Treasury security Guide, Meaning , Facts, Information and Description
Treasury Securities are bonds issued by the U.S. Federal Reserve. They are debt finance instrument of the Federal government. There are four types of treasury securities. They are Treasury Bills, Treasury Notes, Treasury Bonds, and Savings Bonds. All of the treasury securities besides Savings Bond are very liquid. They are heavily traded on the secondary market.
Treasury Bills (a.k.a. T-Bill) mature in less than one year. They are zero-coupon bonds. They are sold at a discount of the par value to create a positive yield to maturity. Treasury bills are considered by many the most risk free investment. Treasury Bills are commonly issued with maturities dates of 91 days, 6 month, or 1 year.
Treasury Notes (a.k.a. T-Note) mature between one and ten years. They have coupon payment every six months. There are two kinds of Treasury Notes. They are fixed principal and inflation indexed Treasury Notes. Inflation Indexed Notes adjust the principal for inflation. Treasury Notes are commonly issued with maturities dates of 2, 3, 5 or 7 years.
Treasury Bonds (a.k.a. T-Bond) mature in more than ten years. They have coupon payment every six months like T-Notes. Treasury Bonds are commonly issued with maturity dates of ten and thirty years. Treasury Bill
Treasury Note
Treasury Bond