Master Notes

AAA

DEFINITION of 'Master Notes'

High-quality, short-term debt instruments offered by the Federal Farm Credit Bank (FFCB) with a minimum face value of $25 million. Master notes typically mature in one year, paying interest that is indexed to LIBOR or another appropriate index. Due to the high value of each note, these instruments are normally used by money managers who require highly liquid, customizable investments.

INVESTOPEDIA EXPLAINS 'Master Notes'

Master notes typically have an embedded put/call feature that is advantageous to most money managers. These embedded options may limit the frequency of purchases or sales of money market instruments such as discounted notes, and allow for the daily ability to adjust total value, either upwards or downwards, by 25% of the base principal.

RELATED TERMS
  1. LIBOR

    LIBOR or ICE LIBOR (previously BBA LIBOR) is a benchmark rate ...
  2. Principal

    1. The amount borrowed or the amount still owed on a loan, separate ...
  3. Discount Note

    A short-term debt obligation issued at a discount to par. Discount ...
  4. Money Manager

    A business or bank responsible for managing the securities portfolio ...
  5. Surrender Period

    The amount of time an investor must wait until he or she can ...
  6. Nelson Peltz

    One of the most successful activist investors in the financial ...
Related Articles
  1. Bonds & Fixed Income

    Advanced Bond Concepts

  2. Retirement

    Bond Basics Tutorial

  3. Bonds & Fixed Income

    How long will it take for a bond to ...

  4. Bonds & Fixed Income

    What determines the price of a bond ...

Hot Definitions
  1. Turkey

    Slang for an investment that yields disappointing results or turns out worse than expected. Failed business deals, securities ...
  2. Conduit Issuer

    An organization, usually a government agency, that issues municipal securities to raise capital for revenue-generating projects ...
  3. Financing Entity

    The party in a financing arrangement that provides money, property, or another asset to an intermediate entity or financed ...
  4. Hyperinflation

    Extremely rapid or out of control inflation. There is no precise numerical definition to hyperinflation. Hyperinflation is ...
  5. Gross Rate Of Return

    The total rate of return on an investment before the deduction of any fees or expenses. The gross rate of return is quoted ...
  6. Debit Spread

    Two options with different market prices that an investor trades on the same underlying security. The higher priced option ...
Trading Center