Financial Indexes
Four of the most widely followed financial indexes are presented and explained below. This handy overview provides a clear and simple definition for each type of index along with the current rate of each. This information is continuously updated as changes in these indexes occur.
1 Year T-Bill
1 Year T-Bill (TCM) – 1 Year Treasury TCM Index - TCM stands for Treasury Constant Maturity. This index is alternatively sometimes expressed as the 1 Year Treasury CMT or Constant Maturity Treasury. It is an index that is calculated by the US Treasury that adjusts all yields on actively traded Treasury securities to a constant maturity of 1 year. This Index is often used to set the rate for adjustable rate loans. This index adjusts more quickly than the 11th District COF and 6 month LIBOR to current market conditions.
|
1 Year T-Bill
0.340% |
|
Prime Rate
Prime Rate - The Wall Street Journal defines the Prime Rate as the "base rate on corporate loans posted by at least 75% of the 30 largest U.S. Banks". The Prime Rate is usually 3% higher than the Federal Funds Rate that is determined by the Federal Reserve Board.
|
Prime Rate
3.250% |
|
11th District COF
11th District COF - COF stands for Cost of Funds (or COFI which stands for Cost of Funds Index). This index is the monthly weighted average interest rates paid on savings and checking accounts offered by savings institutions headquartered in Arizona, California and Nevada. This index is used primarily for adjustable rate loans. The rates are published on the last business day of each month for the previous month (i.e. January COF is published the last business day of February).
|
11th District COF
1.786% |
|
6 Month LIBOR
6 Month LIBOR - LIBOR stands for London Interbank Offered Rate. The 6 month LIBOR rate is the average interest rate that banks are willing to loan money to each other for 6 months in the London wholesale money market. This rate is sometimes used to set the rates for adjustable rate loans. In that case, the rate plus a set margin (number of percentage points) define what interest rate the consumer pays.
|
6 Month LIBOR
0.387% |
|