Basis points (bps)

The basis point is commonly used for calculating changes in interest rates, equity indexes and the yield of a fixed-income security The relationship between percentage changes and basis points can be summarised as follows: 1% = 100 Basis Points 001% = 1 Basis Point. A bond whose yield increases from 3.42% to 3.49% is said to increase by 7 basis points; or interest rates that have dropped by 0.5% are said to have decreased by 50 basis points

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