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What is Bond Price Sensitivity to YTM Changes about?

1) Bond prices are sensitive to changes in yield-to-maturity (YTM). The sensitivity can be approximated using duration. 2) Duration measures the average time until cash flows are received. It indicates how responsive the bond price is to changes in YTM, with higher duration meaning greater price sensitivity. 3) Bond price sensitivity and duration are higher when the coupon rate is lower, maturity is longer, or current YTM is lower. This is because a larger portion of the cash flows are further in the fu

Author

kingjaspe

Language

EN