Sản phẩm & Rủi roCâu 40 / 398
Two bonds are identical except for maturity. Which bond's price will generally change MORE for a given change in interest rates?
a.The bond closest to maturity
b.Both change equally
c.The one with the higher credit rating
d.The bond with the longer maturity
Giải thích
Longer-maturity bonds have greater interest-rate sensitivity (higher duration), so their prices move more for a given change in rates. Maturity, not credit rating, drives this effect, and the two do not move equally.
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Câu hỏi liên quan cùng chủ đề
- For a bond purchased at a discount, which of the following relationships is correct?
- Yield to maturity (YTM) is best described as the total return an investor earns if the bond is:
- If a bond's current yield is 5% and its coupon rate is 5%, the bond is most likely trading at:
- An investor buys a bond at par with a 4% coupon. If market rates later drop to 2%, the market value of the investor's bond will most likely:
- Nominal yield on a bond refers to:
- Duration is a measure that helps investors estimate:
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