DEFINITION of 'On-The-Run Treasury Yield Curve'

The U.S. Treasury yield curve derived using on-the-run treasuries. The on-the-run Treasury curve is the primary benchmark used in pricing-fixed income securities.

BREAKING DOWN 'On-The-Run Treasury Yield Curve'

While the on-the-run Treasury yield curve is typically used to price fixed-income securities, its shape is sometimes distorted by up to several basis points if an on-the-run Treasury goes "on special". A Treasury goes on special when its price is temporarily bid up, usually as the result of demand by securities dealers to use the security as a hedging vehicle.

RELATED TERMS
  1. Interpolated Yield Curve - I Curve

    A yield curve derived by using on-the-run treasuries. Because ...
  2. On-The-Run Treasuries

    The most recently issued U.S. Treasury bond or note of a particular ...
  3. Off-The-Run Treasury Yield Curve

    The U.S. Treasury yield curve derived using off-the-run treasuries. ...
  4. Spot Rate Treasury Curve

    A yield curve constructed using Treasury spot rates rather than ...
  5. Off-The-Run Treasuries

    All Treasury bonds and notes issued before the most recently ...
  6. Curve Steepener Trade

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

    Understanding The Treasury Yield Curve Rates

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

    Interest Rates And Your Bond Investments

    By understanding the factors that influence interest rates, you can learn to anticipate their movement and profit from it.
  3. Investing

    What is Treasury Stock?

    Treasury stock is a company’s own stock that it holds in its treasury for later use.
  4. Investing

    Will an Inverted Yield Curve Happen Again?

    Explore the causes of inverted yield curves, their frequency, their accuracy in forecasting recessions and whether this type of event can happen again.
  5. Investing

    How Bond Market Pricing Works

    Yield is the commonest measure used to determine a bond’s expected return. Yield-to-maturity and spot rates are the two primary yield measures.
  6. Investing

    Yield Curve

    Learn more about how this curve is used to predict changes in economic output and growth.
  7. Investing

    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 ...
  8. Investing

    Buy Treasuries Directly From The Fed

    If you want government securities, go straight to the source. We'll show you how.
RELATED FAQS
  1. 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 >>
  2. 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 >>
  3. How can the yield curve help me make investment decisions?

    Learn about the yield curve, and discover why this chart is an important economic indicator. How do Treasury bond yields ... Read Answer >>
  4. 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 >>
Hot Definitions
  1. Leverage Ratio

    Any ratio used to calculate the financial leverage of a company to get an idea of the company's methods of financing or to ...
  2. Two And Twenty

    A type of compensation structure that hedge fund managers typically employ in which part of compensation is performance based. ...
  3. Market Capitalization

    The total dollar market value of all of a company's outstanding shares. Market capitalization is calculated by multiplying ...
  4. Expense Ratio

    A measure of what it costs an investment company to operate a mutual fund. An expense ratio is determined through an annual ...
  5. Mezzanine Financing

    A hybrid of debt and equity financing that is typically used to finance the expansion of existing companies. Mezzanine financing ...
  6. Long Run

    A period of time in which all factors of production and costs are variable. In the long run, firms are able to adjust all ...
Trading Center