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To: Defrocked who wrote (38665)	5/5/1999 3:47:00 PM
From: Investor2	Read Replies (1) of 86076

Re: Bonds 101 "An approximate rule of thumb is that every three price ticks for the futures contract is about 1 bp in yield for the long bond. Thus, a one point price move( 32 ticks) is about 10 basis point in yield(32/3 about 10)." 1. So, if the futures contract moves from 120 to 121 (up 32 ticks), the interest rate will drop about 0.1% (e.g., from 5.7% to 5.6%). Right??? 2. Does it follow then that a contract price of 110 (320 ticks lower than 120) corresponds to an interest rate of 6.7% (100 basis points higher than the current 5.7%)??? 3. What interest rate does a futures contract of 100 correspond to? (Do you see what I'm getting at?) Best wishes, I2

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