The Ten Year Treasury Note

WHAT IT IS – HOW IT WORKS – WHY?

By Staff Reporters

***

10-Year Note

What it is: The 10-year Treasury note is a debt instrument the U.S. government issues to fund itself. The Federal Reserve closely watches the “yield” (i.e. the return on investment) as a benchmark for other interest rates.

How it works: The U.S. Treasury issues bonds that are auctioned to investment banks by the Federal Reserve; banks can then sell those bonds to investors. The 10-year matures over—you guessed it—10 years, with interest paid out every six months until the full value is paid out at the end.

Why it matters: The 10-year is considered another safe-haven asset for investors. But as demand goes up, the yield goes down. Investors can even end up paying more than the face value of the Treasury note (but some are willing to accept the tradeoff for the low-risk investment).

CITE: https://www.r2library.com/Resource/Title/082610254

***

COMMENTS APPRECIATED.

***

Thank You

***

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: