You can also spread trade between different maturities. When you look at where interest rates are trading compared to what the Treasury futures are doing, it may look confusing at first glance. The Treasury futures are "weighted" to achieve the actual interest rates that you see posted in the cash market. Below are the "tick" equivalents in the Treasury futures, which correspond to a one basis-point change in cash interest rates:

2–Year Note – 1.18
5–Year Note &ndash 0.62
10–Year Note &ndash 0.35
30–Year Bond &ndash 0.2

Below are a few ratios which are theoretically neutral based on the change of the yield curve. (June 2008 contracts)Two–year notes vs. 10–year notes = Long 100 TUM8 / Short 56 TYM8

10–year notes vs. 30–year bonds = Long 166 TYM8 / Short 100 USM8.

Five-year notes v. 30–year bonds = Long 100 FVM8 / Short 37 USM8.

To break it down into smaller trading size, you have to round off each equation by using 2-to-1, 3-to-1, or 4-to-1 ratios since there are no fractions of a contract.This of course moves away from being neutral, but I assume your intention is to try to capture a gain if the yield curve goes your way. You can also make modifications depending on how conservative or aggressive your trading style is, or how bullish or bearish you want your strategy to be.

Take note that the five, 10 and 30-year contracts are $100,000 contracts:

One Basis Point = $31.25

The two-year note is a $200,000 contract:

One Basis Point = $62.50

All Treasury futures are based on price of the notes or bonds.