Discount notes are unsecured general corporate obligations that are issued at a discount and mature at par. Freddie Mac issues most short-term debt as discount notes.
- Maturities range from overnight through one year
- May be acquired in denominations as small as $1,000; additional amounts may be acquired in increments of $1,000
- Are issued and maintained in book entry form through the Federal Reserve Bank of New York
- Give institutional and retail investors choices in the investment date, maturity date and size of their short-term investments
- Offer tailored, flexible investment opportunities for money managers seeking to invest discrete U.S. dollar amounts for precise, short time periods.
Freddie Mac and the U.S. Dollar Discount Note Market
Our discount note issuance establishes us as one of the largest non-government providers of short-term debt in the world. The amounts and variety of discount notes sold in recent years testify to our ability to match investors’ short-term investment needs and maturity preferences with our overall funding requirements.
Pricing conventions for discount notes are the same as those used for T-bills, and Freddie Mac’s discount notes offer superior primary market availability. Our discount notes are offered continually to investors, with 24-hour postings available through Freddie Mac's dealer selling group. Active secondary market trading provides additional liquidity for these investments. The size of the program, coupled with the diversity of the investor base and strong dealer commitments, provide superior secondary market liquidity for Freddie Mac’s discount notes.
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