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| This article is part of WikiProject Definitions. Consider editing to improve it. View articles referencing this definition. |
Treasury bills, notes, and bonds are examples of default-free securities. They are issued by the Treasury of the United States Government. However, most governments around the world also issue their own equivalent, which are also assumed to be default-free. However, it is important to note that while they are assumed to be default-free, many third-world governments have defaulted in the past. It is important to note that while they are default-free, they are not risk-free since they may lose value due to the time-value of money and a change in the global exchange rate.
[edit] Kinds of Treasury Securities
- Treasury Bills
- Treasury Notes
- Treasury bonds
- Treasury Inflation-Protected Securities (TIPS)
- Treasury STRIPS
[edit] Purchasing Treasury Securities
One of the greatest features of a Treasury security is that any individual may purchase them without the use of an intermediary. Individual investors may log on to TreasuryDirect to participate in an auction. Investors may also ask brokers and other intermediaries to purchase them, however, they may charge a fee. It is important to note that everyone who successfully bids at a Treasury securities auction receives the largest accepted rate.
[edit] Price Fluctuation of Treasury Securities
The change in yield of a Treasury security is monitored by tracking changes to the ten-year Treasury note. //pick off here.
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