Questions tagged [government-bonds]

for questions that relate to government bonds. It is recommend you use a country tag or state what country you are referring to. A government bond is a bond issued by a national government, generally promising to pay a certain amount on a certain date, as well as periodic interest payments.

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Why is there a sell off of US bonds if interest rates in the US are currently rising?

My understanding is that as interest rates go up, the yield offered by bonds also increases (in response). If the yield of bond increases, then why are people selling bonds?
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1 answer
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Market risk for TIPs vs. I Bonds

Treasury Direct has a good comparison between TIPs and I Bonds: https://www.treasurydirect.gov/indiv/products/prod_tipsvsibonds.htm However, I want to make sure I understand when you can lose ...
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17 votes
4 answers
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How Is There A Yield Curve For Treasuries?

Why would anyone buy a 1 yr T-Bill with a return of 1.25% when you get double that on a 30-year T-Bond? Where is the risk and/or liquidity premium coming from? There's a highly liquid, secondary ...
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How is price of 1 year Treasury Bills calculated on this chart?

The chart shows USD 0.85. I assume it is per USD 1000 face value T-Bill. What does this USD 0.85 mean?
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3 votes
1 answer
130 views

Why is the price of 10-year note different for the same yield?

Looking at the price of 10-year note (ZN) futures, I noticed that the price of ZN futures corresponding to ~1.70% yield was ~128 today but was ~131 in March 2021. Why is there such a huge difference ...
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Why are there so many money market yield measurements? (MMY, BEY, BDY) Are all of them really used?

I have heard teachers online explain that since these measures do not account for compounding they are "naive" and are "rough estimates" since they have such a short maturity that ...
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1 vote
0 answers
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What does it mean to say a market is governed by technicals

In an interview, Mohamed El-Erian had this to say about the current situation for global bond funds: I’m really glad I’m no longer managing fixed income bond funds because technicals rather than ...
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1 vote
0 answers
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Why do we have *daily* series of T-bill yields?

I understand that each week the US Treasury issues new T-bills at different maturities (1-month, 3-months, 1-year, etc). As far as I understand, this issuance happens every Tuesday. After the auction, ...
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2 votes
2 answers
62 views

When the 5-Year Treasury Note's yield is up 10%, Which note exactly do they refer to?

The 5-year Treasury notes, for example, are issued multiple times during the year, everyone have its cusip number, when they say this note yield is up by 10%. Do they refer to the most recently ...
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1 vote
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What does the bond issuer/company do when the bond is oversubscribed?

I'm a beginner, I see sometimes in news that a company issue bonds (1 million total issuance), but they received 3 million requests, what will they do with the two million excess ?
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2 answers
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Compute coupon of treasuries

How do you compute coupon starting from yield and price? Since yield is coupon / par, which is 2 / 100 in this case, would it just be yield * price, 0.01906 * (102 + 1 / 32) with the data below? ...
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-1 votes
1 answer
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How often does the treasury department issue bonds and at what prices?

How often does the u.s treasury department issue bonds and at what prices? Does it issue bonds throughout the year with the same annual yield regardless of current bond prices in the bond market, as ...
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1 vote
1 answer
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How can I interpret this bond chart?

I am looking into buying a bond on DeGiro. I am new to this platform and to buying bonds. From what I understand, bonds are usually issued in multiples of 1k and have a coupon rate that is paid to you ...
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0 votes
1 answer
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Are U.S government bonds completely liquid?

In the event of a market downturn like 2008, could I liquidate them whenever I wanted to at good price on a retail stock broker?
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1 vote
0 answers
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Question about the premium from selling bonds

Suppose I bought a $1000 ten-year treasury note (2031) with 4% yield. After one year, the yield decreased to 1%. If I sell it, how much premium will I get? Will I get (3% * 1000)? If the calculation ...
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1 answer
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How can I benefit as an individual investor in bonds, from increasing of bond yield?

I'm a beginner, What do I benefit as an individual investor in bonds, from bond yields increasing ? If I bought a 10 years treasury bond at the beginning of this year with a yield of 1 and then it ...
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0 votes
1 answer
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How to buy United States 10-Year Bond and what is the code?

To trade a the Amazon stock, the code is AMZN. Is there a code for United States 10-Year Bond? Investment.com shows US10YT but there is no such code in the Interactive Trader platform.
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10 votes
5 answers
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What’s the difference between inflation and inflation tax?

I get that people seem to be using the term inflation tax as a metaphor for understanding inflation, but it seems to be a bit more than that. We all know that inflation reduces the buying power of our ...
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1 vote
1 answer
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How are sovereign bond interest rates determined? [closed]

They are a lot of questions about the price of a bond or its yield. How would bonds fare if interest rates rose? Why would I not buy a bond for less than face value? Why invest in long term ...
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5 votes
1 answer
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What do single quotation marks in the price of futures mean?

What are those single quotation marks in the price, and how to read them?
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1 vote
1 answer
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Why does the price of a TIPS bond not match the inflation adjusted principal near or at maturity?

As stated by the US Treasury: With a rise in the index, or inflation, the principal increases. With a fall in the index, or deflation, the principal decreases. I'm curious why a TIPS (912828QV5) ...
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2 votes
0 answers
103 views

Why short (German) government bond futures?

Today, mainly out of curiosity, I went to a major ETF comparison website and sorted the short ETFs by market value. I was surprised when among the first few places in the list I found an ETF (LYX0FW) ...
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-3 votes
2 answers
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What are "G-secs"?

I am having a slight trouble in understanding this. I seriously do not know what it means by "G-secs". I have heard this word in the article posted below. What does it mean when someone says ...
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1 vote
0 answers
29 views

BTP Bund spread interpretation

I know that the BTP/Bund spread is the spread between the German and Italian 10 year bonds. But I am unsure how we interpret the actual number and more importantly the drivers behind the spread ...
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0 votes
1 answer
52 views

How to find information on bond buyers?

To better assess my bond investments, I want to see what institutions are buying US treasuries in the auctions over the last three months. Just want to see if there is any change in the composition of ...
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17 votes
9 answers
9k views

Is my back-of-the-envelope calculation about taking out a loan to invest into the markets flawed?

With the recent economic struggles due to the Covid-19 pandemic the stock market seems to be even more interesting for personal investments. Taking out a loan might be one of the ways to gather or ...
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0 votes
1 answer
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Why does short-selling treasuries require significant collateral?

In the vein of this question, I'm curious about getting a loan by selling treasuries. The issue, apparently, is that the proceeds of the short sale is held as collateral. As I understand it, however, ...
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2 votes
1 answer
57 views

TreasuryDirect / Treasury bond question

I inherited old paper Treasury bonds and don't know what to do with them. Questions: Before I give TreasuryDirect my SSN, is it a legitimate US bond site? Has anyone been able to mass upload the ...
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0 votes
2 answers
251 views

Are government bonds really risk-free?

When I read finance textbooks, I read things like "assume that the risk-free rate is equal to the yield on 30-year government bonds", "the government bond earns at the risk-free rate&...
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1 vote
1 answer
136 views

What are some good reasons to buy U.S. Government debt (Treasury bonds)? [closed]

Treasury bonds issued by the U.S. Government are considered virtually risk-free, because they are backed by the U.S. Government's ability to tax in order to pay them off. I understand that Treasury ...
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0 votes
1 answer
65 views

How does Bloomberg Barclays US Aggregate Bond compare to ICE US Treasury Core Bond?

I'm looking at two US aggregate bonds trying to understand why one is more popular than the other. iShares US Aggregate Bond UCITS ETF - 0.25% TER - Bloomberg Barclays iShares US Treasury Bond UCITS ...
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0 votes
1 answer
168 views

Why is data not available for US treasury bonds on Interactive Brokers website?

I wanted to buy my first bond ever today, but when trying to get the prices for "US Treasuries" in the bond scanner page on Interactive Brokers, I was greeted with the following message: Is this ...
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1 vote
1 answer
82 views

Trying to understand the behavior of the bond market during the COVID19 crisis [closed]

I'm aware of several corporate bond indices that are (slightly) going up despite of the COVID19 crisis. For instance, let's take this corporate bond index as an example. Choosing the 1Y chart one can ...
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0 votes
0 answers
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Why is my series EE bond's next accrual date not a multiple of 6 months after the issue date

My grandparents gave me a few Series EE bonds while I was growing up. I have entered their serial numbers/issue dates into this calculator on treasurydirect.gov. Most of the bonds' issue date was in ...
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11 votes
2 answers
2k views

Do bonds become more valuable right before a coupon payment?

I'm learning about fixed income for the first time and my understanding is that the value of a bond depends on three major variables: The face value The time to maturity The coupon rate a.k.a. the ...
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1 vote
2 answers
67 views

Relation of Stocks, Bond and Yield to each other in Market

I have been told by Financial advisors that I have to diversify in stocks and bonds to reduce risk of losing money in stocks. I have attached the chart of DOW and 10 Year Treasury note below. My ...
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1 vote
1 answer
102 views

What sets long term government yields?

Can one say that the market sets the rate/yield via the price that in turn is determined by supply and demand? The supply/demand is moreover a function of inflation, future expectations of short term ...
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2 votes
2 answers
238 views

What is the interest rate that the governments bonds move inversely to?

When we talk about "the interest rate" that government bonds move inversely to which is this rate?
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0 votes
1 answer
240 views

10 year treasury constant maturity rate explained

The 10-year treasury constant maturity rate over 2019 fell from a Max of 2.75 to a Min of 1.50 with an average of 2.15. I want to check whether my understanding of what the figures and the 10-year ...
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1 vote
1 answer
60 views

How customary are for European governments to sell government bonds online directly to individuals?

The State Treasury (under the helm of the Ministry of Finance (and not the Central bank as it is sometimes in the other countries)) issues the government bonds for the Republic of Latvia and in the ...
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  • 111
3 votes
1 answer
1k views

Redeeming minuteman savings stamps the old-fashioned way?

We just found in our house two books of 10¢ Minuteman stamps, face value $2.90.  I see that they are sold as collectibles for a wide range of prices. But I am curious whether there is still some ...
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1 vote
3 answers
142 views

On a statement of Dalio and the case for gold

Last night I was watching the following videos https://www.youtube.com/watch?v=YVLJRGA5uAk and https://www.youtube.com/watch?v=AhDrvQiNV5M&t I am considering the bet on gold with respect to his ...
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1 vote
1 answer
128 views

Why have treasury prices risen despite increasing interest rates since the Great Recession?

ETFs that track treasuries have risen despite the fact that the global economy has stabilized since 2008 and interest rates have risen (from near 0 to ~1.5%) My (very simplistic) understanding of ...
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1 vote
0 answers
65 views

To know if I want to hold Municipal Bonds, I want to know the percent of unfunded pension liabilities ($3.8T) to total state and local gov liabilities

I'm pondering whether or not to hold Municipal Bonds in my portfolio. My concern is that Municipalities seem to be stressed because unfunded pension liabilities keep growing and this seems alarming. ...
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2 votes
2 answers
107 views

"Holding the trade" in fixed income arbitrage

From TIPS v Treasuries: What a wild ride it was! Receiving 5% on one US Government Bond and paying 2.5% on another US Government Bond with the same maturity is an obvious winner, but many hedge ...
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1 vote
1 answer
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Are Muni REVENUE bonds secured or can the local gov. use the revenues for other purposes not paying the bond holders if its going bankrupt?

Municipal bonds are of two kinds: GO (General Obligation) Bonds or Revenue Bonds. My question on Revenue Bonds is: are the revenues from the specific project secured or can the local government use ...
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8 votes
2 answers
4k views

Are treasury bonds more liquid than USD? [closed]

Does it make sense to say that, in a way, US Treasury bonds are more liquid than USD? I think this because the value of all the bonds in circulation is way greater than all the dollars in circulation, ...
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  • 533
5 votes
5 answers
377 views

Which yield curve is inverting?

All over the news I read that the yield curve is inverting. I thought they were talking about the US Treasury Bond yield curve. This seems to be the case when I read this article. However there are ...
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2 votes
2 answers
644 views

Why would zero-coupon perpetuity not be worthless (simple enough so grandma understands)

The context is the negative yielding treasuries in Europe (Germany). Here is a quote I found on the matter: Why would a zero-coupon perpetuity not be worth exactly zero? Because its nominal value ...
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1 vote
4 answers
263 views

Locking in rates during yield curve inversion

While reading multiple articles about yield curve inversion, a common theme is that investors seeing an economic slowdown in the future which generally means lower interest rates so they want to lock ...
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