On-The-Run Treasuries

AAA

DEFINITION of 'On-The-Run Treasuries'

The most recently issued U.S. Treasury bond or note of a particular maturity. "On-the-run" Treasuries are the opposite of "off-the-run" Treasuries, which refer to Treasury securities that have been issued before the most recent issue and are still outstanding. Media mentions about Treasury yields and prices generally reference "on-the-run" Treasuries.

INVESTOPEDIA EXPLAINS 'On-The-Run Treasuries'

The on-the-run bond or note is the most frequently traded Treasury security of its maturity. Because on-the-run issues are the most liquid, they typically trade at a slight premium and therefore yield a little less than their off-the-run counterparts. Some traders successfully exploit this price differential through an arbitrage strategy that involves selling (or going short) on-the-run Treasuries and buying off-the-run Treasuries.

RELATED TERMS
  1. UST

    The abbreviation for the United States Treasury. UST is commonly ...
  2. 10-Year Treasury Note

    A debt obligation issued by the United States government that ...
  3. Off-The-Run Treasuries

    All Treasury bonds and notes issued before the most recently ...
  4. Treasury Bill - T-Bill

    A short-term debt obligation backed by the U.S. government with ...
  5. Treasury Bond - T-Bond

    A marketable, fixed-interest U.S. government debt security with ...
  6. Interpolated Yield Curve - I Curve

    A yield curve derived by using on-the-run treasuries. Because ...
Related Articles
  1. How Bond Market Pricing Works
    Bonds & Fixed Income

    How Bond Market Pricing Works

  2. Top 10 Investments For Baby Boomers
    Mutual Funds & ETFs

    Top 10 Investments For Baby Boomers

  3. Interest Rates And Your Bond Investments
    Investing Basics

    Interest Rates And Your Bond Investments

  4. Buy Treasuries Directly From The Fed
    Active Trading

    Buy Treasuries Directly From The Fed

comments powered by Disqus
Hot Definitions
  1. Ghosting

    An illegal practice whereby two or more market makers collectively attempt to influence and change the price of a stock. ...
  2. Elasticity

    A measure of a variable's sensitivity to a change in another variable. In economics, elasticity refers the degree to which ...
  3. Tangible Common Equity - TCE

    A measure of a company's capital, which is used to evaluate a financial institution's ability to deal with potential losses. ...
  4. Yield To Maturity (YTM)

    The rate of return anticipated on a bond if held until the maturity date. YTM is considered a long-term bond yield expressed ...
  5. Net Present Value Of Growth Opportunities - NPVGO

    A calculation of the net present value of all future cash flows involved with an additional acquisition, or potential acquisition. ...
  6. Gresham's Law

    A monetary principle stating that "bad money drives out good." In currency valuation, Gresham's Law states that if a new ...
Trading Center