Bond Market Escape Velocity BETA

About This Tool

This tool identifies the point on the government bond yield curve where the bond yield equals its modified duration — the escape velocity.

At this point, interest income can offset price declines from rising rates, over a 1 year period, meaning the bond can “break free” from interest risk over the period in which it earns its interest. This is the point on the yield curve where bonds are very nominally safe and also have reduced interest rate risk because of current interest rates relative to current durations. On this chart any point where the blue line is above the orange line would reflect some "escape" income.

Use it to see where along the curve bonds may offer better risk-reward in rising-rate environments.

To understand this concept in more detail please Read the full article

Govt Bond Yield Curve & Calculation

Maturity Years Yield (%) Mod Duration
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