Business and Personal Finance Dictionary

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• US TREASURY BILLS
  
  Treasury bills have maturities of 3 months and 6 months. They are auctioned once every week. Once every month 1 year T-bills are auctioned. These are a direct short term obligation of the U.S. government. T-bills do not pay interest. They are purchased at a discount. For example, one might buy a $10,000 three month T-bill for $9,700. The investor would then receive $10,000 when the T-bill reached maturity in 3 months. T-bills are the only Treasury security issued at a discount. They are also the only Treasury security issued without a stated interest rate. The interest rate is determined at auction. T-bills are also offered in Book Entry form only. The investor does not receive a certificate. T-bills are also highly liquid.
  
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