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How to open an FBS account?
Click the ‘Open account’ button on our website and proceed to the Personal Area. Before you can start trading, pass a profile verification. Confirm your email and phone number, get your ID verified. This procedure guarantees the safety of your funds and identity. Once you are done with all the checks, go to the preferred trading platform, and start trading.
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How to withdraw the money you earned with FBS?
The procedure is very straightforward. Go to the Withdrawal page on the website or the Finances section of the FBS Personal Area and access Withdrawal. You can get the earned money via the same payment system that you used for depositing. In case you funded the account via various methods, withdraw your profit via the same methods in the ratio according to the deposited sums.
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How to start trading?
If you are 18+ years old, you can join FBS and begin your FX journey. To trade, you need a brokerage account and sufficient knowledge on how assets behave in the financial markets. Start with studying the basics with our free educational materials and creating an FBS account. You may want to test the environment with virtual money with a Demo account. Once you are ready, enter the real market and trade to succeed.
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How to activate Level Up Bonus?
Open Level Up Bonus account in web or mobile version of FBS Personal Area and get up to $140 free to your account.
Yield Spread
Yield Spread
Usually, debt instruments with different characteristics (maturity date/credit rating or risk) have different yields. Let’s take bond yields as an example and analyze the risks related to them. The bond yield is the return rate, which holders of bonds get if they have this bond until maturity and receive the cash flows at the promised dates. The risks include a credit risk, an interest rate risk, an inflation risk, etc.
We can divide the measures of yield spread into the nominal spread (G-spread), interpolated spread (I-spread), zero-volatility spread (Z-spread) and option-adjusted spread (OAS).
G-spread
Nominal spread (G-spread) represents the difference between Treasury bond yields and corporate bond yield with the same maturity. Treasury bonds have zero default risk, that is why the difference between corporate and Treasury bonds show the default risk. We can calculate the G-spread by using the following formula:
G-Spread = corporate bond’s yield – government bond’s yield
I-spread
Interpolated spread (I-spread) is the difference between a bond's yield and the swap rate. We can use LIBOR as an example. It shows the difference between a bond's yield and a benchmark curve. If the I-spread increases, the credit risk also rises. I-spread is usually lower than the G-spread.
Z-spread
This type of spread is also known as a zero-volatility spread. It is the spread that is added to each spot interest rate to cause the present value of the bond cash flows to equal bond’s price.
Option-adjusted spread
The option-adjusted spread is calculated as zero-volatility spread minus the call option’s value. There is a term “spread” in the Forex market, too. It is referred to the commission you pay a broker. The Forex spread is calculated as a difference between the bid and ask prices.
2022-04-11 • Updated
