Five Against Note Spread - FAN

DEFINITION of 'Five Against Note Spread - FAN'

A spread in the futures markets created by taking offsetting positions in futures contracts for five-year treasury notes and ten-year treasury bonds.

BREAKING DOWN 'Five Against Note Spread - FAN'

A FAN spread is created by either buying a futures contract for five-year treasury notes and selling a futures contract for ten-year treasury bonds or vice versa. Investors speculating on interest rate fluctuations will enter into this type of spread in hopes of under or overpriced treasuries.

RELATED TERMS
  1. Five Against Bond Spread - FAB

    A spread in the futures markets created by taking offsetting ...
  2. Note Against Bond Spread - NOB

    A spread within futures contracts created by offsetting positions ...
  3. Treasury Yield

    The return on investment, expressed as a percentage, on the debt ...
  4. 30-Year Treasury

    A U.S. Treasury debt obligation that has a maturity of 30 years. ...
  5. Treasury Direct

    The online market where investors can purchase federal government ...
  6. Wild Card Option

    An option associated with treasury bond or treasury note futures ...
Related Articles
  1. Bonds & Fixed Income

    What's a 10-Year Treasury Note?

    A 10-year Treasury note is an intermediate debt obligation issued by the United States government, and with a ten-year maturity date.
  2. Term

    Understanding Yield Spread

    Yield spread is the difference in yields between debt instruments.
  3. Term

    Understanding Treasury Yield

    Treasury yield refers to the return on an investment in a U.S. government debt obligation, such as a bill, note or bond.
  4. Investing Basics

    What is Treasury Stock?

    Treasury stock is a company’s own stock that it holds in its treasury for later use.
  5. Active Trading

    Buy Treasuries Directly From The Fed

    If you want government securities, go straight to the source. We'll show you how.
  6. Bonds & Fixed Income

    Introduction to Treasury Securities

    Purchasing bonds that are backed by the full faith and credit of the U.S. government can provide steady guaranteed income and peace of mind. Knowing the characteristics of each type of treasury ...
  7. Options & Futures

    Trading Calendar Spreads In Grain Markets

    Futures investors flock to spreads because they hold true to fundamental market factors.
  8. Mutual Funds & ETFs

    Top 4 Treasurys ETFs (SHY, IEI)

    Learn about the specifics of the top four U.S. Treasury ETFs and how investors can buy ETFs that invest in bonds along the yield curve.
  9. Bonds & Fixed Income

    How Bond Market Pricing Works

    Learn the basic rules that govern how bond prices are determined.
  10. Bonds & Fixed Income

    Find The Right Bond At The Right Time

    Find out which bonds you should be investing in and when you should be buying them.
RELATED FAQS
  1. Will speculators buy or sell Treasury bond futures contracts if they expect interest ...

  2. Why are treasury bond yields important to investors of other securities?

    Learn about the wide-ranging impact of U.S. Treasury Bond yields on all other interest-bearing instruments in the economy ... Read Answer >>
  3. Which economic factors impact treasury yields?

    Discover the economic factors that impact Treasury yields. Treasury yields are the benchmark yield for the rest of the world, ... Read Answer >>
  4. What is the difference between the Daily Treasury Long-Term Rates and the Daily Treasury ...

    Find out more about the daily Treasury long-term rates, daily Treasury yield curve rates and the difference between these ... Read Answer >>
  5. What are the maturity terms for Treasury bonds?

    Learn how treasury bonds pay interest, when they reach maturity and the differences between terms for treasury bonds and ... Read Answer >>
  6. The interest rate used to define the “risk-free” rate of return is the:

    a. discount rate.b. 90-day Treasury bill rate.c. five-year Treasury note rate.d. federal funds rate. Answers: bThe 90-day ... Read Answer >>
Hot Definitions
  1. Physical Capital

    Physical capital is one of the three main factors of production in economic theory. It consists of manmade goods that assist ...
  2. Reverse Mortgage

    A type of mortgage in which a homeowner can borrow money against the value of his or her home. No repayment of the mortgage ...
  3. Labor Market

    The labor market refers to the supply and demand for labor, in which employees provide the supply and employers the demand. ...
  4. Demand Curve

    The demand curve is a graphical representation of the relationship between the price of a good or service and the quantity ...
  5. Goldilocks Economy

    An economy that is not so hot that it causes inflation, and not so cold that it causes a recession. This term is used to ...
  6. White Squire

    Very similar to a "white knight", but instead of purchasing a majority interest, the squire purchases a lesser interest in ...
Trading Center