Trading the unheard-of fall in yields to zero

Employees of a foreign exchange trading company work under monitors displaying the 10-year Japanese government bond yield in Tokyo, Feb. 9, 2016.
Yuya Shino | Reuters
Employees of a foreign exchange trading company work under monitors displaying the 10-year Japanese government bond yield in Tokyo, Feb. 9, 2016.

For the first time ever Japan's 10-year bond yield went negative, raising concern that loose central bank policies around the world have finally gone too far and leaving investors scratching their heads on how to trade such an unprecedented situation.

Japan becomes the first G-7 country whose 10-year debt went past zero, which means holders are actually paying the government for the privilege of lending it money. The U.S. 10-year Treasury yield followed in Japan's footsteps Tuesday, declining below 1.8 percent.

With no history book to refer to, how should investors play the global march to negative yields?

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