Par Yield Curve

Dictionary Says

Definition of 'Par Yield Curve'

A graph of the yields on hypothetical Treasury securities with prices at par. On the par yield curve, the coupon rate will equal the yield-to-maturity of the security, which is why the Treasury bond will trade at par.
Investopedia Says

Investopedia explains 'Par Yield Curve'

Deriving a par yield curve is a step toward creating a theoretical spot rate yield curve, which is then used to more accurately price a coupon-paying bond. A method known as bootstrapping is used to derive the arbitrage-free forward interest rates.

Sign Up For Term of the Day!

Try Our Stock Simulator!

Test your trading skills!

Related Definitions

  1. Bootstrapping

    1. A procedure ...
  2. Yield Curve

    A line that ...
  3. On-The-Run Treasury Yield Curve

    The U.S. ...
  4. On-The-Run Treasuries

    The most ...
  5. Off-The-Run Treasuries

    All Treasury ...
  6. Agency Bond

    A bond issued by ...
  7. Convertible Arbitrage

    An investing ...
  8. Liquidation

    1. When a ...
  9. Canada Savings Bond - CSB

    A financial ...
  10. Illiquid

    The state of a ...

Articles Of Interest

  1. 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.
  2. Advanced Bond Concepts

    Learn the complex concepts and calculations for trading bonds including bond pricing, yield, term structure of interest rates and duration.
  3. The Impact Of An Inverted Yield Curve

    Find out what happens when short-term interest rates exceed long-term rates.
  4. Are High-Yield Bonds Too Risky?

    Despite their reputation, the debt securities known as "junk bonds" may actually reduce risk in your portfolio.
  5. This Is Your Brain On Stocks

    Find out how the human mind can hurt investors' portfolios.
  6. Should You Invest Your Entire Portfolio In Stocks?

    It is true that stocks outperform bonds and cash in the long run, but that statistic doesn't tell the whole story.
  7. 5 Tips For Diversifying Your Portfolio

    A diversified portfolio will protect you in a tough market. Get some solid tips here!
  8. 5 Popular Portfolio Types

    Learning how to build these portfolios will increase your investing confidence and give you financial control.
  9. How To Invest When You're Deep In Debt

    Debt is one of the biggest obstacles that prevents people from investing - but it shouldn't be.
  10. Finding Your Investing Comfort Zone

    Choosing the right investments for you is the best way to feel comfortable with your portfolio.

comments powered by Disqus
Recommended
Loading, please wait...
Trading Center