What is a spread to Treasury?

It is the difference between a bond or loan's yield and the yield of a Treasury security with a similar maturity. The spread represents the extra yield investors demand to compensate for credit risk, liquidity risk, and other factors beyond the risk-free rate.

What is a basis point?

One basis point (bps) equals 0.01 percentage points. A spread of 150 bps means the bond yields 1.50% more than the matching Treasury. Spreads are quoted in basis points because changes are often small fractions of a percent.

Which Treasury maturity should I use?

Match the Treasury maturity to the bond's time to maturity or duration as closely as possible. For a 10-year corporate bond, use the current 10-year T-note yield. For shorter instruments, use the 2-year or 5-year yield.

What is a normal spread for investment-grade bonds?

It varies with market conditions. Investment-grade corporate bonds typically trade 50–200 bps over Treasuries. High-yield bonds can trade 300–800+ bps over, depending on credit quality and market sentiment.

Is a higher spread always bad?

A higher spread means higher risk premium demanded by the market, which often signals lower credit quality or higher perceived risk. However, from a buyer's perspective, a higher spread means more income if the issuer does not default.

Spread to Treasury Calculator

Name: Spread to Treasury Calculator
Availability: InStock
Author: Nham Vu

Enter a bond or loan yield and the matching Treasury rate to instantly see the spread in basis points and percent.

Inputs

Bond / Loan Yield (%)

Yield to maturity of your bond or loan, as a percentage.

Benchmark Treasury Yield (%)

Current yield of the matching-maturity Treasury security.

Benchmark Label (optional)

Result

Enter both yields and click Calculate.

Typical Spread Ranges

Category	Spread (bps)
Agency / GSE	10 – 50
AAA / AA Corporate	50 – 120
A / BBB Corporate	100 – 250
BB High Yield	250 – 450
B / CCC High Yield	450 – 1,000+

Indicative ranges; actual spreads vary with market conditions.

Summary

Enter a bond or loan yield and the matching Treasury rate to instantly see the spread in basis points and percent.

How it works

Enter the yield of your bond or loan (as a percentage, e.g. 5.75).
Enter the yield of the matching maturity Treasury (e.g. 4.25 for a 10-year T-note).
The calculator subtracts the Treasury yield from the instrument yield.
The result is shown both in basis points (bps) and as a percentage.
A negative spread means the instrument yields less than the Treasury — unusual but possible for agency securities.

Use cases

Assess credit risk premium on corporate bonds versus risk-free Treasuries.
Compare investment-grade versus high-yield bonds on the same maturity benchmark.
Evaluate loan pricing relative to the current Treasury curve.
Track spread tightening or widening over time as credit conditions change.
Determine the extra yield compensation investors demand for holding credit risk.
Support fixed-income portfolio construction and relative-value analysis.

Frequently Asked Questions

Last updated: 2026-07-24 · Reviewed by Nham Vu