Note Against Bond Spread - NOB

DEFINITION of 'Note Against Bond Spread - NOB'

A spread within futures contracts created by offsetting positions in 30-year treasury bond futures with positions in 10-year treasury note contracts.

BREAKING DOWN 'Note Against Bond Spread - NOB'

Also known as the note over bond spread, the position a futures trader will take depends upon their perception of the yield curve. If a flat yield curve is expected, the investor will take a long position in the bond and a short in the note contract. If the yield curve is steep, the investor will short the bond and take a long position in the note contract.

RELATED TERMS
  1. Five Against Bond Spread - FAB

    A spread in the futures markets created by taking offsetting ...
  2. Treasury Note

    A marketable U.S. government debt security with a fixed interest ...
  3. Yield Curve

    A line that plots the interest rates, at a set point in time, ...
  4. Treasury Yield

    The return on investment, expressed as a percentage, on the debt ...
  5. Thirty-Year Treasury

    A U.S. Treasury debt obligation that has a maturity of 30 years. ...
  6. Curve Steepener Trade

    A strategy that uses derivatives to benefit from escalating yield ...
Related Articles
  1. Investing

    Trade Bond ETFs Using Yield Curves

    Different types of yield curves provide important insights for trading bond-based securities.
  2. Markets

    Understanding The Treasury Yield Curve Rates

    Treasury yield curves are a leading indicator for the future state of the economy and interest rates.
  3. Markets

    The Importance Of U.S. Treasury Rates

    U.S. Treasury bond interest rates affect more than just bondholders! It impacts the day to day lives of all consumers.
  4. Managing Wealth

    Corporate Bonds: An Introduction To Credit Risk

    Corporate bonds offer higher yields, but it's important to evaluate the extra risk involved before you buy.
  5. Markets

    Understanding Interest Rates, Inflation And Bonds

    Get to know the relationships that determine a bond's price and its payout.
  6. Trading

    Explaining Credit Spread

    A credit spread has two different meanings, one referring to bonds, the other to options.
  7. Retirement

    How to Pick the Right Bonds For Your IRA

    Learn about the best types of bonds to include in an IRA depending on an investor's risk tolerance. Understand the tax benefits of holding bonds in an IRA.
  8. Trading

    Futures Fundamentals: Strategies

    Essentially, futures contracts try to predict what the value of an index or commodity will be at some date in the future. Speculators in the futures market can use different strategies to take ...
  9. ETFs & Mutual Funds

    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.
  10. Managing Wealth

    20 Investments: Futures Contract

    What Is It? As the name implies, futures are contracts on commodities, currencies, and stock market indexes that attempt to predict the value of these securities at some date in the future. ...
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. Where on the Internet can I find yield curves over various periods?

    Find out where to locate reliable yield curve information on the Internet, including the U.S. Department of the Treasury ... Read Answer >>
  4. What are the different formations of yield curves?

    Find out more about the yield curve and yield curve formations, what yield curves measure and the three main types of yield ... Read Answer >>
  5. What is the current yield curve and why is it important?

    Understand what the current yield curve represents, and learn how market analysts commonly interpret various changes in the ... Read Answer >>
  6. 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 >>
Hot Definitions
  1. Brazil, Russia, India And China - BRIC

    An acronym for the economies of Brazil, Russia, India and China combined. It has been speculated that by 2050 these four ...
  2. Brexit

    The Brexit, an abbreviation of "British exit" that mirrors the term Grexit, refers to the possibility of Britain's withdrawal ...
  3. Underweight

    1. A situation where a portfolio does not hold a sufficient amount of a particular security when compared to the security's ...
  4. Russell 3000 Index

    A market capitalization weighted equity index maintained by the Russell Investment Group that seeks to be a benchmark of ...
  5. Enterprise Value (EV)

    A measure of a company's value, often used as an alternative to straightforward market capitalization. Enterprise value is ...
  6. Security

    A financial instrument that represents an ownership position in a publicly-traded corporation (stock), a creditor relationship ...
Trading Center