Global Yield Spread

8 jul 2023

The Global Yield Spread is a simple indicator that can help to identify economic wellbeing and thus allows traders and investors alike to derive a rough estimation onto where the market is likely to go.

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Please note that things like Yield Spread generally influence the market only over longer time horizons of a couple weeks to many months.
Also be aware that the Yield Spread is only capable of measuring the Yields on Bonds and is thus limited to only changes that are reflected in the interest rates on the Bonds.
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The Normal Yield Spread is widely recognized for it's signal abilities for recessions or general economic well being...

However, since the rates have decreased drastically in the US something else has been proposed: The Global Yield Spread
As the normal US Yield Spread is loosing signal capacity because the US government can easily borrow money from overseas,
thus reducing the need to increase interest rates.

By monitoring and analyzing the Global Yield spread, traders and investors can gain insights into relative valuations, economic movements, market sentiment, and opportunities.
It can help inform their investment decisions and strategies, allowing them to allocate capital more effectively and potentially generate better returns.

You have options to visually represent a diversity of Countries and their according Yield Spreads.
Furthermore there are Global Yield Spreads for:

• 10Y-03MY
  
• 10Y-02Y
  
• 30Y-10Y
  

The Average Global Yield Spread encompasses the 3 options above to get an average reading.