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Fixed Income

Madison U.S. Treasury Bond Ladders

Strategy Overview

Madison’s Treasury Bond Ladders are designed to pursue stable income streams while seeking capital preservation and reducing interest rate risk by reinvesting proceeds at the longest end of the maturity distribution for the ladder. The strategy invests in U.S. Treasuries. We offer three laddered maturity structures: 1-3 years, 1-5 years, and 1-10 years.

Key Facts

Strategy Inception August 2022
Investment Vehicles Separate Account
Investable Securities U.S. Treasury Bonds
Maturity Structures 1-3 year
1-5 year
1-10 year
Fact Sheet

Experienced Management

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Investment Process

Madison’s Treasury Bond Ladders are constructed by purchasing a series of U.S. Treasury issues with staggered maturities across the desired maturity range of the portfolio. As bonds mature, the proceeds are used to purchase securities at the longer end of the maturity structure. This process allows the client to potentially capture higher yields.

Our highly experienced team combines top-down macroeconomic outlook, sector valuation, and in-depth credit analysis to build our ladder portfolios. We only purchase U.S. Treasuries, which are among the highest-quality investment-grade bonds.

A visual chart shows a five-year investment ladder with rows labeled 1 to 5 years, and arrows indicating reinvestment after each year as bonds mature, repeating the cycle.

Defining Characteristics

Steady income generation

Maturities are evenly spaced throughout the applicable maturity range, allowing for a steady stream of income and reinvestment flow.

High-quality

Invests in U.S. Treasuries, which are among the highest-quality investment-grade bonds.

Liquidity

Holds transparent, traditional bonds with a high degree of liquidity and no exposure to derivatives.

Madison Fixed Income Team

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In addition to the ongoing market risk applicable to portfolio securities, bonds are subject to interest rate risk, credit risk and inflation risk. When interest rates rise, bond prices fall; generally, the longer a bond’s maturity, the more sensitive it is to this risk. Credit risk is the possibility that the issuer of a security will be unable to make interest payments and repay the principal on its debt. Bonds may also be subject to call risk, which allows the issuer to retain the right to redeem the debt, fully or partially, before the scheduled maturity date. Proceeds from sales prior to maturity may be more or less than originally invested due to changes in market conditions or changes in the credit quality of the issuer.