David Kotok, chairman and chief investment officer of Cumberland Advisors, said he's "had great results" owning bonds for capital appreciation in client portfolios for the past eight years, but with yields as low as they are now he says, "One has to be very careful about capital appreciation of bonds going forward." He prefers floating-rate Treasury notes
that reset rates weekly.
Due to the US Treasury Department's suspension of 30-year bond issuance between 2001 and 2006, the gap in the exposures of the existing 10-Year US Treasury note
and the US Treasury bond futures has expanded from approximately eight years to about 14 years, creating customer demand for a new product that establishes 10-year yield exposure.
10-year Treasury note
is far higher than that of Germany's (at 0.66 percent) or Japan's (at 0.35 percent).
at the end of 2002 and in a 5-year U.S.
For example, suppose a company's shares are trading at $50 at the option grant date, the yield on the 10-year Treasury note
is 4 percent, and the equity risk premium is estimated to be 5 percent.
A good benchmark for the 30-year fixed-rate mortgage is the 10-year Treasury note
, because 30-year mortgages usually get paid off in 10 years.
NORDIC BUSINESS REPORT-19 June 2006-New treasury notes
issued in Iceland(C)1994-2006 M2 COMMUNICATIONS LTD http://www.m2.com
The yield on the benchmark ten-year Treasury note
fell below that of the two-year note yesterday for the first time since December 2000, in an inversion of the yield curve.
To understand their reasoning, consider a 10-year Treasury note
with a nominal yield of 6 percent.
In Southwest Texas Electric Cooperative, Inc., TC Memo 1994-363, an electric cooperative was subject to unrelated business income tax (UBIT) on interest earned on Treasury note