The Yield Curve Explained

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FOR EDUCATION ONLY

The yield curve allows fixed-income investors to compare similar Treasury investments with different maturity dates as a means to balance risk and return. Learn how to calculate the yield curve, identify its different shapes, and explain what these shapes mean.

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Amid a shaky marketplace, investors are eyeing the yield curve for signs of economic stability. History shows that when the yield curve inverts, a recession may soon follow. Photo Composite: Stephanie Swart for The Wall Street Journal.

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