Introduction
Medium Term Notes (MTNs) are debt securities with maturities between 5 and 10 years, issued by banking institutions or government entities. They are a key asset in structured finance. But what makes them so special?
What is an MTN?
An MTN is a flexible bond, often issued “on demand” from the market, which can be customized in terms of currency, duration, interest rate, and payment structure.
Why invest in MTNs?
- Competitive yield.
- Flexibility in maturities.
- Customizable risk profile.
Who issues MTNs?
- Multinational banks.
- Governments.
- Financial institutions.
How are they traded?
- On the primary market, at the time of issuance.
- On the secondary market, through brokers or dedicated programs.
Use in Structured Finance
- Collateralization.
- Participation in PPPs.
- Regulated arbitrage operations.
Risks to Consider
- Variable liquidity.
- Issuer credit risk.
- Possible fraud in the secondary market.
Conclusion and CTA
MTNs represent a great opportunity to diversify your portfolio and access high-yield operations. Contact us for a free assessment of your profile and receive verified proposals.