什麽是 TED SPREAD ? (圖)
文章來源: wavePlayer2008-10-14 16:14:46

Many people ask me what is TED SPREAD?  Where to get Ted spread quote.  From here you can get most of the answers. Hope this will be helpful.

What is TED SPREAD?

The TED spread is the difference between three-month LIBOR (the London Inter Bank Offered Rate) and three-month US Treasury bills

The 3-month Treasury is virtually risk-free (backed by the full faith and credit of the U.S. government), while lending money to banks can be hazardous to your bottom line. Those who lend to banks deserve something in return for taking on that risk – a premium above what they would have earned by buying Treasuries. That premium is called the TED spread.

Where to find TED SPREAD Chart?

Here is the link for TED SPREAD quote and daily chart:

http://www.bloomberg.com/apps/quote?ticker=.TEDSP:IND

Why TED SPREAD is so important?

There are more than 45 Trilling capital lending around Global based on LIBOR rate. That includes Mortgage Rate, Home loan, Business loan, Student loan, Car loan, etc. If TED SPREAD remains at high level, business can not get loan from the banks or significantly increase the cost of borrowing, this could seized business or significantly damage the business earning power. Most Companies can not do business with each other. This will cause deep economic recession.

Why TED SPREAD is important to stock market?

The current crisis is a function of tight credit. The focus should be on the TED spread, which directly measures credit conditions and is a widely watched barometer of interbank lending.

Last Friday, the TED spread widened to about 455 basis points, the biggest gap in over a decade. This is a spread that many market observers never envisioned seeing. The TED spread is usually around 50 basis points, but rose above 100 basis during the start of the credit crisis. On Sept. 5, the TED spread was just 104 basis points. The most troubling aspect of this 450 plus spread is the fact that the current TED spread mirrors the spread level before the market crash of 1987.

Why is the TED spread rising?

Banks are not keen to lend money right now, and they are demanding a higher premium to do so. After all, so many financial institutions have fallen by the wayside recently, with new names added to the list daily, and this has severely dampened enthusiasm for lending.

The three-month LIBOR is essentially what banks charge each other to borrow money. The spread also reflects declining yields for three-month treasury bills as investors flee to the safety of treasuries, paying higher prices for the three-month bills and accepting lower yields. As investors flock to ultra-safe government treasury bills, yields have fallen. Also, banks' distrust of lending to each other pushes interbank lending rates up, creating a large spread. The TED spread is a key indicator of risk. A wide spread indicates a bigger aversion to risk and points to evidence of distress in the financial market.

Happy Trading!!