What does 'benchmark bonds' mean?

Answer 1

They are bonds against which the market is measured. There are literally thousands of bonds issues outstanding. A benchmark bond is a bond against which all others are measured. In statistics, it is the concept of the principal component. If you watch the benchmark, most of the variation in the market sits in that bond alone and the others, while they vary differently, don't vary differently enough to worry about measuring by themselves. Just measure the benchmark and you should have enough knowledge to estimate the whole market of similar issues.

Answer 2

Haha, you ask funny questions!!!!65