Question

currently the yield on a 10-year abc corporate bond is 4.25%, while the yield on a 10-year treasury bond is 3.50%. what would the credit spread between these two bonds be in basis points?

Answer 1

Spread is 4.25 - 3.50 = 0.75% or in basis points multiply it by 100, 75 basis points.

Percentage is per 100, but basis points are per ten thousand (10000).