# Bond Quote

## What is a 'Bond Quote'

A bond quote is the last price at which a bond traded, expressed as a percentage of par value and converted to a point scale. Par value is generally set at 100, representing 100% of a bond's face value of \$1,000. For example, a corporate bond quoted at 99 is trading at 99% of face value, meaning the cost of buying each bond is \$990.

## BREAKING DOWN 'Bond Quote'

Price quotes for bonds are represented by a percentage of the bond's par value, which is converted to a numeric value and multiplied by 10 to determine the cost per bond. Bond quotes can also be expressed as fractions, with corporate bonds quoted in 1/8th increments, and government bills, notes and bonds quoted in increments of 1/32nd. For example, a bond quote of 99 1/4 represents 99.25% of par. Converting the percentage to 99.25 and multiplying by 10 results in a cost of \$992.5 per bond. In addition to being quoted as a percentage of par value, bonds may also be quoted with a yield to maturity (YTM).

## Full Bond Quotes

In addition to the last price at which a trade occurred, full bond quotes include bid and ask prices, which are calculated in the same manner as the quote on the last trade. The bid is the highest price level buyers are willing to pay for the bond at the time of the quote. For bond sellers seeking immediate trade executions, the bid is the likely price for the trade. The ask is the lowest price level on bonds to be sold at the time of the quote.

The difference between the bid and the ask price is referred to as the spread. In a full quote, bonds with high levels of liquidity, such as Treasuries, generally have spreads of a few pennies between the bid and the ask price. The spreads on corporate bonds with lower levels of liquidity, on the other hand, can exceed \$1. For example, a full quote on an illiquid corporate bond could list a last trade of \$98, with a bid of \$97 and an ask price of \$99.

## Quotes Based on Yield

Bonds can also be quoted in terms of their yield to maturity (YTM), which is commonly done for reference purposes rather than trading. For example, the financial media often quotes the 10-year Treasury note by its YTM, to give listeners and viewers a reference point for fluctuations in bond prices. For example, a YTM-based quote on the 10-year Treasury note could be presented as 1.92%, down from the previous close of 1.94%, an indication of an increase in bond prices for the day.