Treasury bills are amongst the safest investment options in the US as well as Canada. It is widely regarded as so, by investors in both the countries as well as the best global credit credit rating institutions such as Moodys and Standard and Poor. The T-Bills, in both the countries are fully backed by the Federal Governments, who cover each and every aspect of the deals. The interest rates provided are supposed to be risk-free.
It is known that the bills are different from normal bonds. The difference lies in the fact that they do not pay any interest in the US, and in Canada they do yield a lucrative interest, but for that benefit to reach the investor the bill has to be kept for the entire term.
In the US these are sold at a price lesser than their actual value. This is a crucial point as the difference
constitutes the amount received by the buyer at the end of maturity.
There is a ready formula to calculate the discounts in the US market. The maturity period of the concerned bill is divided by a product of the three hundred and sixty days of a year and the discount basis.
In Canada the Treasury Bill is supposed to guarantee high returns, under most circumstances. It is an option devoid of risk, and even more so if the holder manages to keep the investment for the entire term. However though, even short term investments guarantee sharp returns. Thus in Canada it is always a win-win situation as, apart from the actual benefits, the bills could be sold at any point of time, as they are extremely fluid assets.
It is a different situation in the US though, as the benefits over there are of a different kind altogether. In the United States the owner of a bill stands to gain from the difference of the cost price and the sale price. The discount makes all the difference. This could not be said of Canada as the bills over there are usually sold at face value.