Parallel and Non-parallel Shifts in Yield Curve

Parallel Shift

Rates across the maturity spectrum change by a constant amount and the slope of the yield curve remains consistent.

Non-Parallel Shifts

  • Twist: The slope of the yield curve becomes flatter (the spread between short and long term yields narrows) or steeper (the spread between short and long term yields widens).

  • Butterfly: Change to the curvature of the yield curve.
    **Positive butterfly:** The yield curve goes loses some of its "hump" and becomes straighter.
    
    **Negative butterfly:** The yield curve takes on more of a hump and ceases to look similar to a straight line.
    
Membership
Learn the skills required to excel in data science and data analytics covering R, Python, machine learning, and AI.
I WANT TO JOIN
JOIN 30,000 DATA PROFESSIONALS

Free Guides - Getting Started with R and Python

Enter your name and email address below and we will email you the guides for R programming and Python.

Saylient AI Logo

Take the Next Step in Your Data Career

Join our membership for lifetime unlimited access to all our data analytics and data science learning content and resources.