The U.S. Treasury market is the largest interest rate market in the world. As of 2020, the total outstanding amount of Treasury debt was nearly $21 trillion.1 Many global rates are pegged to U.S. Treasury maturities, including many consumer rates like mortgages.
Historically trading changes in the yield on U.S. Treasuries was reserved for dealers and large commercial institutions. Yield futures from CME Group are a new product, based on the yields of benchmark 2-, 5-, 10-, and 30-year Treasury securities scaled in size to the self-directed retail trader.
Simple in their design, the futures contacts are cash settled and trade in yield rather than price terms and have a common DV01 of $10 per contract maturity. The minimum price change increment is 1/10 of a basis point equal to $1 per contract.
Image and article originally from www.cmegroup.com. Read the original article here.