Treasury bills are short-term public debt securities (fixed income) issued by the Treasury as a method of financing the State. They are issued at a discount, for a nominal value of 1,000 euros and with maturities of three, six or twelve months.
They are debt instruments very similar to government bonds, but with a much shorter maturity. Generally, as they are very safe securities, they offer lower yields than private debt, as their risk is lower.
The fact that they are issued at a discount means that they are acquired below their nominal value (1,000) and at the end of the bill's life, the investor receives the nominal value. The difference between the price and the nominal value is the interest rate of the Treasury Bill.
Related terms
Bonds | Debt | Public Debt | Yield | Fixed income | Nominal value