treasury bills (t-bills)

Treasury bonds are financial instruments that represent a form of non-cash securities issued by the state or its bodies and state institutions. They are aimed at raising financial resources for government needs or serve to regulate liquidity in the financial market.

How do treasury bonds work?

Treasury bonds are issued with a specific maturity date, after which the bondholder receives a return of the invested capital plus interest. They are considered one of the safest financial instruments because they are issued by a state with a solid market position.

Types of treasury bonds

There are several types of treasury bonds, including:

– Short-term treasury bonds: issued for a short period of time, usually up to one year. They mainly serve to secure the state’s current financial needs.

– Long-term treasury bonds: issued for a longer period, often from one to several years. They are an important tool for the state’s public debt.

Benefits of investing in treasury bonds

Investing in treasury bonds can be advantageous for several reasons:

– Low risk: due to the issuer (the state), they are considered safe investments.

– Fixed interest rates: treasury bond holders receive fixed interest, providing certainty regarding the return on investment.

– Availability in the secondary market: the possibility of selling treasury bonds before maturity in the secondary market ensures investment liquidity.

Summary

Treasury bonds are an important financial instrument used by states to raise capital and regulate liquidity in the market. Due to their stability and certainty of return, they are an attractive form of investment for those seeking safe financial instruments.