Debt Flashcards
1
Q
T Bills
A
Short Term
1 month - 1 year
ST zero coupon
Interest upon maturity
T + 1 Non Callable
2
Q
T Notes
A
Intermediate
1-10 Years
% of par (32nds)
Semiannual Interest
T + 1 Non Callable
3
Q
T Bonds
A
LT
10-30 Years
% of par (32nds)
Semiannual Interest
T + 1 Non callable
4
Q
TIPS
A
- Treasury Inflation Protected Securities
- Principle adjusted semiannually based on CPI
- Guarantee consistent payment w/ consideration to inflation
- Lower rates bc safer
5
Q
STRIPS
A
- Zero coupon bonds
- “Stripped” of coupons
- No reinvestment risk
- High IR risk
6
Q
Treasury Reciepts
A
- Basically same as STRIPS
- Middleman (broker) buys a T bond and takes out coupons then resells
7
Q
Ginnie Mae
A
- GOV
- Pays interest and principle monthly
- Only for gov purposes
- Pays all taxes
8
Q
Freddie Mac
A
- Only buys conventional mortgages
9
Q
Fannie Mae
A
- Can buy both gov and conventional mortgages
10
Q
Sallie Mae
A
- Student Loans
- Smaller
- Sells securities backed by student loans
11
Q
Certificate of Protection (COP)
A
- Pledges rev from a project
- Not legally obligated to pay
- Loophole when they can’t issue more debt for GO bonds
- Riskier and higher yield than GO
12
Q
Secured vs Unsecured
A
- Secured = Collateral
13
Q
Treasury Settle?
A
T + 1
14
Q
Corporate/Muni/Commercial Paper
A
T + 2
15
Q
Term
A
- Issued on one date and all mature on one date in future
