Yield Curve

A yield curve is a process for plotting data on a graph to calculate yields on various investments over different time periods. It was traditionally used to plot yields for financial elements like bonds. Yield curves are also useful for yield farming in digital currency. Yield curves portray the relationship among the interest rates (or borrowing cost) and the term (or time to maturity) of an asset or group of assets. There are three main types of yield curves which include normal, inverted, and flat. Normal or upward sloping curves portray economic growth, while inverted or downward sloping curves portray economic decline or recession.