Treasury Index

DEFINITION of 'Treasury Index'

An index based on the auctions of U.S. Treasury bills, or on the U.S. Treasury's daily yield curve. It is commonly used in determining mortgage rates for mortgages with an unfixed component and as a performance benchmark for investors in the capital markets as it represents a rate of return that investors would be able to get from almost any bank, with minimal effort. Treasury indexes are proprietary. The calculations of treasury indexes and their components vary by the financial institution calculating the index.

BREAKING DOWN 'Treasury Index'

Components of a treasury index are likely to be the weighted average prices of five-year, ten-year and bond-futures contracts. Because the components have different investment time frames, each weighting, based on investment duration, is adjusted for equal contribution to the index.

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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. 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 >>
  4. What are the maturity terms for Treasury bonds?

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  5. 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 >>
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    Read about how the Internal Revenue Service collects taxes on treasury bills purchased from the United States government ... Read Answer >>
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