Certified Government Financial Manager (CGFM) Practice Exam 2025 – Your All-in-One Guide to Exam Success!

Short-term fixed income securities are designed to have maturities of one year or less, and they are considered a low-risk investment option. The option that states these securities include Treasury bills highlights a key characteristic. Treasury bills are short-term government debt instruments that are issued by the U.S. Department of the Treasury, and they are indeed backed by the full faith and credit of the U.S. government, which adds an additional layer of security and stability for investors. This feature makes them an attractive choice for those seeking safe, liquid investments.

On the other hand, other options present characteristics that do not align with the nature of short-term fixed income securities. For instance, securities with maturities longer than 10 years and those that are generally more volatile than equities do not describe short-term investments, as they relate more to long-term fixed income securities and stocks, respectively. Additionally, stating that these securities only include government bonds is too restrictive since short-term fixed income instruments can also encompass corporate bonds and other forms of securities, not just those issued by the government.