4 Week Treasury Bill Rate Analysis (2024)

FAQs

How much will I make from a 4 week T bill? ›

4 Week Treasury Bill Rate is at 5.28%, compared to 5.28% the previous market day and 4.04% last year. This is higher than the long term average of 1.40%. The 4 Week Treasury Bill Rate is the yield received for investing in a US government issued treasury bill that has a maturity of 4 weeks.

We sell Treasury Bills (Bills) for terms ranging from four weeks to 52 weeks. Bills are sold at a discount or at par (face value). When the bill matures, you are paid its face value. You can hold a bill until it matures or sell it before it matures.

While interest rates and inflation can affect Treasury bill rates, they're generally considered a lower-risk (but lower-reward) investment than other debt securities. Treasury bills are backed by the full faith and credit of the U.S. government. If held to maturity, T-bills are considered virtually risk-free.

Bills are sold at a discount. The discount rate is determined at auction. Bills pay interest only at maturity. The interest is equal to the face value minus the purchase price.

There is virtually zero risk that you will lose principal by investing in T-bonds. There is a risk that you could have earned better money elsewhere. Investing decisions are always a tradeoff between risk and reward.

Taxes: Treasury bills are exempt from state and local taxes but still subject to federal income taxes. That makes them less attractive holdings for taxable accounts. Investors in higher tax brackets might want to consider short-term municipal securities instead.

A Treasury Bill (T-Bill) is a short-term debt obligation backed by the U.S. Treasury Department with a one-year maturity or less. Treasury bills are usually sold in denominations of $1,000, while some can reach a maximum denomination of $5 million. T-bill rates depend on interest rate expectations.

Buy Treasury bills through a bank

One of the most common ways to purchase Treasury bills is through a bank. Banks usually offer an array of T-bill products with varying maturities and yields, allowing you to choose the one that best suits your investment needs.

Basic Info

1 Month Treasury Rate is at 5.49%, compared to 5.49% the previous market day and 3.89% last year.

To calculate the price, take 180 days and multiply by 1.5 to get 270. Then, divide by 360 to get 0.75, and subtract 100 minus 0.75. The answer is 99.25. Because you're buying a $1,000 Treasury bill instead of one for $100, multiply 99.25 by 10 to get the final price of $992.50.

How do you calculate return on a Treasury bill? ›

To calculate yield, subtract the bill's purchase price from its face value and then divide the result by the bill's purchase price. Finally, multiply your answer by 100 to convert it to a percentage.

Treasury bonds are considered risk-free assets, meaning there is no risk that the investor will lose their principal.

The only interest payment to you occurs when your bill matures. At that time, you are paid the par amount (also called face value) of the bill. (Bills are typically sold at a discount from the par amount, and the difference between the purchase price and the par amount is your interest.)

If you live in a state with income taxes, and rates are similar for CDs and T-bills, then it makes sense to go with a T-bill. The amount you save on taxes will likely result in a higher payout from a T-bill than a CD. Another benefit of T-bills is their liquidity. You can buy and sell them on a secondary market.

To calculate yield, subtract the bill's purchase price from its face value and then divide the result by the bill's purchase price. Finally, multiply your answer by 100 to convert it to a percentage.

The return for investors is determined by the difference between the discounted purchase price and the face value received at maturity. Thus, this discounted purchase price represents the interest earned by the investor.

Depending on the length of the T-Bill investors can get yields approaching 5%,” says Kevin Nicholson, Global CIO of Fixed Income at RiverFront Investment Group. “For example, a 6-month T-Bill is currently yielding 4.75% while the 10-year Treasury is yielding 3.47%.

Take the number of days until the Treasury bill matures and multiply it by the interest rate in percent. Take the result and divide it by 360, as the Treasury uses interest-rate assumptions using the common accounting standard of 360-day years. Then, subtract the resulting number from 100.