Municipal Securities and U.S. Treasury Securities

These flashcards cover key terms and concepts related to municipal securities and U.S. Treasury securities, providing definitions for important terms to aid in studying.

Municipal Securities

Debt securities issued by municipal entities such as states, cities, or local government agencies to finance public projects.

General Obligation Bonds (GOs)

Municipal bonds backed by the full faith and credit of the issuer, supported by ad valorem taxes.

Revenue Bonds

Municipal bonds backed by the revenue from a specific project or source, rather than by taxing power.

Official Statement (OS)

A document prepared by issuers of municipal securities that provides detailed information about the security, including risks and financial data.

Tax-Equivalent Yield

The yield an investor would need to earn on a taxable investment to equal the yield on a tax-exempt municipal bond.

Callable Bonds

Bonds that can be redeemed by the issuer before their scheduled maturity date.

STRIPS

Separate Trading of Registered Interest and Principal of Securities; zero-coupon bonds derived from U.S. Treasury issues.

Treasury Bills (T-Bills)

Short-term government securities with maturities of one year or less, sold at a discount from par value.

Treasury Inflation-Protected Securities (TIPS)

Treasury securities that provide protection against inflation by adjusting the principal based on the Consumer Price Index.

Pass-Through Certificates

Securities backed by mortgage loans where the principal and interest payments are passed through to investors.