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Bond Portfolio Immunization Techniques by lenovoji is a document available to read on EtoBox.

What is Bond Portfolio Immunization Techniques about?

(1) A bond portfolio manager can immunize a portfolio against interest rate changes by matching the duration of the portfolio to the investment planning period. (2) The document provides an example of how to create an immunized two-bond portfolio with a duration of 5 years to match a 5-year planning period. (3) With the immunized portfolio, a drop in interest rates from 10% to 6% would still achieve the target 10% return over 5 years, demonstrating how the technique protects against interest rate change

Author

lenovoji

Language

EN