|U.S. Treasury bonds, also known as long bonds, are issued in 30-year terms.
The T-bond is a coupon bond like the T-note with interest paid over the term of the bond.
T-bonds are also publicly auctioned at issue and have an active secondary market.
Treasury bonds also frequently trade at a premium to the par value of the bond because the revenue stream from the coupons is greater than the interest that can be achieved from other high credit-rated investments.
Long bonds with higher interest-rate coupons that were auctioned during periods of higher interest rates will trade at a substantial premium to the par value during periods when current interest rates are low.
As an example a 6 percent 30-year T-bond that has, say, 15 years left, may trade at 120 percent of par value when interest rates are lower. In contrast, as interest rates rise, the secondary market value of long bonds will fall.
Treasury inflation-protected securities (TIPS) are inflation-indexed bonds issued by the U.S. Treasury. The rate of return ...
Treasury notes are issued in terms of 2, 3, 5, 7, and 10 years. T-notes, ...
A debt obligation issued by a government (i.e., Treasury bond) or corporation (i.e., corporate bond) that ...
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