Treasuries Spread Bets

Bonds
  • IG Index Cuts Spreads on Treasury Products
  • Dominance of Macroeconomic News Spurs Interest in Asset Class
IG has announced a series of spread cuts on several of its interest rate products.

These products can be used to take a view on where a country’s interest rate is headed next, or to measure the market’s confidence in a government’s ability to service its own debts. As a result, Treasuries are now attracting unprecedented levels of interest from retail clients, as the global economic crisis rolls on.

Tim Hughes, IG MD, commented, “With macroeconomic news now making the headlines on a daily basis, a number of our clients are seeing Treasuries as an increasingly useful way of getting exposure to markets that historically may not have seen the same degree of volatility as currencies or indices.

“Significant themes like the future of the euro and managing the US deficit are going to linger for some time yet, so we see these spread cuts as a way to introduce even more spread betting accounts to this important asset class.”

Financial spread betting offers clients a number of benefits when trading Treasuries, including a transparent pricing structure and the ability to make profits free of tax*.

Also, because spread betting is a margin-traded product, only a percentage of the total exposure is required initially as a deposit.


Spread Bet on Treasuries

Spreads on the 2-year and 5-year Treasury Notes, as issued by the United States, have been cut from four points to two points.

The UK Short-term Gilt has been given a similar cut, while Euribor, Euroswiss, Sterling Deposit and the German Schatz have all seen their spreads cut from two points down to one.

Other interest rate products are also available from IG Index UK, including Canadian, Japanese and Italian bonds.


Spread Bet on Bonds

Below, spread betting firms that offer markets on government bonds:

Financial Spreads ETX Capital Spreadex IG City Index
BOBL Future Financial Spreads BOBL Future ETX Capital BOBL Future Spreadex BOBL Future IG BOBL Future City Index BOBL Future
Bund Future Financial Spreads Bund Future ETX Capital Bund Future Spreadex Bund Future IG Bund Future City Index Bund Future
Gilt Future Financial Spreads Gilt Future ETX Capital Gilt Future Spreadex Gilt Future IG Gilt Future City Index Gilt Future
Schatz Future Financial Spreads Schatz Future ETX Capital Schatz Future Spreadex Schatz Future IG Schatz Future City Index Schatz Future
US T-Bond 10 Year Future Financial Spreads US T-Bond 10 Year Future ETX Capital US T-Bond 10 Year Future Spreadex US T-Bond 10 Year Future IG US T-Bond 10 Year Future City Index US T-Bond 10 Year Future
US T-Bond 30 Year Future Financial Spreads US T-Bond 30 Year Future ETX Capital US T-Bond 30 Year Future Spreadex US T-Bond 30 Year Future IG US T-Bond 30 Year Future City Index US T-Bond 30 Year Future
The above spread betting markets may also be available with other companies. Also see spread betting comparison notes.


Spread Bet on Interest Rates

Below, firms that offer markets on short-term interest rates (STIRs):

Financial Spreads ETX Capital Spreadex IG City Index
Euribor Future Financial Spreads Euribor Future ETX Capital Euribor Future Spreadex Euribor Future IG Euribor Future City Index Euribor Future
Eurodollar Future Financial Spreads Eurodollar Future ETX Capital Eurodollar Future Spreadex Eurodollar Future IG Eurodollar Future City Index Eurodollar Future
Euroswiss Future Financial Spreads Euroswiss Future ETX Capital Euroswiss Future Spreadex Euroswiss Future IG Euroswiss Future City Index Euroswiss Future
Short Sterling Future Financial Spreads Short Sterling Future ETX Capital Short Sterling Future Spreadex Short Sterling Future IG Short Sterling Future City Index Short Sterling Future
The above spread betting markets may also be available with other companies. Also see spread bet comparison notes.



Spread Bet on Italian Bonds

David Jones, IG Index‘s Chief Market Strategist, commented, “Historically, yields across all the eurozone sovereign debt instruments were very similar, with the German issues being seen as the benchmark.

“However, over the last 11-12 months there has been a decoupling of this relationship, so the heavily traded BOBL and BUND are no longer a reasonable proxy for other eurozone government bonds.

“This also means there has been a huge increase in the volumes traded in the underlying market for instruments like BTPs (aka Buoni del Tesoro Poliennali).

“A liquid underlying market – combined with the current levels of volatility and a steady flow of news that has the ability to impact the price – has the potential to make BTPs popular with those spread betting on bonds and interest rates. An expanded interest in fixed income instruments as a whole could follow as well.”

Jones, added, “Fixed income markets have often been seen as too slow moving to be of interest to the majority of the spread betting community. However, with central bankers, politicians and ratings agencies now having the potential to shift bond yields, and so long as the risk of default looms, the popularity of trading these instruments will continue to build.”

IG Index is offering Long-Term Euro-BTP (BTP) futures contracts as determined by Eurex.




User Questions and Answers on Bonds and STIRs

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