Agency securities

Definition: A broad term for the various bonds and other investments that a Federal agency offers to investors.

Example: These securities are issued regularly by the various agencies. Click here to view the different offerings of Ginnie Mae, the one agency with an explicit guarantee by the U.S. Government.

Investeach explains: These securities are like ordinary bonds, with a face value, a stated interest rate, and a maturity date. They are interesting to bond investors because they pay more than Treasury bonds, which are offered and guaranteed directly by the U.S. Government. The implicit guarantee of agency securities is enough assurance for many investors to believe the U.S. Government will stand behind them if the issuing agency is unable to make the interest and face value payments.

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