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Investors who can't or don't wish to meet the minimum purchase requirements for competitive bidding on Treasury bills or notes may enter a noncompetitive bid.
You can invest as little as $1,000 or as much as $5 million in each new issue through Treasury Direct. Treasury Direct is a system that allows you to buy government securities without going through a bank or a brokerage firm.
The Treasury sells T-bills, for example, to all noncompetitive buyers whose bids arrive by the weekly deadline, for a price equal to what competitive bidders pay for that week's issue.
A noncompetitive bid may also be known as a noncompetitive tender.
- Browse Related Terms: Crossed market, Dutch auction, Market order, National Market System (NMS), Noncompetitive bid, Offer, Order imbalance, Order protection rule, Small order execution system (SOES), Specialist, Spoofing, Tender offer, Toehold purchase