US Treasury Securities and Conflicts between Bondholders and Stockholders in a Corporation

Managerial Finance
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Managerial Finance
United States treasury securities are risk-free. The following is a justification for this position. It is important to clarify that such securities will be risk-free to those individuals who ensure that they hold their securities until they mature. Evidence has shown that there may be a risk for anyone who decides to sell their securities before they mature (Tokunaga, 2019). The first reason why I hold the above position is that the United States government securities are guaranteed to any investor who holds the securities until their maturity date. The risk involved with selling before maturity is that the investor may incur a loss. Secondly, the history of treasury securities has proved that they are risk-free. Investors are sure that they will not lose their principal no matter the factors that may affect the economy. The third r...