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A New Exchange for Small Traders Has Turned U.S. Treasuries Upside Down

  • Small Exchange’s new futures move in lockstep with U.S. yields
  • ‘We think that simplicity will really resonate,’ exec says

A fledgling futures market backed by Chicago trading giants including Citadel Securities just rolled out a contract that turns the U.S. Treasury market on its head.

The Small Exchange product rises when the yield on 10-year notes increases, and falls when the rate decreases. That’s novel. Although investors globally fixate on Treasury yields, the dominant derivatives they could previously buy track the inverse: the price of bonds.