Basis point (bp or bps)

A change in the interest rate of 1/100 of 1%. 1% equals 100 basis points or bps. Therefore, one basis point (1 bp) is equivalent to 0.01%. While bond coupons may be expressed in fractions (i.e. in quarters, eighths or sixteenths), yields and prices of most money market instruments, such as commercial paper or treasury bills, are quoted in basis points.