Why do Investors Care?
Individual investors can also participate in Treasury auctions either through a securities dealer (brokerage firm) or via the Treasury Direct program. The Treasury Direct program saves on brokerage commissions, but a brokers' commission is fairly nominal (especially with discount brokers) and eliminates a lot of paper work and other administrative hassles. Brokers facilitate the purchases and sales of Treasuries in the secondary market, which is handy for buying Treasuries at times other than scheduled auctions or with maturities other than those offered by standard new issues.

Primer on Treasuries
Treasury securities, Treasuries, U.S. government bonds, T-bonds, T-notes, T-bills, and Govies all refer to the same type of security, and are debt obligations of the United States. Maturity refers to the length of the loan to the government. Treasury bills have maturities typically from four weeks to one year (4-week, 3-month, and 6-month bills). The Treasury no longer issues new one-year bills (also known as 52-week bills) but these are available in the secondary market. Since August 1998, the Treasury ruled that all securities it issues now have minimum denominations of $1,000.

How bills work
Since they mature so quickly, bills are simply sold at a discount to their face value at maturity. The discount is determined by the interest rate. If it's a six-month bill with a 5% discount rate, the investor pays 95% of the face value or $950, then receives $1,000 back in six months.

Investment Profile
Treasuries offer a measure of security unmatched by other investments - the U.S. government guarantees your initial investment (the principal) and the interest payments. If Treasuries are resold in the secondary market, their price could be substantially more or less than the face value. This price in the secondary market fluctuates based on expected inflation, the Fed's interest rate policy, and simple supply and demand forces for Treasuries.