Bond price gains: what the ranking measures and why a rise lowers future yield

The list of bonds that have risen more than the rest sits directly below this paragraph: it is sorted by price change over the month, from the largest gain to the smallest, and is recalculated from the platform's database — the line-up changes, which is why no security is named in the text. The main thing to understand before looking at it: a rise in a bond's price and the benefit of buying that bond are opposite things. The more expensive the bond is today, the less there is left to earn for whoever comes for it after the rally.

What exactly is measured

There is one criterion here — the change in the market price over the past month, as a percentage of the price at the start of the period. It is not yield, not the coupon and not the total result of holding the bond. A bond trades as a percentage of its face value, and it is precisely this ratio that moves: the bond may go above par or may stay below it — the ranking records the direction and size of that shift, not its cause.

There is an important subtlety that leads readers to argue with their brokerage apps: a bond has a clean price and a dirty price — the second includes accrued coupon interest. The dirty price creeps up mechanically every day simply because the coupon payment is getting closer, and the accrued interest resets to zero on the payment date. A ranking built on the dirty price would mix market movement with coupon accrual; a ranking built on the clean price shows only the market repricing. Which of the two prices underlies a particular sort order is a question for the platform's methodology, not for this text: if it is not stated next to the table, treat the top rows with more caution and check them against the total return.

Why the price rises

The reasons are few, and they differ in what they mean.

The most widespread is a change in rate expectations. The price of a fixed-coupon bond moves against the interest rate: when the market expects a rate cut, older bonds with a high coupon become more expensive. Long-dated issues gain the most, and that is sensitivity, not quality — the same mechanism will turn them down when rates move the other way. This relationship is examined in the article on duration.

The second reason is a reassessment of credit risk. If an issuer publishes results or news that dispel concerns, its bond rises quickly and noticeably, especially in the high-yield bond segment. Here the gain says that fear has receded, not that the risk is gone.

The third is the structure of the issue itself. For inflation-linked bonds it is the face value that is revalued, and the mechanics there are different — they are described in the article on inflation-protected bonds. For substitute bonds the rouble price responds to the exchange rate, and a row in the ranking may reflect a currency move rather than the market's view of the issuer.

Finally, the price is pulled towards par as redemption approaches — for a bond bought at a discount this is an expected and predictable rise. And for issues with amortisation the face value is repaid in instalments, so the percentage price behaves differently from that of a conventional issue.

What cannot be concluded from this list

You cannot conclude that the rise will continue: a sort by a past period carries no information about the next one. You cannot conclude that the issuer is sound — sometimes what rises is exactly what had been falling out of fear. You cannot compare the rows with each other as if they were alike: a long OFZ and a short corporate issue have gained for reasons that are not comparable. And you cannot equate a price move with the result of holding the bond — for that you calculate yield, and more than one of them, which is the subject of the article on three different yield figures.

A separate caveat is liquidity. In a thinly traded issue, one trade is enough to push the bond into the top rows. Check the volume and the spread on the instrument page before treating such a move as a market signal.

How to read the table

Step 1 — look at the time to maturity: it explains most of the difference in the moves. Step 2 — separate government issues from corporate ones, opening the OFZ section as the reference point for rates. Step 3 — for a bond that has caught your interest, open its yield to maturity and compare it with what it was before the rise. Step 4 — subtract the tax: how it changes the choice is explained in the article on coupon tax. Step 5 — ask yourself what caused the rise; if there is no answer, a row in the ranking is no substitute for one.

A useful way to use this list is not as a shop window of things to buy, but as an indicator of where market expectations have shifted over the month. If the top is taken up by long-dated bonds, the market is pricing in a rate cut. If it holds individual corporate issues with no common pattern, these are stories of specific issuers, and the place to look is the financial reports and the news, not the percentage change in price.