Basis point: Difference between revisions
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imported>Doug Williamson m (Spacing) |
imported>Doug Williamson m (Added more space so that calculations are clearer) |
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1. ''Interest rates''. | 1. ''Interest rates''. | ||
One hundredth of 1% = 0.01% = 0.0001 as a decimal. | One hundredth of 1% = 0.01% = 0.0001 as a decimal. | ||
2. | 2. | ||
While bond coupons may be expressed in fractions (for example, quarters, eighths or sixteenths), yields and prices of most money market instruments, such as commercial paper or treasury bills, are quoted in basis points. | While bond coupons may be expressed in fractions (for example, quarters, eighths or sixteenths), yields and prices of most money market instruments, such as commercial paper or treasury bills, are quoted in basis points. | ||
3. ''Foreign exchange rates.'' | 3. ''Foreign exchange rates.'' | ||
One hundredth of a cent, for example $0.0001, or its equivalent in other currencies. | |||
One hundredth of a cent, for example $0.0001, or its equivalent in other currencies. | |||
Often, but not always, this represents a minimum price movement in the related foreign exchange rate quotation. | Often, but not always, this represents a minimum price movement in the related foreign exchange rate quotation. | ||
== See also == | == See also == | ||
Revision as of 13:58, 20 September 2014
(bp).
1. Interest rates.
One hundredth of 1% = 0.01% = 0.0001 as a decimal.
2.
While bond coupons may be expressed in fractions (for example, quarters, eighths or sixteenths), yields and prices of most money market instruments, such as commercial paper or treasury bills, are quoted in basis points.
3. Foreign exchange rates.
One hundredth of a cent, for example $0.0001, or its equivalent in other currencies.
Often, but not always, this represents a minimum price movement in the related foreign exchange rate quotation.
