Treasuries
A government bond is an IOU issued by the central bank, which it guarantees to repay at a given date. In the US, these are referred to as Treasuries.
A government bond is an IOU issued by the central bank, which it guarantees to repay at a given date. In the US, these are referred to as Treasuries. They are divided into three types of marketable securities: Treasury bills, Treasury notes and Treasury bonds.
Treasury bills are short-term securities that mature at three, six or 12 months and cost less than their eventual worth or face value. Treasury notes mature two to ten years after they're issued. Treasury bonds mature after up to 30 years. Both notes and bonds are coupon securities - that is, they pay interest every six months, plus a lump sum at maturity.
Treasury bonds issued by a stable country are generally seen as 'safe' investments.
MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
-
Lifetime ISA reform: Retirement option could be scrapped in overhaulA consultation on a product replacing the Lifetime ISA is set to be launched this year, and the option to use it to save for retirement is expected to be axed in the shake-up
-
HMRC stamp duty crackdown sees probes of property deals jump 88% – what to watch out forFrom bogus stamp duty refund claims to misleading the taxman about who owns a property, HMRC is increasing its scrutiny of stamp duty land tax reporting. Here’s how.
