Where would you roll a 6M T-Bill now? (Please vote in poll)

[chang]

I want to maintain safety, income, and flexibility*. (*Am reluctant to roll over into another 6M T-bill, as I might need the cash 3-6 months from now.) I will likely split the sum among the top two favorites. You can vote up to 2 choices.

All yields per fund web sites as of today, except RPHIX comes from Fidelity (link) as RiverPark doesn't post it.

Click to expand chart.

[fishingrod]

The little extra yield/appreciation you may get is not worth the risk of loss if you are possibly going to need the money soon. My vote goes to VMFXX. There is no need to keep reaching.

[racqueteer]

I agree.  Of the charted items, RPHIX looks pretty good, but performing a straight comparison of it and VMFXX at Stockcharts seems to indicate a basically sideways comparison.  Why bother over 3-6 months?

[chang]

Jun 12, 2023 10:40:58 GMT racqueteer said:

I agree.  Of the charted items, RPHIX looks pretty good, but performing a straight comparison of it and VMFXX at Stockcharts seems to indicate a basically sideways comparison.  Why bother over 3-6 months?

Minor note: the T-Bill will be redeemed in my Fido account; to get it moved over to VMFXX means a transfer to my bank and another transfer to Vanguard … probably 2-3 days lost. I’m earning about $70/day, so it’s better to minimize any frictional losses.

At Fido I could invest it immediately into RPHIX or an ETF.

[Chahta]

In unsteady times like we have now, this portion of your portfolio is justified being put into MM. Max flexibility and yield are worth having. You will be ready to move in a few months with the anticipated first rate decrease.

[racqueteer]

Jun 12, 2023 11:58:54 GMT chang said:

Jun 12, 2023 10:40:58 GMT racqueteer said:

I agree.  Of the charted items, RPHIX looks pretty good, but performing a straight comparison of it and VMFXX at Stockcharts seems to indicate a basically sideways comparison.  Why bother over 3-6 months?

Minor note: the T-Bill will be redeemed in my Fido account; to get it moved over to VMFXX means a transfer to my bank and another transfer to Vanguard … probably 2-3 days lost. I’m earning about $70/day, so it’s better to minimize any frictional losses.

At Fido I could invest it immediately into RPHIX or an ETF.

Doesn't Fidelity have an equivalent fund to VMFXX? 

[win1177]

VMFXX, yields are pretty high right now and maximum “flexibility”, but starting to look at longer duration fora portion of my fixed income.

Win

[hondo]

VMFXX for all of the stated reasons.

[chang]

racqueteer: "Doesn't Fidelity have an equivalent fund to VMFXX?"

Their settlement fund is SPAXX, and they also have a slightly cheaper / better MM fund FZDXX, which is where I keep a petty cash. But both of these MMs are inferior to Vanguard’s dirt-cheap MMs. Even Fidelity’s institutional MMs with $1-10 million minimums are inferior to VMFXX.

Back when I had an account with TDA, my rep gave me access to some amazing Federated-Hermes MMs with yields higher than Vanguard’s. But I lost that when I closed the account.

[Chahta]

Jun 12, 2023 13:30:52 GMT win1177 said:

VMFXX, yields are pretty high right now and maximum “flexibility”, but starting to look at longer duration fora portion of my fixed income.

Win

Good thinking. You like to make money.

[Fearchar]

I voted for VMFXX. But today's 3 month treasury auction was for 5.305% investment rate.

So, as long as your cash levels are low, I would consider deploying at least some into the next auction.

Next week's bills will mature on Sept 21.

[chang]

Thanks Fearchar. I would consider a 3M, but not a 6M at this point.

I’m surprised at the poll results so far. I thought MINT would be the winner.

[racqueteer]

Jun 12, 2023 19:15:03 GMT chang said:

Thanks Fearchar . I would consider a 3M, but not a 6M at this point.

I’m surprised at the poll results so far. I thought MINT would be the winner.

Most of MINT out-performance came in January.  Not sure there's anything special happening now.

[steadyeddy]

I would prefer VUSB with about 0.9 years duration primarily because I believe the Fed is at their tail end of rate hikes, and it provides decent cap gain opportunity if/when rates come down.

I am in the camp of increasing bond durations at this stage of rate hiking cycle.

[chang]

Jun 18, 2023 13:34:05 GMT steadyeddy said:

I am in the camp of increasing bond durations at this stage of rate hiking cycle.

That's another reason to stay flexible, and not lock into a 3M or 6M T-bill.

I'm thinking to split the T-bill proceeds (expected on Thursday or Friday) between RPHIX and VMFXX. I have existing positions in these, so this has the virtue of not involving any new positions.

[chang]

Jun 12, 2023 20:14:26 GMT racqueteer said:

Jun 12, 2023 19:15:03 GMT chang said:

Thanks Fearchar . I would consider a 3M, but not a 6M at this point.

I’m surprised at the poll results so far. I thought MINT would be the winner.

Most of MINT out-performance came in January.  Not sure there's anything special happening now.

Per M*, MINT is in the top 20% of the Ultrashort Bond category over 1-3-6 months. So its outperformance appears to be fairly steady over the last six months.

www.morningstar.com/etfs/arcx/mint/performance

The chart shows, however, that it's not as "safe" as a MM fund.

[steadyeddy]

Jun 18, 2023 14:01:00 GMT chang said:

Jun 18, 2023 13:34:05 GMT steadyeddy said:

I am in the camp of increasing bond durations at this stage of rate hiking cycle.

That's another reason to stay flexible, and not lock into a 3M or 6M T-bill.

I'm thinking to split the T-bill proceeds (expected on Thursday or Friday) between RPHIX and VMFXX. I have existing positions in these, so this has the virtue of not involving any new positions.

Yep good to keep the portfolio simple. You wouldn't go wrong with the choices you made.

[Fearchar]

Was thinking of entering the T-Bill auction; looks like it will be Tuesday.
Considering a variety of durations between 3 to 6 months; all of these durations are likely to yield about 5.3%.

Still open to consider other options including MINT or even RCTIX:

[roi2020]

VMFXX provides desired safety and maximum flexibility.

[anitya]

Why do you guys like auctions? (I know at Fidelity, anything bought at auctions can be automatically rolled over.)

(I bought twice at auction and got stiffed (rate moved after the time I entered the order): 3 mo and 1 yr. If you buy at auctions continually (e.g., auto rollover feature) may be over time you average out the good and the bad. I make big block purchases so I make fewer trades.  Secondaries are a little bit more work but when I place the order, I know what I am buying.)

[Fearchar]

Jun 18, 2023 18:36:23 GMT anitya said:

Why do you guys like auctions? (I know at Fidelity, anything bought at auctions can be automatically rolled over.)

(I bought twice at auction and got stiffed (rate moved after the time I entered the order): 3 mo and 1 yr. If you buy at auctions continually (e.g., auto rollover feature) may be over time you average out the good and the bad. I make big block purchases so I make fewer trades.  Secondaries are a little bit more work but when I place the order, I know what I am buying.)

anitya

I like Treasury auctions because as I understand it, the small investor gets the best rate.
In the secondary market, there is the spread to be paid/made.
So far, my experience has been that auctions beat MM over the period they are held.
Also, technically no expense ratios. 
It's pure investing and feels almost patriotic since it's dealing with Uncle Sam.

Negative of auctions is that no interest accrues over the weekend gap.
I don't use the auto re-invest feature.

I'm new to auctions and T-bills.
So, there could be something I'm seriously missing.
It has also been a long time since we had positive real interest rates.

[Fearchar]

PS: perhaps I've been spoiled since I bought during the debt crisis, which provided for higher than normal rates.