Purchasing US Treasuries & UK Gilts

[CFBLondon]

A few years ago, I was using IB quite a lot. Had bought a lot of treasuries. They can do that.

Thanks for the info. I've read some reviews and they've had a lot of recent complaints from people who say they can't access their funds... I'll stick with my trusted Hargreaves Lansdown account but thank you for trying to help.

I think the various ETFs on offer should get me the returns I want, for example the iShares IB01.

[air04]

Thanks for the info. I've read some reviews and they've had a lot of recent complaints from people who say they can't access their funds...

Can you share any links you have about it. I ask as I am considering IB again for USD. It is a publicly listed and a large company. Its offering is very large, used by Hedge funds etc. The types of accounts --> https://www.interactivebrokers.com/en/i ... figuration

Is it possible you mistake it to be some other company... its offering is complex, and more towards professionals and not retail. Its trading platform TWS took a while for me to get hang of.

[CFBLondon]

Sorry I'm not able to share links as a new forum user but I just Googled "interactive brokers review uk."

With or without those reviews, I have no personal experience to comment upon their service. However I am more comfortable with HL, who I've been happy with for many years.

[tincture]

Sorry I'm not able to share links as a new forum user but I just Googled "interactive brokers review uk."

With or without those reviews, I have no personal experience to comment upon their service. However I am more comfortable with HL, who I've been happy with for many years.

I've never had probs withdrawing money from IB. As other poster said make sure you are looking at correct company there is a very similarly named one out there.
Overall very happy with them & had quick online responses to quite technical queries over the years
But I do have to watch a howto video when converting currencies, everytime, as they make you do a complex FOREX currency pair trade :p (don't let this put you off)
I use IB for USD stuff and single stock trades. Even dipped my toe in the odd option trade with them before my day job got too busy
Cons: less access to to prefs, pibs and retail bonds talked about here.

BTW They have recently allowed ISA accounts, previously was just a trader account.

[hiriskpaul]

Hi,

If I was a US based investor, I would like to park my cash in 3-month T-bills as they currently yield over 4% annually.
However we've established that I can't do that directly in the UK.

Do you think this fund would offer the exposure I'm looking for? That is, steady growth around 4+%pa, and no reason to fall in nominal terms?
(I'm fine to expose myself to dollar and FX risk.)

JPMorgan ETFs (Ireland) ICAV - BetaBuilders US Treasury Bond 0-3 Months UCITS ETF (BBM3)
TER 0.07%
The Sub-Fund seeks to provide an exposure to the performance of US Dollar-denominated fixed rate government bonds issued by the US Treasury with a remaining maturity of less than or equal to three months.

Secondary question:
What difference in exposure would you expect if I chose a fund with a slightly longer outlook, up to a year?
For example a fund that aims to provide exposure to the short end of the Treasury curve targeting the 0-1yr maturity range and to reduce interest rate risk as well as minimise credit risk

Funds don't behave in quite the same way as the underlying bonds. Whenever you buy the ETF it will have roughly the same weighted average yield to maturity as maturing bonds get reinvested. Contrast that with a 3m bond. In 3m you will have more $ cash than you started with, but for an ETF you will have a 0-3 month ETF which may be worth less than you started with. The maturing 3m bond however, has reinvestment risk!

[1nvest]

I am keen to tap the knowledge of anyone here who is familiar with buying US treasuries and UK Gilts. Information I have located to date seems to indicate the following:-

1. US Treasuries

US citizens can buy US treasuries including participating in new issues using the US Treasury website

https://www.treasurydirect.gov/

I say US citizens as I note I see that you have to use TreasuryDirect for which investors must have a Social Security number or EIN, a U.S. address, and a checking or savings account. Other than that I’m assuming there is only the secondary markets accessible via brokers.

You may be able to get a US Tax Identification Number as a foreigner. The US address is just required for postal purposes (doesn't have to be a residential address, could be just a postal forwarding service/address). You also need a US cheque account capable of supporting payments in/out. So conceptually its viable to get a TreasuryDirect account. Don't know what tax/other issues that might involve/open-you-up-to however.

[murraypaul]

You may be able to get a US Tax Identification Number as a foreigner. The US address is just required for postal purposes (doesn't have to be a residential address, could be just a postal forwarding service/address). You also need a US cheque account capable of supporting payments in/out. So conceptually its viable to get a TreasuryDirect account. Don't know what tax/other issues that might involve/open-you-up-to however.

https://www.treasurydirect.gov/savings-bonds/buy-a-bond

Whether you buy an electronic bond or a paper bond, you must specify who owns the bond.

You may name yourself, a child, yourself and someone else (either as another owner or as the beneficiary), or indeed anyone you want to give the savings bond to as a gift.

But the person (or people) you name must meet these conditions:

- The person must have a Social Security Number.
- The person must also meet any one of these three conditions:
- - United States citizen, whether the person lives in the U.S. or abroad, or
- - United States resident, or
- - Civilian employee of the United States, no matter where that person lives

[1nvest]

Increasingly its as though the state no longer needs to sell Gilts/Treasuries, and indeed when you can print/spend why bother with borrowing (selling Gilts), other than it being nice to have pension funds having to buy/hold them, as taxation policies can 'confiscate' some of those funds as/when desired.

Prior to 1931 when gold Sovereign Pound coins and paper Pound notes were directly convertible, the state had to borrow gold, and pay a real rate of return in the process. When gold/money (Pounds) disconnected then the former low/no (broad) 0% inflation rate transitioned over to being predominately positive. Each new note printed/spent devalues all other notes in circulation, might be considered a form of micro-taxation, that supplemented with regular taxation ... and bonds that previously compared in total returns to stocks transitioned over to being more like 0% real expectancy assets - after inflation and taxation. No longer cost the state to borrow when bonds (Gilts) were sold, but equally where there was less need for Gilts when you have money printing presses at hand.

Japan pushes that to more extremes. Most of the bonds that the treasury issue are bought by its central bank, that can print money to buy those bonds.

Not good for honest workers/savers though, having to rely on modern day financial systems where bank deposits become the banks money, in effect you lending to the bank, or where even stocks are brokers taking your money and buying the stocks you line, in their name. And where those counter-party risk protections are limited to the likes of £85K.