Treasury Notes are sold at public auctions every month by means of a competitive bid. The interest rate paid for any issue is determined by this auction process.

Treasury Notes range in maturities from 2 to 10 years with the most popular maturities being:

• 2-Year Treasury Notes
• 3-Year Treasury Notes
• 5-Year Treasury Notes
• 7-Year Treasury Notes
• 10-Year Treasury Notes

These notes pay interest every six months which means that you will receive half of the stated coupon rate of the face value of the bond every six months. If you hold $1,000,000 in Treasury Notes and the coupon rate is 12% you would be entitled to $120,000 per annum and that would be paid as $60,000 twice a year.

Compare this to Treasury Bills which are always sold at a discount and do not pay coupons (interest).

Bills sell in minimum increments of $100 face value. i.e. the amount you will pay for the bill will be less than that but the maturity value will be in those increments.

Compare the following Treasury instruments:

• Treasury Bills (T-Bills)
• Treasury Notes, (T-Notes)
• Treasury Bonds, (T-Bonds)
• Treasury Inflation-Protected Securities (TIPS)
• Treasury STRIPS

Check the Economic Events Calendar to see if this or other announcements are taking place in the next 5 days.