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Maturity

The date the issuer repays a bond's face value and the security ceases to exist; also shorthand for how long is left until that date.

Maturity is the single biggest driver of how much a bond moves. Longer maturities mean more distant cash flows, which means higher duration and bigger price swings for the same change in yield.

Traders slice the market by maturity: bills out to one year, notes from two to ten years, bonds beyond that. A quote like the 2-year or the 30-year always means the most recently auctioned, or on-the-run, issue at that maturity.

Example: yields rise 0.25% across the board. A 2-year note with duration near 1.9 falls roughly 0.48%. A 30-year bond with duration near 17 falls roughly 4.25%. Same move in rates, nine times the damage.

Related: bond, duration

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