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.
King Charles banknotes to enter circulation in June
New banknotes featuring the King will enter circulation on 5 June – here’s what they will look like and what you need to know about your old notes.
By Katie Williams Published
Metro Bank to slash 5.22% savings rate for current customers- what’s the next best alternative?
Metro Bank is set to cut the rate on its best buy instant access saver for existing customers. Is there an alternative on the market and should you switch now?
By Vaishali Varu Published