Michael J Porro & Company

Financial Advisors, LLC

180 Old Tappan Road, Old Tappan, NJ 07675-7052

Phone: 201-768-0218

Fax: 201-768-6487

Website: porrofinancialadvisors.com

May/June 2018

Notes, Bills and Bonds

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Bonds aren’t the only type of fixed-income investing. In the world of debt instruments, bonds, bills and notes differ by their maturity, or when they pay interest.


Bonds mature in one to 30 years. A long-term bond matures in 10 or more years, intermediate-term bonds go from four to 10 years and short-term bonds mature in one to four years. The longer the maturity, typically the higher the interest rate.

Notes maturity dates are similar to those of intermediate and short-term bonds. They typically mature in one to 10 years.

Bills mature in one year or less. They typically offer the lowest interest rate return.
Interest Rates

If you own any of these debt instruments and interest rates rise, your investment could be worth less because it has a lower interest rate. Bills, with their short terms, are considered less sensitive to interest rate changes. They turn over quickly. Conversely, long-term bonds are the most affected when rates change.


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