Investments, tenth edition

Listing of Treasury Issues

MATURITY COUPON

BID

ASKED

CHG

ASK

YLD

Nov 15 13

Nov 15 15

Feb 15 18

Feb 15 20

Aug 15 25

May 15 30

Feb  15 36

May 15 42

4.250

4.500

3.500

8.500

6.875

6.250

4.500

3.000

105.3281

113.5078

115.0703

154.3906

158.6797

161.1094

138.0469

108.2969

105.3438

113.5391

115.1172

154.4375

158.7578

161.1875

138.1250

108.3594

–0.0078

–0.0859

–0.1406

–0.2734

–0.6641

–0.8906

–0.9375

–0.9297

0.212

0.398

0.729

1.107

1.809

2.113

2.378

2.596

 Figure 2.3 

Listing of Treasury bonds and notes  

 Source: Compiled from data obtained from the  Wall Street 

Journal Online,  July 17, 2012. 

 What were the bid price, ask price, and yield to maturity of the 4.5% February 2036 

Treasury bond displayed in  Figure 2.3 ? What was its ask price the previous day? 

 CONCEPT CHECK 

2.1 

issued in increments of $100 but far more commonly trade 

in denominations of $1,000. Both notes and bonds make 

semiannual interest payments called  

coupon payments,  

a name derived from precomputer days, when investors 

would literally clip coupons attached to the bond and pres-

ent a coupon to receive the interest payment. 

  Figure 2.3  is a listing of Treasury issues. Notice the high-

lighted note that matures in November 2015. Its bid price 

is 113.5078. (This is the decimal version of    113

65

/

128

 .  The 

minimum  tick size,  or price increment in the Wall Street 

Journal listing, is generally 

1

/

128

   of a point.) Although bonds 

are typically traded in denominations of $1,000 par value, 

prices are quoted as a percentage of par. Thus, the bid price 

should be interpreted as 113.5078% of par, or $1,135.078 

for the $1,000 par value bond. Similarly, the ask price at 

which the bond could be sold to a dealer is 113.5391% of 

par, or $1,135.391. The  2 .0859 change means that the clos-

ing price on this day fell by .0859% of par value (equivalently, by 

11

/

128

 of a point) from the 

previous day’s close. Finally, the yield to maturity based on the ask price is .398%.  

 The     yield  to  maturity    reported in the financial pages is calculated by determining 

the semiannual yield and then doubling it, rather than compounding it for two half-year 

periods. This use of a simple interest technique to annualize means that the yield is 

quoted on an annual percentage rate (APR) basis rather than as an effective annual yield. 

The APR method in this context is also called the  bond equivalent yield.  We discuss the 

yield to maturity in more detail in Part Four.