| a note or bill issued by the U.S. Department of the Treasury, receivable as legal tender for all debts except as otherwise expressly provided. |
| Treasury note n. An intermediate-term obligation of the U.S. Treasury having a maturity period of one to ten years and paying interest semiannually. |
Treasury Note
A marketable, U.S. government debt security with a fixed interest rate and a maturity between one and 10 years. T-notes can be bought either directly from the U.S. government or through a bank.
When buying from the government you can either put in a competitive or noncompetitive bid. With a competitive bid you specify the yield you want; however, this does not mean your bid will be approved. With a noncompetitive bid is one where you accept whatever yield is determined at auction.
Investopedia Commentary
T-notes are extremely popular investments as there is a large secondary market that adds to their liquidity. Interest payments on the notes are made every six months until maturity. The income for interest payments are not taxable on a municipal or state level but are federally taxed.
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See also: Government Security, Maturity, Off-the-run Treasuries, On-the-run Treasuries, Secondary Market, Treasury Bill, Treasury Bond
Also spelled: T-notes
Treasury note