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Plain-English guides to Treasury yields, bills, notes and bonds, the yield curve, basis points and savings bonds, plus a glossary of key terms.

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New to Treasury securities? Read these in order:

  1. What Is a Treasury Yield?
  2. Treasury Bill vs. Treasury Note vs. Treasury Bond
  3. What Are Basis Points?
  4. What Is a Treasury Yield Curve?

Glossary

Basis point (bp)
One hundredth of a percentage point (0.01%). 25 basis points = 0.25 percentage points.
Bond-equivalent yield
An annual yield calculated on the price paid and a 365- or 366-day year, comparable with yields on coupon-paying notes and bonds. For bills, TreasuryDirect calls it the investment rate.
Coupon
The fixed interest rate a note or bond pays, usually in two payments a year.
Discount rate (bank discount yield)
A bill yield calculated on face value and a 360-day year. It is lower than the investment rate for the same bill.
Face value (par)
The amount a Treasury security pays at maturity.
Inverted yield curve
When shorter-term yields are higher than longer-term yields.
Maturity
The date a security pays back its face value. Also used for the length of time until that date.
Par yield curve
The Treasury’s daily curve of yields at which hypothetical new securities would trade at face value, for maturities from 1 month to 30 years.
Spread
The difference between two yields, usually in basis points.
TreasuryDirect
The U.S. Treasury’s website for buying and holding Treasury securities and savings bonds directly.
Yield
The annual return on a security based on its price, expressed as a percentage.

Our approach to financial education

Our guides explain concepts in plain English, link to primary sources such as the U.S. Department of the Treasury and TreasuryDirect, and avoid predictions or personal advice. Read our editorial policy to see how we write, review and correct content.