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10 YR T-Note Hedger

A hedger in the 10 YR T-Note market is an individual who uses the futures market to offset price risk when intending to sell or buy the actual 10 YR T-Note. Hedging is possible because the 10 YR T-Note cash prices and 10 YR T-Note futures prices tend to move in the same direction. However, the difference between the cash price and the futures price may narrow or widen. The change in the difference between the cash price and the futures price is called basis risk. Because of the changing basis no hedge can be perfect.


Where can you hedge the 10 YR T-Note? The 10 YR T-Note can be hedged on the Chicago Board of Trade (CBOT). The CBOT offers a competitive and transparent market place to engage in efficient hedging strategies. If you are interested in hedging 10 YR T-Note please contact us. One of our experienced 10 YR T-Note traders will be happy to give you a call to discuss hedging strategies with you.

Hedging a Fixed-Income Portfolio with Swap Futures

Click on the link above to download a very informative .pdf brochure entitled "Hedging a Fixed-Income Portfolio with Swap Futures.” It was published by the Chicago Board of Trade. This is a must read guide for any novice or advanced trader considering a hedge in the bond market using exchange traded 10 YR T-Note futures and options.