# Scenarios

Source: https://www.yieldcurve.pro/scenarios

Apply parallel shifts, twist scenarios, or custom shocks to the
current US Treasury yield curve and see the **price impact** across
all maturities. The simulator uses the **duration + convexity
approximation** for accurate estimates even for large moves.



## Instructions

* select a **Preset** from the dropdown for a common scenario (Fed Hikes, Recession, Bear Flattener, etc.)
* or select a **Type** — Parallel Shift or Twist
* for parallel: enter the **Shift** in basis points (positive = rates up)
* for twist: enter separate **Short End** and **Long End** shifts; intermediate tenors are linearly interpolated
* click **GO** to compute the impact

Results

* **Chart** — the base yield curve overlaid with the shocked curve (both solid lines)
* **Impact table** — per-tenor breakdown:
    * **Base** and **Shocked** yields in percent
    * **Δ (bps)** — change in basis points
    * **ΔPrice ($)** — estimated dollar price change per $100 face, using duration + convexity
    * **Duration** and **DV01** — at the base yield level

Preset Scenarios

* **Fed Hikes +100bp** — parallel shift up; aggressive tightening
* **Fed Cuts -100bp** — parallel shift down; easing cycle
* **Recession** — front end -150bp, long end -50bp; bull steepener
* **Bear Flattener** — short rates +150bp, long rates +50bp; policy tightening
* **Bull Steepener** — short rates -100bp, long end unchanged; rate cuts begin
* **Bear Steepener** — long rates +100bp, short end unchanged; term premium repricing
* **Bull Flattener** — long rates -75bp, short end -25bp; flight to quality
* **Stagflation** — parallel +200bp; persistent inflation

Use Cases

* stress-test a portfolio against standard rate scenarios
* visualize how different parts of the curve respond to specific shocks
* compare the price sensitivity of short vs. long bonds under various macro regimes
* build intuition for duration and convexity effects at different yield levels

Per-scenario pages (e.g. `/scenarios/recession`) show the current
curve under a specific preset shock.