ripvanwinkle
Well-Known Member
All that is necessary for evil to succeed is that good men do nothing - Edmund Burke 1729 -1797
Joined: Jan 9, 2011 22:36:42 GMT -5
Posts: 1,349
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Post by ripvanwinkle on Feb 11, 2022 1:30:08 GMT -5
Anyone here give me a short course on these. I know nothing about them. A guy at work said he inherited some from his mom and didn't know what to do about them. I hear all the time the rates. Today I saw on the news the 10yr note was about 2.00%. I have no idea what that means. Does it mean if I buy a $1000 note, after 10yrs I"l receive $20.00? Or is that per year? And how does this affect the stock market?
That seems paltry return for the length of time for the money. I might do better at the casino. Why would I buy these? Who buys these? People with millions of dollars? Is the return taxable?
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clarkrl2
Administrator
Joined: Dec 20, 2010 17:57:01 GMT -5
Posts: 5,795
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Post by clarkrl2 on Feb 11, 2022 13:53:50 GMT -5
The 2% is an annual rate based on the price the 10 year note is currently selling at. If you bought a 10 year note at 4% that rate should hold for the duration of the not and you get your principal however as the price of the note goes up the rate goes down.
It should work something like this. If you bough a $1000 ten year note at 2% you would receive 2% annually for 10 years. However if you decided to sell the note before the ten years was over you may receive more or less than the $1000 thus effecting the new holders rate.
Someone else can probably give a better explanation.
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djAdvocate
Member Emeritus
only posting when the mood strikes me.
Joined: Jun 21, 2011 12:33:54 GMT -5
Posts: 75,086 
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Post by djAdvocate on Feb 28, 2022 19:16:10 GMT -5
TIPS
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