What Is a Treasury Bond Yield?
The yield of treasury bonds refers to the ratio of the income from investing in treasury bonds as a percentage of the total investment amount each year. The one-year rate is the annual rate of return. Bond yields are usually expressed in annual yields of "%".
Treasury yield
- Yield indicator
- When the value or price of the national debt is known,
- The yield curve for national debt analysis, just like the K-line chart for stock analysis, seems simple and intuitive, but it contains infinite mysteries. With the continuous development of international financial innovation since the 1970s, the importance of the yield curve has far exceeded the field of national debt analysis, and has become one of the cornerstones of the entire financial analysis.
- So what is the yield curve? Let's first review the concept of yield. To judge whether an investment is worthwhile, people have come up with many ways. One of the most common methods is to calculate the rate of return, that is, the return on investment as a percentage of the total investment in a certain period of time.
- In real life, the most common example of people's rate of return is the savings rate. Take the RMB deposit deposit and withdrawal rate as of August 19, 2006 as an example:
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- It can be seen that the 1-year savings yield is 2.52% and the 2-year savings yield is 3.06%. The rate of return on savings (that is, the interest rate on savings) has a clear correlation with maturity. The longer the period, the higher the interest rate. Therefore, if the issue of capital occupation is not considered, a longer-term savings product should be selected to obtain higher returns.
- In order to show the relationship between the yield rate and the maturity period, the maturity period can be used as the abscissa, and the yield rate can be plotted on the ordinate. connect them. This is the yield curve of bank savings.
- Similarly, as a kind of investment vehicle, national debt also has a similar relationship between its yield and maturity. In general, the longer the period, the higher the yield. In order to accurately grasp this changing relationship, and thus to correctly select investment varieties in short-, medium-, and long-term government bonds, people have invented the important analysis tool of the national debt yield curve.
- The T-bond yield curve is a curve describing the relationship between the T-bond investment yield and maturity.
- For investors, the more important
- China Treasury yield ranking
- China National Debt
- Gold is money, although holders can't earn interest; national debt is paper or digital. In order to appease the anxiety of the holder, the issuer will pay the so-called "government bond income". The ratio of the total return of the national debt to the total investment amount each year is the annual "national bond yield". Today we take a look at the US 10-year Treasury yields. Under the current yield background, from a macro perspective, the trend of the precious metals will be. [2]
- (US 10-year Treasury yield weekly chart)
As can be seen from the figure above, in the past four years, several rounds of quantitative easing monetary policy have stimulated the upward trend of government bond yields. When the stimulus effect subsided, the government bond yields returned to the previous decline channel. When the yield rises, of course, the purchase of US Treasury bonds will of course have a slightly stronger return than the previous period. So how do investors choose between buying gold for value preservation and purchasing Treasury bonds to obtain Treasury bond yields? This requires looking at the ratio of the two, as shown below,
- (U.S. 10-year Treasury yield to gold ratio-weekly)
The figure above fits the ratio of the two with the international gold price. Compared with the figure above, it can be seen that during the quantitative easing period, the government bond yield gold ratio is lower, which means that the increase in the yield exceeds the gold price, even here. The price of gold also declined during the period. However, due to the consideration of the devaluation of the paper currency, gold will still be bought and held by the market, although its growth rate will lag behind other commodities, such as copper, zinc, tin and other basic metals. Then in the QEN environment with no limit and no time limit, the continued decline of the ratio means that the yield of government bonds may continue to rise. Although the increase in gold lags behind the increase in the yield of government bonds, the price of gold will continue to fluctuate and slowly rise .