What Is A Treasury Bond?
A treasury bond (also known as a T-Bond) is a long-term, interest-bearing bond issued by the US Treasury.
Treasury bonds are fixed-interest US government debt securities that are issued with maturities greater than ten years—often 30 years. Interest is paid twice annually. Because of the reliability of the US Treasury and, therefore, low risk of the investment, the yields on treasury bonds are typically lower than other bonds. Treasury bonds are exempt from local and state taxes but subject to federal income taxes.
Treasury bonds can be purchased through a broker or through the US government directly. The minimum purchase is US$100, with a maximum of US$5 million. Bonds can be held to maturity or sold before maturity.
Russell Shor (MSTA, CFTe, MFTA) is a Senior Market Specialist at FXCM. He joined the firm in October 2017 and has an Honours Degree in Economics from the University of South Africa and holds the coveted Certified Financial Technician and Master of Financial Technical Analysis qualifications from the International Federation…