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CFDs are leveraged products and can result in the loss of your capital. Rankings are influenced by affiliate commissions. All information collected on 1/11/2017.

The Ultimate Guide to

Choosing a Broker
For US Ten Year

Not sure which broker is right for you?

Don’t worry - we’ve got you covered. In this guide, you’ll learn:

Ready?

Part 1

Why Choose
For US Ten Year?

scored best in our review of the top brokers for us ten year, which takes into account 120+ factors across eight categories. Here are some areas where scored highly in:

  • + years in business
  • Offers + instruments
  • A range of platform inc.
  • 24/7 customer service
  • Tight spreads from pips
  • Used by 0+ traders
  • Offers demo account
  • 0 languages
  • Leverage up to

offers one way to trade: . If you wanted to trade USTENYEAR through copy trading or other means, skip to part two.

The two most important categories in our rating system are the cost of trading and the broker’s trust score. To calculate a broker’s trust score, we take into account a range of factors, including their regulation history, years in business, liquidity provider etc.

have a trust score, which is . This is largely down to them being regulated by , segregating client funds, being established for over years, and much more. For comparison:

Trust Score comparsion

Trust Score
Year Established
Regulated by
Uses tier 1 banks
Company Type Private Private Private
Segregates client funds

The second thing we look for is the competitiveness of the spreads, and what fees they charge. We've compared these in detail in part three of this guide.

Part 2

Who is (& Isn’t)
Suitable For

As mentioned, allows you to trade in one way: .

Suitable for:

  • Spread Betting
  • CFD Trading
  • Forex Trading
  • Social Trading

Not Suitable for:

To trade with , you'll need a minimum deposit of $. offers a range of different account types for different traders including a , .

Finally, isn't available in the following countries: . They do not offer islamic accounts either.

Part 3

A Comparison of vs. vs.


Want to see how stacks up against and ? We've compared their spreads, features, and key information below.



Spread & fee comparsion

The spreads below are illustrative. For more accurate pricing information, click on the names of the brokers at the top of the table to open their websites in a new tab.
Fixed Spreads
Variable Spreads
EUR/USD Spread
GBP/USD Spread
DAX Spread
FTSE 100 Spread
S&P500 Spread

Comparison of account & trading features

Spread type
EUR/USD Spread
EUR/GBP Spread
Crude Oil Spread
Gold Spread Private Private Private
DAX Spread

Part 4

What are Bonds?

A bond represents a loan that a bondholder makes to the issuer of the bond. It embodies the bond issuer’s promise to repay the principal amount on a certain date in future with periodic interest payments. While stocks represent ownership of an organisation, a bond is an IOU agreement which obligates the borrower to make interest payments and repay the principal at maturity. In terms of ownership privilege, a bondholder’s claim is secondary to a stock holder’s claim, however the risk associated with bonds is lower than stocks as the issuer has a legal obligation to pay interest and repay the principal.

Bonds can play a critical role in a well-diversified portfolio by offsetting the volatility of stocks and providing a source of steady income through interest payments. The bond market is one of the largest securities markets in the world, and provides traders with multiple trading avenues.

UK Bonds Market

UK Bonds Market – markets.ft.com

Bonds Terminology

  • Par Value: Also known as the face value of a bond, it represents the principal amount that is returned to bondholder at the end of maturity period.

  • Coupon Rate: The coupon rate is the rate at which bond issuer promises to pay the bondholder on a periodic basis. For a bond with a par value $100, an annual coupon rate of 5% and maturity 10 years, the bondholder is paid $5 every year for 10 years as coupon payment. At the end of 10 years, the bond matures to pay off the face value of $100.

  • Discount: Bonds do not trade at their par value, they may trade above or below it. If a bond trades at a value below its par value, it is said to be trading at a discount. A bond with a par value of $100 trading at $95 can be considered to be trading at a $5 discount.

  • Premium: Bonds trading at value greater than their par value are said to be trading at a premium. A bond with par value of $100 trading at $105 can be considered to be trading at a $5 premium.

  • Bond Credit Rating: The credit rating of a bond is the opinion of an independent rating agency regarding the ability of the issuer to pay the regular interest on the bond and finally repay the principal at maturity. If the payments are not made in full or in time then the issuer is said to have defaulted. Major credit rating agencies such as Standard & Poor’s, Moody’s and Fitch provide ratings for these bonds which range from the highest down to the ‘junk’ category. As the quality of a bond reduces, the interest on it typically goes up to compensate the trader for the higher risk.

Interest Rates and Bond Prices

Interest rate movements and bond prices follow a negative correlation, i.e. whenever a macroeconomic benchmark interest rate (eg: the repo rate) falls, bond prices increase and vice versa. To take an example, a bond issued last year at par value of £100 offers an interest rate of 5%, however due to inflation in the economy, the government increases their benchmark rate (repo rate) in the current year after which market wide interest rates go up too. So any new bonds issued after the rate hike will carry higher interest in accordance with the increased benchmark interest rate. So a £100 par value bond issued in the current year will offer a higher interest rate, say 5.25%. This makes any of the older bonds less attractive with respect to newly issued bonds and their market price tends to fall. The opposite of this happens when benchmark rates go down and the bonds issued in the past become more attractive thereby increasing their market price. This correlation of interest rate and bond prices is important for traders as it helps them to take an informed stance on price movements.

Types of Bond

Bond issued by federal/central governments: These securities are issued by central treasuries and the money raised through them is used by the government for fiscal spending. The maturity period of these bonds could be 1 year, 10 years or even more. In economically sound countries, these bonds carry the lowest default risk as they are backed by the government’s promise.

Local Government/Municipal bonds: These bonds are typically issued by municipal corporations and state government to finance public improvement projects. Their interest is mostly exempt from government taxes and sometimes local taxes as well. The credit rating of municipal bonds is often reasonably good.

Corporate Bonds: Corporations borrow from traders through corporate bonds. Independent credit rating agencies rate these bonds and depending on the issuing company their ratings can vary from AAA to junk. Since these bonds carry higher risks than government bonds they often pay higher interest than government bonds.

Bond Funds

Just like stock mutual funds, bond funds invest pooled assets based in a variety of bond instruments. Typically bond funds are of the following types:

  • Actively Managed Bond Funds: For such funds, the fund managers pick a variety of bonds to include in order to try to outperform bond indexes. These would include mutual funds and closed end bond funds.

  • Bond Index ETFs: These funds track the movement of popular bond indexes in the market and their units can be freely traded on an exchange.

Speculative trading – Bond CFDs

Bond CFDs allow traders to speculate on price movements of popular treasury bonds such as US 10 year Treasury notes. They work like a derivative instrument, allowing traders to speculate on bond future contracts without actually taking the ownership of bond itself. With CFDs, traders can amplify their exposure to relatively small price movements because of the margins at play. Some popular regulated brokers who provide platforms to trade bond CFDs are as below:

  • Avatrade – CFDs are available on 5 Year US T-Notes, 10 Year US T-Notes, 30 Year US T-Bond, Euro-Bund, Japan Government Bond

  • Cityindex – CFDs are available for US T-note 5yrs and 10yrs, US –T bonds, UK Long Gilt, Euro Scatz, BTP Italian bonds

  • IG – CFDs are available for US T-note 5years and 10years, German Bund, German Buxl, German Schatz, OAT French govt. bonds

These regulated brokers offer features such as tight spreads, excellent trading platforms, good leverage, actionable trade ideas, anytime-anywhere trading.

Conclusion

Bonds are essentially debt securities which offer periodic interest payment and principal repayment at maturity. They provide an efficient alternative to stocks for those traders who don’t like the risk of equity markets and are looking for a constant source of periodic income. They serve an important role in portfolio design by balancing the overall portfolio risk. Being a widely popular security they have a healthy derivative market growing around them for speculators and traders.


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