Treasury notes are coupon bonds having a maturity ranging from 2 to 10 years. They are issued in denominations of $100 to $5 million and pay interest semiannually. Treasury notes are non-callable, guaranteeing the holder the stated yield to maturity.
Treasury bonds are coupon securities having maturities from 10 to 30 years. They are issued in denominations that range from $100 to $5 million and pay interest semiannually. Unlike Treasury notes, Treasury bonds may have a call feature. Prior to 1985 the Treasury issued bonds with a 5- or 10-year call feature, and while it has not done so since, it is not precluded from doing so in the future.
The 30-year bond is often called the “long bond” by traders, because it has the longest maturity of government bonds. It serves as a benchmark of long-term financing in the U.S. and an indicator of the direction of interest rates.
