

The articles point to the fact that the 20-year issue actually trades with a higher yield than the 30. Fortunately, the bond quotes page at WSJ should be accessible to everyone where latest (could be a day old) prices and yields are displayed per maturity date:
https://www.wsj.com/market-data/bonds/treasuries?mod=md_bond...

If you build a yield curve you'll see some of that "funkiness" (and even choppiness) on the long end where the highest yielding Treasury securities are actually the ones maturing in 2041, not 2051. Either way the yield is under 2% which is deeply negative in real terms but it's pretty clear that institutions that trade in and out of the long bond - hedge funds, big banks, etc - prefer the liquidity of the 30 and don't care about this inversion. (Actually, I read somewhere that hedgies love trading the 10-year note the most out of all UST's which makes sense as it's the most liquid coupon bond in the world.) Found that interesting and just thought I'd share... as much as I realize this post is mostly pointless for ordinary bond investors given that UST's are more or less uninvestable still given these generous yields. :)
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prefer the liquidity of the 30

I don't understand this statement. All the 30s issued 10 years ago are still trading, with 20 years remaining on them. They are essentially equivalent to newly issued 20s today. And their liquidity is identical.
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prefer the liquidity of the 30
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I don't understand this statement. All the 30s issued 10 years ago are still trading, with 20 years remaining on them. They are essentially equivalent to newly issued 20s today. And their liquidity is identical.

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I thought the same thing. On the other hand, I do think it's true that the Treasury probably does issue more 10-year and 30-year bonds in a given year than 20-year bonds. So on any given day there may be more trading volume in those maturities, and more potential buyers. But really, Treasury bonds are all plenty liquid.

Bill
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The "30" in this context is the fresh 30-year bond or one with the longest maturity of all available. It's not as liquid as the latest issued 10-year note but still very much so. Then as it "ages out" into off-the-run status, its liquidity starts to decrease. Sure, various bond desks may still carry enough inventory of various Treasury bonds/notes from a retail point of view but there may be a different story if you're an institution. Those guys usually trade in huge lots and may, at the present time, have a harder time moving X amount of a bond maturing in 2041 vs same X amount of one maturing in 2051.

I read some months ago that in March of 2020 liquidity of certain Treasury issues really dried up. Perhaps it's not that it dried up but just wasn't there for the lots certain foreign funds, other large players needed to move. One source: https://www.youtube.com/watch?v=LaQhyd2h974.

I imagine retail buyers/sellers were still able to trade lots of, say, 25, 50 or 100 bonds fairly easily. I think the point is that given where rates are now, Treasury securities are for institutions to play now with more than ever. They have their own preferences for various reasons - 10-yr being more popular than 30-yr, 30 more liquid than 20, etc - and get better pricing on massive lots as they trade them back and forth. These UST rates just don't make much sense for retail bond investors in the States who like to either hold to maturity or at least for a considerable amount of time. If a retail investor wants to trade UST's, ETF's like IEF, TLT, SPTL, etc are probably the way to go but, again, the market is dominated by institutions. Not sure how much edge the "little guy" has there...

My point of view for whatever it's worth.
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I imagine a small number of retail investors overseas, esp. in Emerging Markets, may be able get their hands on UST's and may be happy to do so even with these low UST rates as their home currency may be in much worse shape than USD. A few extreme inflation examples are below.
Venezuela: 1575%
Sudan: 366%
N. Korea: 66%
Zimbabwe: 54%
Argentina: 52%
Source: https://images.blockdata.tech/blog-posts/post-images/619d021...

Historically, those that could't get a hold of UST's - majority of ordinary people overseas don't trade UST's :) - would simply buy USD's. I suppose this is quite a bit off topic so I'll end it there.
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