globalen
Credit investing glossary

Definition of basis points

Basis points are a unit of measure that is used, amongst others, to reflect percentage changes in financial instruments. Typically, it is used to represent changes in interest rates, yields and spreads.

Converting percentage changes to basis points

One basis point is defined as one-hundredth of a percentage point, which is 0.01%, and which equals 0.0001.

For example, if a bond yield declines from 7% to 6.75%, the yield has declined by 25 basis points.

If a commercial bank increases its mortgage rate from 4.5% to 5.5%, the rate has risen by 100 basis points.

Consistently at the forefront of credit management
Consistently at the forefront of credit management
Credit investing
Six things you need to know about SDG investing
Six things you need to know about SDG investing
Contributing to the Sustainable Development Goals (SDGs) has become one of the biggest investment opportunities of our time.
20-05-2022 | Insight
Navigating bond markets in times of stagflation
Navigating bond markets in times of stagflation
High inflation and central bank tightening are already leading to rising yields and negative bond returns.
18-05-2022 | Insight
The performance in government bonds is a reminder that it’s all relative
The performance in government bonds is a reminder that it’s all relative
So far this year we’ve seen fixed income assets cheapening faster than at any time in over 40 years.
18-05-2022 | Insight