Bonds and Yields
The bond interplay has two sides, the bond price and the bond yield. Both have an inverse relationship. As bond prices rise, yields decrease and vice versa. This scenario factors for all government bonds. The choice of which side is the best investment angle depends not only on the day's LIBOR but the trend in LIBOR in terms of the three-month target.
A yield investment is a risk trade while the bond purchase is the safe trade due to backing by government revenues. What drives either side of the bond/yield interplay is interest rates, and what drives interest rates is economic conditions short and long term. In market terms, it is bond cash flows that determine a currency-pair price in nations whose bonds are tied to economic ...
Become an O’Reilly member and get unlimited access to this title plus top books and audiobooks from O’Reilly and nearly 200 top publishers, thousands of courses curated by job role, 150+ live events each month,
and much more.
Read now
Unlock full access