4 Week T Bill Calculator

Face Value ($):

Discount Rate (%):

Calculate

 

Introduction

The 4-week Treasury Bill, or T-Bill, is a short-term investment vehicle issued by the U.S. Department of the Treasury. Investors often use it as a low-risk option for preserving capital. Calculating the return on a 4-week T-Bill investment is essential for assessing its performance. The 4-week T-Bill calculator simplifies this process, helping investors gauge their potential earnings.

Formula:

The formula for calculating the return on a 4-week T-Bill is as follows:

Interest Earned=(Face Value−Purchase Price Purchase Price)×(365Days to Maturity)×100Interest Earned=(Purchase Price Face Value−Purchase Price​)×(Days to Maturity365​)×100

Here, the Face Value is the value of the T-Bill at maturity, the Purchase Price is the amount paid to acquire the T-Bill, and Days to Maturity is the number of days until the T-Bill matures.

How to Use?

1. Enter Purchase Price: Input the amount you paid to purchase the 4-week T-Bill.
2. Enter Face Value: Specify the face value of the T-Bill at maturity.
3. Enter Days to Maturity: Input the number of days remaining until the T-Bill matures.
4. Calculate: Press the calculate button to determine the interest earned.

Example:

Consider a 4-week T-Bill with a Face Value of $10,000, a Purchase Price of $9,950, and 28 days to maturity.

Interest Earned=(10,000−9,9509,950)×(36528)×100Interest Earned=(9,95010,000−9,950​)×(28365​)×100

$\text{Interest Earned}\approx 2.51\%$

So, in this example, the interest earned on the 4-week T-Bill would be approximately 2.51%.

FAQs?

Q1: Is the 4-week T-Bill a safe investment?

A1: Yes, T-Bills are considered one of the safest investments as they are backed by the U.S. government.

Q2: Can I sell my 4-week T-Bill before maturity?

A2: Yes, T-Bills can be sold on the secondary market before maturity, but the selling price may differ from the face value.

Q3: How often are 4-week T-Bills auctioned?

A3: 4-week T-Bills are typically auctioned every four weeks.

Conclusion:

The 4-week T-Bill calculator is a valuable tool for investors looking to assess the potential return on their short-term Treasury investments. By understanding the formula and utilizing the calculator, investors can make informed decisions about their T-Bill holdings, considering factors such as purchase price, face value, and days to maturity. Always stay informed about market conditions and consult financial professionals for personalized investment advice.