Treasury bills identified as superior risk-free rate proxies for investors.
The study looked at different types of Treasury securities to see which one is the best measure of the risk-free rate in finance. They found that Treasury bills are the most reliable choice, as they have the lowest market and inflation risks over different time periods. Treasury bills are better than longer-term Treasury bonds at predicting returns, especially over longer investment horizons. Treasury bills are a good proxy for the risk-free rate, making them a useful tool for investors and financial analysts.