What are Treasury Bills, Notes and Bonds? A guide to Treasury Instruments

In the current climate, businesses are grappling with increasing uncertainty. As a result, businesses are inclined towards diversifying their investment portfolio more than ever before across asset classes and institutions. We’ve seen that startups, in particular, seek to minimize their exposure to any single institution and are focusing on investing in the to safeguard their investments. Among these are US Treasury Instruments. US Treasury Instruments, also known as Treasuries, are debt securities issued by the US government to fund its operations and pay for its obligations. They are backed by the full faith and credit of the US government that stands behind them. There are several different types of Treasury instruments available to investors, each with different characteristics and benefits.

• Treasury Bills (T-Bills): Treasury Bills are short-term debt securities with a maturity of less than one year. They are issued at a discount to their face value and pay no periodic interest payments. Instead, the investor receives the face value of the bill at maturity.
• Treasury Notes (T-Notes): Treasury Notes are medium-term debt securities with a maturity of between two and ten years. They pay interest every six months until maturity, at which point the investor receives the face value of the note. T-Notes are popular with investors who are seeking a balance between risk and return, as they offer a higher yield than T-Bills but are still considered to be low-risk investments.
• Treasury Bonds (T-Bonds): Treasury Bonds are long-term debt securities with a maturity of greater than ten years. Like T-Notes, they pay interest every six months until maturity, at which point the investor receives the face value of the bond. T-Bonds are popular with investors who are seeking a higher yield and are willing to take on more risk than T-Notes or T-Bills.

Treasury instruments, especially T-Bills, are highly liquid, which means that they can be easily bought and sold in the market. This makes them a great investment option for businesses that need to access their funds quickly. T-bills can be sold in the secondary market before their maturity date, which makes them a flexible investment option. They also offer a range of maturities and yields to meet the needs of different investors. They are considered to be among the safest investments available due to the backing of the US government. If you’re looking for a low-risk investment that offers stable returns, US Treasury instruments are a great place to start.

Varni Labs Inc. (“Zamp Finance”) is an SEC registered investment adviser. The material presented is for informational purposes only and should not be construed as investment advice. It is not a recommendation of, or an offer to sell or solicitation of an offer to buy, any particular security, strategy or investment product. Investing in securities involves risks, including the potential loss of money, and past performance does not guarantee future results.