Tuesday, September 21, 2010

How do I compare discount to yield to figure the actual profit on a 3/mo t-bill?

I am confused about the current profitability (if any) of 3-month treasury bills. I have been to Bloombergs', etc.--but I am lost on what the terminology means--as I am reading it, there is currently very little difference between the discount (the actual price) of the bill--and the yield--less than 1%. Does this mean that a $10,000.00 t-bill would cost about 9,900 dollars, and yield perhaps $100.00 profit/$9900.00 oinvested--or am I reading the charts incorrectly--and if so, what, generally, is the profit per $9500.00 loaned--and how SHOULD I be reading the charts?