Treasury Futures
CBOT futures on US government bonds — including 2-year, 5-year, 10-year notes and 30-year bonds — used to trade interest rate risk.
Treasury futures are CBOT contracts that allow traders and institutions to manage interest rate risk or speculate on the direction of US interest rates. The main contracts are: /ZT (2-year note), /ZF (5-year note), /ZN (10-year note), /ZB (30-year bond), and /UB (ultra bond).
Treasury futures prices move inversely to yields — rising rates mean falling futures prices. The 10-year note (/ZN) is the most liquid and widely followed benchmark for US rate expectations.
Unlike equity index futures, Treasury futures can involve physical delivery of actual Treasury securities that meet the contract's delivery eligibility criteria.
Related Terms
Futures Contract
A standardized, exchange-traded agreement to buy or sell an asset at a fixed price on a set future date, settled daily via mark-to-market.
BeginnerHedger
A market participant using futures to offset price risk in an existing exposure — the opposite of a speculator.
IntermediateIndex Futures
Futures contracts whose underlying is a stock market index — settled in cash against the final index value at expiration.
BeginnerPhysical Delivery
Settlement method where the seller of a futures contract must deliver the actual underlying commodity to the buyer at expiration.
Intermediate