Tenor refers to the length of time until a financial contract expires or matures, such as the duration of loans, bonds, swaps, or derivative instruments. Tenor affects pricing, risk assessment, and strategy selection as longer tenors typically involve greater uncertainty and different risk-return characteristics than shorter-term instruments.

Understanding tenor helps assess interest rate sensitivity, credit risk, and liquidity characteristics of financial instruments. Different tenors serve various purposes from short-term hedging to long-term investment strategies. Tenor structure analysis reveals market expectations about future interest rates, volatility, and economic conditions.

Real-world example: A company chooses between 2-year and 5-year interest rate swaps, with the 5-year tenor offering more stability but higher rates due to increased duration risk and uncertainty about future economic conditions.