The 10 year note is trading at about 100. The dec. 10 year note future is trading at about 110. I don't understand how this is possible. Couldn't you just sell dec. futures for 110 and buy the actual notes for 100 to cover yourself and huge riskless profit? Of course this isn't the case, so what don't I understand?
Oh God! Stop trading!! The 10-year note futures contract has a 6% coupon. The cash 10-year note you're looking at has a smaller coupon. They're both priced in such a way to provide nearly identical total returns. If you bought one and sold the other, you wouldn't earn any money.
I saw this question in a previous post layed down in the exact same style and getting quite a few replies. It can't be you again, or are you so nuts?
................Grandpa, please tell me more about these people known as "floor traders"...................
Jesus...chill out. Yes, I asked the same question in two forums because I didn't know which the proper forum was for the question. I'm a teenager that isn't trading a f*cking cent of money. I'm just curious about the market and don't really know anywhere else to go for answers.
Go pull another tube man, you already got an intelligent response last week. You need to hear it again? http://www.elitetrader.com/vb/showthread.php?s=&threadid=56306
Hey surdo, thanks for being so observant. Of course maybe you'd like to check the date of my posts and notice that I asked the question a second time on a different forum before anyone answered once. I DID NOT ask a second time after already getting an answer.
metz-- I know Pabst and co. gave you some details about difference between coupons and price but you got also some links where you might find exhaustive answers to your q. and more: check them and if you want to trade bonds you may buy a book that was suggested to you in you previous post. Good luck P