About Government/Agency Bonds
One of the world’s largest and most liquid bond markets is comprised of debt securities issued bythe U.S. Treasury, by U.S. government agencies and by U.S government-sponsored enterprises.U.S. Treasury securities, used to finance the federal government debt, are also considered to havethe bond market’s lowest risk because they are guaranteed by the U.S. government’s “full faith andcredit” or, in other words, its taxing authority. Government agencies and government-sponsoredenterprises such as Ginnie Mae, Fannie Mae and Freddie Mac also issue debt to support their rolein financing mortgages.Use this section to learn more about:
The different types of U.S. government and agency securities
The advantages and risks of investing in Treasuries and government securitiesGo to theGovernment/Federal Agency Market At A Glance page to get news affecting thegovernment and federal agency bond markets as well as recent price and yield information on:
Treasury bills with maturities of less than one year
Treasury notes with maturities between one and ten years, and
Treasury bonds with maturities of 10 years or more
Federal agency bondsStay informed on government bond market news and opportunities by visiting this page often for new content and market information.
Agency bonds are issued by two types of entities—1) Government Sponsored Enterprises (GSEs),usually federally-chartered but privately-owned corporations; and 2) Federal Government agencieswhich may issue or guarantee these bonds—to finance activities related to public purposes, such asincreasing home ownership or providing agricultural assistance. Agency bonds are issued in avariety of structures, coupon rates and maturities.Each GSE and Federal agency issues its own bonds, with sizes and terms appropriate to the needsand purposes of the financing. There are usually minimums to invest in agency bonds—$10,000for the first investment and increments of $5,000 for additional investments. Investing in GinnieMae Federal Agency bonds requires a $25,000 minimum investment. The degree to which anagency bond issuer is considered independent from the federal government impacts the level of itsdefault risk. The interest from most but not all agency bond issues is exempt from state and localtaxes; some of the biggest issuers such as GSE entities Freddie Mac and Fannie Mae are fullytaxable.