How Treasury Bills Differ from Bonds

How Treasury Bills Differ from Bonds

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Treasury bills are issued by governments to raise short-term funds. They have a maturity period of less than one year and are considered to be one of the safest investment options, as they are backed by the government. Treasury bills provide a guaranteed return and are easily tradable, making them a liquid investment option. They also offer a lower yield than other debt instruments, such as bonds and debentures, as they have a shorter maturity period. Thus, the main features of treasury bills include a guaranteed return, easy tradability, and a lower yield than other debt instruments.

Treasury bills and bonds are both issued by governments to raise money, but they differ in several ways. The main difference between treasury bills and bonds is their maturity period. Treasury bills have a maturity period of less than one year, while bonds have a maturity period of more than one year. Treasury bills are short-term debt instruments, while bonds are long-term debt instruments. Treasury bills also offer a lower yield than bonds, as they have a shorter maturity period.

Treasury bills and bonds are both issued by governments to raise money, but they differ in several ways. The main difference between treasury bills and bonds is their maturity period. Treasury bills have a maturity period of less than one year, while bonds have a maturity period of more than one year. Treasury bills are short-term debt instruments, while bonds are long-term debt instruments. Treasury bills also offer a lower yield than bonds, as they have a shorter maturity period.

The Government of India treasury bills are available in three different maturities, namely, 91 days, 182 days, and 364 days. These bills are issued by the RBI on behalf of the government and are considered to be one of the safest investment options in India. The 91-day Treasury bill is the most popular and widely traded, while the 364-day Treasury bill is gaining popularity due to its higher yield. These bills provide a guaranteed return and are easily tradable, making them a liquid investment option.

The easiest way to buy treasury bills in India is through an online platform. The Reserve Bank of India (RBI) offers an online platform called the e-Kuber system, which allows investors to buy treasury bills directly from the RBI. Investors can register for the e-Kuber system by providing their PAN card details and other relevant information. Once registered, they can submit an application for buying treasury bills online. Thus, treasury bills and bonds are both debt instruments issued by governments to raise funds, but they differ in their maturity period and yield. Also, treasury bills are short-term debt instruments with a maturity period of less than one year. Hence, depending on requirement and convenience, investors can procure the best treasury bills.