On-The-Run Treasuries (OTR)

Search Dictionary

Definition of 'On-The-Run Treasuries (OTR)'

On-The-Run Treasuries (OTR) are the most recently issued United States Treasury Bond or Note of a given maturity. Compare these to their opposite of Off-The-Run Treasuries.

As a bond ages it no longer falls into the maturity that it was initially issued under. For example, one year after a 5-year bond was issued it is now a 4-year bond and traders wanting to trade 5-year bonds would be reluctant to trade the older bond if a new 5-year On-The-Run treasury has been issued.

The On-The-Run Bond or Note is the most frequently traded Treasury Security for its maturity. As such, it will be more liquid, more expensive (high demand) and have a lower yield than its Off-The-Run counterpart.

Do you have a trading or investing definition for our dictionary? Click the Create Definition link to add your own definition. You will earn 150 bonus reputation points for each definition that is accepted.

Is this definition wrong? Let us know by posting to the forum and we will correct it.