noob question on treasury yield

[madknife]

from wsj: http://online.wsj.com/mdc/public/page/2_3020-treasury.html?mod=mdc_bnd_pglnk

the first line in treasury notes shows that for the notes maturing on Aug 15, the coupon is 2.75%, the prices are almost at face value, but the yield is 4.31%... why is that? i always thought the yield is the coupon rate plus the price discount? i.e., coupon is 1%, but price is half of face value, then your actual yield would be 2%?
really confused here...:confused:

[15-20_God]

but the yield is 4.31%... why is that?

the yield is annualized.

[charliebrown]

from wsj: http://online.wsj.com/mdc/public/page/2_3020-treasury.html?mod=mdc_bnd_pglnk

the first line in treasury notes shows that for the notes maturing on Aug 15, the coupon is 2.75%, the prices are almost at face value, but the yield is 4.31%... why is that? i always thought the yield is the coupon rate plus the price discount? i.e., coupon is 1%, but price is half of face value, then your actual yield would be 2%?
really confused here...:confused:

hmm...i thought yield to maturity is annualized.

so, you pay 99.XX, pay the accrued interest, get the coupon + 100 on Aug 15; and for all that trouble over the next 15 days, your annualized return = 4.31%

[madknife]

hmm...i thought yield to maturity is annualized.

so, you pay 99.XX, pay the accrued interest, get the coupon + 100 on Aug 15; and for all that trouble over the next 15 days, your annualized return = 4.31%

ah! thanks! better to stick with my ICICI HiSavings account then :P

[Thalo]

Even if you had a million dollars you'd be better off keeping it in high interest savings or shopping around GIC/term rates. Plus, how are you going to buy the t-bill? The yields listed there don't include the comission taken off by the bank or broker by way of the spread (ie: they won't sell to you at 99.30, probably more like 99.35, reducing your YTM).