Five Against Bond Spread (FAB)
A spread in the futures markets created by taking offsetting positions in futures contracts for five-year treasury bonds and long-term (15-30 year) treasury bonds. Investopedia Says:
A FAB spread is created by either buying a futures contract on five-year treasury bonds and selling one long-term treasury bonds or vice versa. Investors speculating on interest rate fluctuations will enter into this type of spread in hopes of under or overpriced treasuries. Related Terms:
Cash Commodity
Cheapest to Deliver
FAN Spread
Futures Contract
Spread
Treasury Bond
Treasury Note
Yield Curve |