Note

AAA

DEFINITION of 'Note'

A financial security that generally has a longer term than a bill, but a shorter term than a bond. However, the duration of a note can vary significantly, and may not always fall neatly into this categorization. Notes are similar to bonds in that they are sold at, above or below face (par) value, make regular interest payments and have a specified term until maturity.

INVESTOPEDIA EXPLAINS 'Note'

U.S. Treasury notes, for example, are sold in $100 increments; come in terms of two, three, five, seven and 10 years; pay interest in six-month intervals; and pay investors face value upon maturity. There are numerous types of notes, including mortgage-backed notes, unsecured notes, municipal notes, bank notes, euro notes, promissory notes, demand notes and structured notes.

RELATED TERMS
  1. Mortgage

    A debt instrument, secured by the collateral of specified real ...
  2. Floating-Rate Note - FRN

    A note with a variable interest rate. The interest rate is usually ...
  3. Promissory Note

    A financial instrument that contains a written promise by one ...
  4. Note Notice

    A notice that a lender mails to borrowers notifying them that ...
  5. Member Payment Dependent Note

    A note that is issued by Lending Club. The income from these ...
  6. Loan Participation Note - LPN

    A fixed-income security that permits investors to buy portions ...
RELATED FAQS
  1. What's the difference between bills, notes and bonds?

    Treasury bills (T-Bills), notes and bonds are marketable securities the U.S. government sells in order to pay off maturing ... Read Full Answer >>
  2. What are the main risks to the economy of a country that has implemented a policy ...

    The main risk to the economy of a country that has implemented a policy of austerity is the potential for a self-reinforcing, ... Read Full Answer >>
  3. Which economic factors impact treasury yields?

    The economic factors that impact Treasury yields are interest rates, inflation and economic growth. All of these factors ... Read Full Answer >>
  4. What is meant by off-the-run treasuries?

    Off-the-run Treasuries have already been published and are currently out on the market. Yield and price quotes published ... Read Full Answer >>
  5. How can I tell if a security is considered investment grade?

    It is possible to tell if a security is considered to be investment grade by looking at that security's ratings with either ... Read Full Answer >>
  6. What is the difference between a bank guarantee and a bond?

    A bank guarantee is a promise from a bank or lending institution that, if a borrower defaults on repayment of a loan, the ... Read Full Answer >>
Related Articles
  1. Mutual Funds & ETFs

    Exchange Traded Notes: An Alternative To ETFs

    ETNs offer yet another way to track an index. Find out what they have to offer, and what's at stake.
  2. Personal Finance

    Promissory Notes: Not Your Average IOU

    These may be a handy way to borrow money, but this convenience does not come without risk.
  3. Bonds & Fixed Income

    Retail Notes: A Simpler Alternative To Bond Funds

    These securities are meant to be held until maturity, removing the burden of complex pricing that sometimes plagues bonds.
  4. Options & Futures

    Principal-Protected Notes: Hedge Funds For Everyday Investors

    PPNs guarantee to return at least 100% of the original investment and have the potential to return much more.
  5. Forex Education

    The History Of Money: From Barter To Banknotes

    Money has been a part of human history for at least 3,000 years. Learn how it evolved.
  6. Retirement

    Bond Basics Tutorial

    Investing in bonds - What are they, and do they belong in your portfolio?
  7. Investing Basics

    What's a Debt Security?

    A debt security is a financial instrument issued by a company (usually a publicly traded corporation) and sold to an investor.
  8. Mutual Funds & ETFs

    Why You May Want To Be (And Stay) In Bonds

    Bonds are complicated, and it’s easy to feel intimidated or confused. Fortunately, you don’t need to be a numbers geek to be an informed investor.
  9. Mutual Funds & ETFs

    How To Short The U.S. Bond Market

    The U.S. bond market has enjoyed a strong bull run over the past few years as the Federal Reserve has lowered interest rates to historic low levels.
  10. Mutual Funds & ETFs

    The EMAG Emerging Mkts Bond ETF: Worth the Risk?

    The Market Vectors Emerging Markets Aggregate Bond ETF (EMAG) might offer long-term rewards, but is now the best time to jump in?

You May Also Like

Hot Definitions
  1. Radner Equilibrium

    A theory suggesting that if economic decision makers have unlimited computational capacity for choice among strategies, then ...
  2. Inbound Cash Flow

    Any currency that a company or individual receives through conducting a transaction with another party. Inbound cash flow ...
  3. Social Security

    A United States federal program of social insurance and benefits developed in 1935. The Social Security program's benefits ...
  4. American Dream

    The belief that anyone, regardless of where they were born or what class they were born into, can attain their own version ...
  5. Multicurrency Note Facility

    A credit facility that finances short- to medium-term Euro notes. Multicurrency note facilities are denominated in many currencies. ...
  6. National Currency

    The currency or legal tender issued by a nation's central bank or monetary authority. The national currency of a nation is ...
Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!