Treasury Bills

QUOTE AND NEWS
Financial Times  Jul 19  Comment 
Conservative investors seeking a pause from Wall Street have an option in ‘cash’
Financial Times  Jul 17  Comment 
Fed chair testimony on likely rate rises drives shift above key measure
MarketWatch  Jul 16  Comment 
Government-backed cash-equivalent offers more yield and greater liquidity.
Motley Fool  Apr 19  Comment 
There's one major difference: time.
Financial Times  Mar 12  Comment 
Two-month T-bill could help government tap demand for shorter-dated debt and help fund the deficit




 
TOP CONTRIBUTORS

The graph to the left is the discount rate for T-Bills with a 3-month maturity.

Treasury bills are short-term debt securities issued by the U.S. Government. They are issued in lengths of four weeks (30 days), three months (90 days), six months (180 days), and one year (360 days). However, the one year bill is currently no longer issued. Treasury bills are known as a zero coupon, or discount security, since it pays the interest and principal at maturity.

The rates listed on Treasury bills are known as discount rates. However, it is important know two things when purchasing Treasury bills:

  1. The discount rate is annualized
  2. The Treasury assumes that a year has 360 days

Formula

Image:Treasury_Bill_Discount.png


Image:Treasury_Bill_Yield.png

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