> For the complete documentation index, see [llms.txt](https://docs.huma.finance/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.huma.finance/products/huma-institutional/tranches.md).

# Tranches

Tranche support is vital for institutions participating in the Huma protocol. As mentioned before, there are two types of tranches: senior and junior. The senior tranche is generally seen as a lower-risk investment. It offers a modest yield but carries less risk. If there's a default, senior tranche lenders receive payment first. The junior tranche, on the other hand, assumes a higher risk and earns a higher yield when things go smoothly. If there's a default, junior tranche lenders are paid after those in the senior tranche.