As we venture farther into Yields and the Yield Curve, we will begin to get more descriptive as we come to the final interesting conclusion of our series. In order for this to make the most sense we wanted to lay the ground work carefully … such the multitalented part series – this subject can be controversial, confusing but VERY important for clues on the future economic situation.
Here in our First Part we discussed the basic yield curve itself, next up in Part Two we discussed the movement of the curve and what may or may not cause such movement.
Assets Along the Yield Curve and Placers in Each Space
Going back to our original chart … let’s take a look at a few specific points on the curve itself … Pardon the hand adjusted graph, but the original was a picture making adjustments/edits tough… but you get the picture…
Point 1, the 1 Year Time Frame – Think money market or even a One Year CD
Point 2, the 5 year time frame – Think car loan
Point 3, the 10 Year Time Frame – Municipality, commercial loans, some mortgage
Point 4, the 30 Year Time Frame- Of course our good old friend the 30 year fixed mortgage
Bond issuers may have issues all across this time frame depending on the need of the project and the timing. Some issuers such as Disney and Coke have even issued 100 year bonds … not kidding…
Our Friends at the FOMC (Federal Open Market Committee) control the overnight rate, which would be, well … at the very bottom left of our hand made graph….
Next Up, what happens when the Fed fiddles with rates! Stay tuned and hope you are enjoying.. promise an interesting conclusion.
Have a Great “Yield Curve Assets” Day!
John A. Kvale CFA, CFP
Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
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Interest Rates Part THREE of a Series – What Asset Type Sits Where on the Curve- A Definition of Players in Each Space
As we venture farther into Yields and the Yield Curve, we will begin to get more descriptive as we come to the final interesting conclusion of our series. In order for this to make the most sense we wanted to lay the ground work carefully … such the multitalented part series – this subject can be controversial, confusing but VERY important for clues on the future economic situation.
Here in our First Part we discussed the basic yield curve itself, next up in Part Two we discussed the movement of the curve and what may or may not cause such movement.
Assets Along the Yield Curve and Placers in Each Space
Going back to our original chart … let’s take a look at a few specific points on the curve itself … Pardon the hand adjusted graph, but the original was a picture making adjustments/edits tough… but you get the picture…
Point 1, the 1 Year Time Frame – Think money market or even a One Year CD
Point 2, the 5 year time frame – Think car loan
Point 3, the 10 Year Time Frame – Municipality, commercial loans, some mortgage
Point 4, the 30 Year Time Frame- Of course our good old friend the 30 year fixed mortgage
Bond issuers may have issues all across this time frame depending on the need of the project and the timing. Some issuers such as Disney and Coke have even issued 100 year bonds … not kidding…
Our Friends at the FOMC (Federal Open Market Committee) control the overnight rate, which would be, well … at the very bottom left of our hand made graph….
Next Up, what happens when the Fed fiddles with rates! Stay tuned and hope you are enjoying.. promise an interesting conclusion.
Have a Great “Yield Curve Assets” Day!
John A. Kvale CFA, CFP
Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
www.jkfinancialinc.com
www.street-cents.com
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