Post #40 by CharlieBonds on the Retirement Investing board

Personal Finance Topics / Retirement Investing

Unthreaded | Threaded | Whole Thread (6)

Post New | Post Reply | Report Post | Recommend It!

No. of Recommendations: 2

Mike,

Now that I've had a chance to think about your bond buying experience at Vanguard, it occurs to me there might be a couple other factors in play.

#1. How YTMs are calculated depends on what assumptions are made and which formulas are used. (E.g., a standard, 360-day year or an actual, day-count year.)

#2. You need to understand the diff between 'on-the-run' treasuries and 'off-the-run' treasuries. (If you don't, then look it up.) My bet is that Vanguard swapped in an off-run bond for your order for on on-run bond, because that way they could arb the spread, plus charge a markup up to boot.

Vanguard isn't broker. It's a bucket shop that abuses its customers. (IMHO, natch.)

Charlie

Post New | Post Reply | Report Post | Recommend It!

Print the post

Unthreaded | Threaded | Whole Thread (6)

Prev | Next

Announcements

Retirement Investing FAQ

Contact Shrewd'm
Contact the developer of these message boards.

A community forum supporting civilized, and highly helpful, self-educating investors that come together for Shrewdness and merry spirits. These message boards closely follow the look and feel of the old message boards at boards.fool.com prior to the boards redirected to discussion.fool.com. Shrewd'm is not affiliated with the comprehensive and excellent investment website, The Motley Fool (TMF), in any way. The Shrewd commmunity here has owed, and continues to owe, gratitude to The Motley Fool for nurturing a culture of jovial irreverence towards Wall St, and that tradition will continue here.