Maturity Date
Quick Definition
The date on which a bond's principal (face value) is repaid to the investor and interest payments cease.
Key Takeaways
- The date when the issuer repays the bond's face value
- Short-term (1–3y), intermediate (3–10y), and long-term (10–30y) classifications
- Longer maturities generally carry higher yields and greater price sensitivity
- At maturity the bondholder receives par value regardless of purchase price
What Is Maturity Date?
The maturity date is the specific calendar date when a bond's issuer must repay the full face value (par value) to bondholders and the bond ceases to exist. It defines the time horizon of the investment and is one of the most fundamental characteristics of any fixed-income security. Bonds are generally classified by maturity: short-term (1–3 years), intermediate-term (3–10 years), and long-term (10–30+ years). Longer maturities typically carry higher yields due to greater interest rate risk and uncertainty. At maturity, assuming no default, the bondholder receives the final coupon payment plus the par value, regardless of what price they originally paid for the bond.
Maturity Date Example
- 1A 10-year Treasury note issued on January 15, 2026, has a maturity date of January 15, 2036
- 2If you buy a bond at $950 with a maturity date in 2 years, you'll receive $1,000 at maturity plus any remaining coupons
Related Terms
Par Value
The face value of a bond, typically $1,000, representing the amount repaid to the bondholder at maturity.
Coupon Payment
The periodic interest payment made to bondholders, typically paid semiannually based on the bond's stated coupon rate and face value.
Yield to Maturity (YTM)
The total annualized return an investor earns if a bond is held until maturity, accounting for coupon payments, purchase price, and par value at redemption.
Duration
A measure of a bond's price sensitivity to interest rate changes, expressed in years, indicating how much the price will move for a 1% change in rates.
Bond
A fixed-income debt security where investors loan money to an issuer in exchange for regular interest payments and return of principal at maturity.
Treasury Bond (T-Bond)
A long-term U.S. government debt security with a maturity of 20 or 30 years, paying semiannual coupon interest.
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