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I know almost nothing about bonds. However what I do know is that bonds and stocks usually work together and opposite - so when the big boys are buying bonds, they are selling stocks, and vice versa. Money flows from one into the other.
The only other thing I know is that out of bonds, stocks and gold, there is always one which is in a rallying stage. That's why the clever peeps switch their money between these three to consistently make even more dosh.
The only other thing I know is that out of bonds, stocks and gold, there is always one which is in a rallying stage. That's why the clever peeps switch their money between these three to consistently make even more dosh.
cassiopeia
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rustic
This is nothing to do with the markets, it is how the mechanism of fixed bonds work. Most treasury bonds have a fixed regular payment (dividend) in terms of dollars, so if their price goes up, the yield as a % of that price will come down proportionately by the same amount.
%yield= 100 x total dividends over year/price of bond.
The name of the bond usually indicates what the original yield was when issued, you will notice these are quite high. eg. Treasury 9% in relation to present day interest rates.
Similarily for shares (although their dividends can vary) that is why many UK share yields are quite high, relative to a few years ago, it isn't because they have been increased in absolute terms the underlying share price has gone down and the dividend in £s hasn't been changed by as much.
This is nothing to do with the markets, it is how the mechanism of fixed bonds work. Most treasury bonds have a fixed regular payment (dividend) in terms of dollars, so if their price goes up, the yield as a % of that price will come down proportionately by the same amount.
%yield= 100 x total dividends over year/price of bond.
The name of the bond usually indicates what the original yield was when issued, you will notice these are quite high. eg. Treasury 9% in relation to present day interest rates.
Similarily for shares (although their dividends can vary) that is why many UK share yields are quite high, relative to a few years ago, it isn't because they have been increased in absolute terms the underlying share price has gone down and the dividend in £s hasn't been changed by as much.
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