Intermediate/Medium-Term Debt
Definition of 'Intermediate/Medium-Term Debt'A type of fixed income security with a maturity, or date of principle repayment, that is set to occur in the next 3-10 years. Bonds and other fixed income products tend to be classified by maturity date, as it is the most important variable in the yield calculations. In a standard (or positive) yield curve environment, intermediate-term bonds pay a higher yield for a given credit quality than short-term bonds, but a lower yield compared to long-term (10+ years) bonds. |
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Investopedia explains 'Intermediate/Medium-Term Debt'In recent years, there has been a steady decline in the issuance of long-term bonds (those maturing in over 10 years). In fact, the 30-year U.S. Treasury bond was discontinued in 2002 as the spread between intermediate-term and long-term bonds reached all-time lows. While the 30-year Treasury was revived in 2006, for many fixed income investors, the 10-year bond became the "new 30 year", and was considered the benchmark rate in many calculations. |
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