inverted scale

Also found in: Dictionary.
Related to inverted scale: Negative yield curve, Positive yield curve

Inverted scale

A serial bond offering whose bonds with earlier maturity dates have higher yields than bonds with later maturity dates.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Inverted Yield Curve

A yield curve in which the long-term yields on bonds are lower than short-term yields. A normal yield curve trends upward because bondholders expect a larger interest rate for a longer investment; however, if a yield curve turns negative, it indicates that the market believes that demand for long-term debt securities is increasing or will increase, which will drive yields downward. Higher demand for bonds usually occurs when investors believe that stock prices will fall. As a result, an inverted yield curve is a highly bearish indicator and indeed is seen as a predictor of a coming recession. An inverted yield curve is the rarest yield curve. It is also called a negative yield curve.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

inverted scale

An issue of serial bonds having yields on short-term securities that exceed yields on long-term securities. An inverted scale is generally caused when investors judge interest rates to be unusually high and expect them to fall.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.
Mentioned in ?