Why the 19 October Treasury Bill Shows 4.095% and 4.195%

Treasury's 19 October 2026 auction result for a 13-week bill printed 4.095% beside the high rate and 4.195% beside the investment rate. The price was $98.964875 per $100 of face value. Those two annual rates describe the same bill and the same maturity payment.

For a hypothetical $10,000 face-value purchase at that auction price, the cost would be about $9,896.49 and the difference paid at maturity about $103.51, before costs and taxes. The return over the bill's remaining 91 days is approximately 1.046% of the purchase price. Reading 4.195% as the return earned during those 91 days would overstate the cash payment.

That distinction matters when a bill rate sits beside an options premium percentage in a research spreadsheet. The time period and the denominator both need a label before the numbers can be compared.

The result fixes a security, price and period

The Treasury auction result identifies CUSIP 912797TM9, a 91-day bill with an issue date of 22 October 2026 and a maturity date of 21 January 2027. The result was released on 19 October. The 91-day measurement runs from issue to maturity, rather than from the auction date.

These are auction terms. The reported price is not a current secondary-market quote or a promise that somebody researching the bill later can buy it at that price. The document also shows an original issue date of 22 January 2026. That earlier date does not extend the remaining 91-day term used in this auction's pricing calculation.

This article uses the 19 October result as observed on 20 October in Australia/Brisbane. The latest completed NYSE core equity session was Monday 19 October, ending at 4 p.m. Eastern Daylight Time, or 6 a.m. Tuesday in Brisbane. That session boundary does not establish a Treasury-market close, an options cutoff, a closing yield or any market reaction to the auction.

The discount rate starts with face value

TreasuryDirect's pricing guide calculates a bill price by subtracting a time-scaled discount from face value. The discount-rate convention uses a 360-day year.

For this auction, the calculation per $100 of face value is:

$100 x [1 - (0.04095 x 91 / 360)] = $98.964875

The discount is $1.035125 per $100 face value. Divide that discount by $100, then annualize on the 360-day convention, and the result is the 4.095% high discount rate shown by Treasury.

The investor pays less than $100 for the stated $100 maturity payment. Measuring the gain against the lower purchase price produces a larger percentage than measuring it against face value, before any difference in annualization.

The investment rate changes the denominator and annual scale

Treasury calls the result's investment rate an equivalent coupon-issue yield. Its glossary describes the investment rate as an annualized simple rate without compounding. For the 91-day bill here, the conversion uses the purchase price and a 365-day year.

The three measures can be reproduced from the same price:

Measure: Holding-period return. Denominator and time basis: $1.035125 gain divided by $98.964875 paid, for 91 days. Result: About 1.046%.

Measure: High discount rate. Denominator and time basis: $1.035125 divided by $100 face value, multiplied by 360/91. Result: 4.095% annually.

Measure: Investment rate. Denominator and time basis: $1.035125 divided by $98.964875 paid, multiplied by 365/91. Result: 4.195% annually, rounded.

The investment-rate arithmetic is approximately:

($1.035125 / $98.964875) x (365 / 91) x 100 = 4.195302%

Treasury prints that result to three decimal places as 4.195%. The annualized figure does not add another payment to the bill. Nor does this simple annualization assume that interest compounds at the same rate for a full year. A later reinvestment would have its own available terms.

Follow the dollars through one hypothetical holding

Assume a fictional investor acquires $10,000 face value at the published auction price and holds the bill to maturity. No actual investor transaction is claimed. The illustration omits brokerage charges, other transaction costs, taxes and currency conversion.

Scaling the price by 100 gives an unrounded purchase amount of $9,896.4875. Rounded to cents, that is $9,896.49. Under the bill's stated terms, the maturity payment is $10,000, leaving approximately $103.51 above the purchase amount.

The 1.046% holding-period calculation uses the unrounded price to avoid intermediate rounding. Using the cent-rounded cash figures leaves the same percentage at three decimal places. Multiplying $10,000 by 4.195% instead would produce $419.50, but that combines an annual rate with the wrong period and the face-value denominator. It does not describe this bill's 91-day cash difference.

An early sale would be a separate calculation. The sale price and costs would replace the assumed $10,000 maturity payment, and the number of days held would change. TreasuryDirect's bill guide distinguishes holding to maturity from selling before maturity.

An options comparison still needs a loss calculation

A quoted option premium percentage may divide the opening credit by strike cash, margin, share cost or another capital amount. Its period may be days to expiration rather than the term used by the bill. Even after aligning those labels, the premium alone leaves out what the option obligation can cost.

FINRA explains that an option seller can be assigned and required to buy or sell the underlying under the contract. Equity-option assignment can occur before expiration. Buying back an option can cost more than the original premium, and poor liquidity or a wide bid-ask spread can make an exit more expensive. Some strategies can lose more than the initial investment.

The earlier article on Treasury-bill maturity and short-put expiration addresses the resulting form of capital. The article on a 30-day put premium and an annual income plan addresses repeated future contracts. Here, the narrower task is to identify which rate describes a known price and term before attempting either comparison. The liquidity and bid-ask spread guide covers execution limits.

For a research sheet, record the amount paid, the stated or conditional ending cash flow, the number of days and the annualization convention in separate fields. Then calculate the possible loss, costs and access to cash alongside the headline percentage.

Sources and scope

Sources checked on 20 October 2026 Australia/Brisbane include Treasury's 19 October 13-week auction result, pricing guide, glossary, bill guide, 31 CFR Part 356 Appendix B, section VI, the NYSE hours and holiday calendar, FINRA's options guide and the OCC options disclosure document page.

The auction release is dated 19 October and is not labelled preliminary or revised. It gives no publication time of day. Calculations are author arithmetic from that dated result; the $10,000 holding is hypothetical. No current executable quote, market-price cause, future auction rate or investment recommendation is asserted.

This is general U.S. financial education, not personal financial, investment, tax or legal advice. Taxes, currency movements for a non-U.S.-dollar investor, transaction costs and account access can change a person's outcome. Options involve risk and are not suitable for everyone; read the current OCC disclosure before trading. Options Matrix Pro produces this education and has a commercial interest in its analysis tools. Our editorial policy explains that relationship.