Corporate bonds & discount notes
 

Federal Agency Discount Notes

Similar to Treasury Bills, Agency discount notes are issued by Federal Agencies at a discount to their maturity value (hence they are called discount notes). Discount notes are sometimes called Federal Agency discount notes.

What is an agency discount note?

An agency discount note is a short term investment alternative, typically available on a daily basis, through several different dealer firms. An Agency discount note has maturities ranging from overnight to 360 days.

Typically, Agency Discount Notes provide investors with:
  • Yield advantage over Treasuries
  • High credit quality
  • Wide variety of short-term maturities
  • State and local tax-exempt interest (in some cases)
  • High degree of liquidity

To help you understand Federal Agency securities and Agency discount notes in particular, we’ve compiled investors’ top questions:

 


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