Iām trying to read the MBS charts you have been posting in the blog. What does 95-26 mean? And I see the change col, and understand the -9 is or +9. But what is ā+0-26ā ? If you can post a weblink to get this info, that would be great.

1 Answer

Despite being the most advanced country in the world, there are a few areas in which we have not caught up with everyone else. Our measurement system and our bond pricing conventions are two examples of that.

Government bonds are denominated in $100,000 units. However, unlike their European counterparts, United States bond prices do not move in increments based on the
**decimal system**. Instead, they move in points and 32nds of points. For these bonds, a point is worth $1,000. Hence, the value of a bond listed as "100" is worth $100,000 and one listed at "95-0 " would be worth $95,000. When you see "95-26" it means that the bond is worth 95 points and 26/32nds of a point. Translating 26/32nds in to decimals gives us 0.8125. Thus the bond is worth 95.8125 points or $95,812.50. When you see that a bond has changed "+0-26" it means that it has increased in value by zero points and 26/32nds of a point. If the figure listed in the change column was "-0-26" it would mean that the bond decreased in value by 26/32nds of a point. The symbol in front of the first number indicates either an increase (+) or a decrease (-) and the symbol in front of the second number (-) only acts as a separator.

Hope that helps.