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Michelle and Vox unpack a quiet source of confusion in rate markets: a cash Treasury yield can show you where the underlying bond market is trading, but it cannot reveal the full range of policy outcomes by itself. Using futures, option chains, and the idea of an implied distribution, they explain why investors need to separate one market price from the whole map of possible rate paths.
By VoxMichelle and Vox unpack a quiet source of confusion in rate markets: a cash Treasury yield can show you where the underlying bond market is trading, but it cannot reveal the full range of policy outcomes by itself. Using futures, option chains, and the idea of an implied distribution, they explain why investors need to separate one market price from the whole map of possible rate paths.