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

Treasury securities represent the highest reliability concerning the return of principal due to their backing by the full faith and credit of the United States government. When investors purchase Treasury securities, they are essentially lending money to the federal government, which has a long-standing reputation for repaying its debts. This means that, barring any extraordinary circumstances, investors can expect to receive their principal amount back upon maturity, making these securities a very low-risk investment option.

In contrast, other investment types like stocks, corporate bonds, and real estate properties carry a higher level of risk related to the potential loss of principal. Stocks may fluctuate significantly in value, and there's no guarantee of return. Corporate bonds, while more stable than stocks, can be subject to the creditworthiness of the issuing corporation, which can lead to default and loss of principal. Real estate properties also have their risks, including fluctuating market values and potential maintenance costs that can affect overall returns. Thus, Treasury securities are recognized for their reliability as a principal investment, marking them as the safest choice among the given options.