MARKET ACADEMY
Separate level, change, return, yield and observation date.
Separate level, change, return, yield and observation date.
Before explaining a number, identify the instrument, currency, unit, observation date, source and comparison window. An equity index level is measured in index points; a Treasury yield is an annualized rate; an FX pair is one currency per unit of another. A quote from yesterday cannot explain a move that occurred an hour ago without additional evidence. Refresh time tells you when the app fetched data, not when the underlying market traded.
A yield rising from 4% to 4.5% increases by 0.5 percentage point or 50 basis points, but by 12.5% relative to its initial level. In rates discussions, the 50 bp description is usually the useful one. An index rising from 100 to 105 gains 5 points and 5%; from 200 to 205 it gains the same 5 points but only 2.5%. Price return excludes distributions; total return includes distributions under the stated reinvestment convention.
The bid is a price a buyer is offering; the ask is a price a seller requests. A market buy generally executes against available asks, potentially at several prices for a large order. A limit order controls the worst acceptable price but may never fill. A displayed midpoint is not an executable promise. Trading costs include the spread, fees and market impact, which can grow in stressed or illiquid markets.
Return = (ending price / initial price − 1) × 100%; yield change in bps = (new yield % − old yield %) × 100Hypothetical bid $99.90 / ask $100.10: the spread is $0.20. Buying then immediately selling at unchanged quotes loses $0.20 per share before fees. It is not a free trade simply because commissions are zero.