The 10-year Treasury Bond.
The 10-year Treasury Bond is one of the most significant financial tools for the entire investing world. It can be used as a safe place for cash during volatile stock markets, and it can also be a useful indicator of where cash is currently being invested. The chart below shows the movement of the 10-year bond yield. If investors are buying bonds, the yield will move lower, and if investors are selling bonds, the yield will move higher. So, if money is moving into bonds, it could be potential moving out of the stock markets. Conversely, if money is moving out of bonds, it could potentially be moving into stocks.
John N. Lilly III
Portfolio Manager, DJWG
Bond prices and yields are subject to change based upon market conditions and availability. If bonds are sold prior to
maturity, you may receive more or less than your initial investment. Holding bonds to term allows redemption at par value.
There is an inverse relationship between interest rate movements and bond prices. Generally, when interest rates rise, bond
prices fall and when interest rates fall, bond prices generally rise.
U.S. Government Bonds and Treasury Bills are guaranteed by the government, and if held to maturity, offer a fixed rate of return and guaranteed principal value.