Non-competitive tenders are a type of bid offered by smaller investors when they purchase Treasury securities. This type of bid does not specify the price or terms of the security. Instead, the large institutional buyers who offer competitive bids determine the terms of the security.

In order to participate in a non-competitive tender, an investor must submit an offer to purchase Treasury securities worth between $10,000 and $500,000. Investors must also specify how much they are willing to pay for the security. The U.S. Treasury Department then processes the offers and the highest bidders for the security will win the auction. The terms of the security, such as the maturity date and coupon rate, are then set based on the competitive bids from large institutional buyers.

One of the advantages of using non-competitive tenders is that investors have guarantee of being able to purchase the security as long as their offer is within the Treasury’s set price range. This means investors know upfront what their maximum out of pocket cost is and can plan accordingly when investing. Additionally, the bidding process is faster and simpler than the competitive bidding process, meaning investors are able to quickly purchase Treasury securities.

Another advantage to non-competitive tenders is that they don't require a significant amount of capital. Since investors don’t need to commit a large amount of capital upfront, they can easily enter and exit securities with the right kind of budget.

Non-competitive tenders offer an easy way for smaller investors to purchase Treasury securities. The bidding process is simpler and doesn’t require a lot of capital and the pricing is more predictable. Since investors know the maximum amount they will pay upfront, it offers more predictability in times of uncertainty.