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6

Profit is sales price - cost - expenses. So yes, if you bought something for $1000 and sold it for $1,100 your profit is $100, assuming no transaction fees. It is irrelevant if you are buying and selling bonds, trading cards, or broomsticks.


4

Because the price will change to so that the yield is "fair" (according to market expectations) and people want to use their money for other things now rather than waiting for the next auction. On the day of a 2 year note auction, for example, if you hold a 5 year note that was issued 3 years ago (so it has 2 remaining years), the value of your 5 ...


4

Bonds are not traded on an exchange like stocks, and so there are no "designated" market makers like for stocks, but there are some brokers that will buy and re-sell bonds to keep liquidity up (and to make a bit of profit for themselves). So I wouldn't expect your bond trade to be executed in "seconds" but if there are buy and sell quotes ...


2

price of the bond ETFs (like BND) would stay relatively constant (rising or falling temporarily depending on the interest rate changes), which is not the case. Why do you say the changes would be temporary? If I hold a 5% bond and rates drop, the value of that bond increases and stays high until rates rise back again. So yes, interest rates are the main ...


2

You have to dig into the story to get the details. The headline or the opening sentences will generally not tell you. I found this headline from [October 15th 2021]: Treasury yields gain after retail sales increase in September It stories 2nd paragraph said The yield on the benchmark 10-year Treasury note climbed by 5.3 basis points to 1.572% at 4:10 p.m. ...


2

If treasuries are at 2% then 2% is the risk-free rate of return. If you are a risk-adverse investor or if you want to allocate some percentage of your portfolio to low-risk assets either permanently or temporarily while you look for a better place to invest it, you'd want to hold some quantity of risk-free assets like treasury bonds. If you're a 30 year old ...


1

Yes in that case you would have about a -1% yield. While it may seem counterintuitive, it's actually quite common in some countries that are discouraging saving (by incentivizing people to spend or invest their money rather than save it) to prevent deflation.


1

Do they refer to the most recently auctioned note only? Yes - the most recently issued bonds are called "on-the-run" and are typically used to quote current yields. Bonds issued before the most recent auction are called "off-the-run" and are still traded but are not as liquid as on-the-run. and so this will affect the price of the ...


1

So, my question is, what causes price of bond ETFs to rise over long period of time? In another words, why are they a good investment, excluding the dividends (or is it just because of consistent stable dividends)? The rising prices due to falling interest rates have already been covered. Another reason for rising ETF prices can be that the ETF is not ...


1

The price of BND, for example, increased from about $75 to $85 over the past 15 years, reflecting both a decrease in interest rates along the entire yield curve and a perceived decrease in credit risk among various bond classes (corporate, junk, government). Absent a change in overall rates or a change in perceived risk, the price of BND should be relatively ...


1

NMS is referring to the National Market System - a standard market for equities trading in the U.S. For most people, this is the equity you'd want to trade in if you wanted to "own shares" of Tesla. LSEETF is likely referring to a London Stock Exchange ETF. In your screenshot, you've returned results specifically from LeverageShares, a specialized ...


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