Slide 1Interest Rate Risk Interest rate changes have significant effects on many financial firms net income, asset value, liability value and equity value (net difference…
Slide 1 Yields & Prices: Continued Chapter 11 Slide 2 Learning Objectives Understand interest rate risk and the key bond pricing relation Compute and understand the valuation…
Slide 1 Managing Bond Portfolios Slide 2 13.1 INTEREST RATE RISK Slide 3 Inverse relationship between price and yield An increase in a bond ’ s yield to maturity…