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…
The Relationship Between Interest Rates and Option-Free Bond Prices Bond Prices A bond’s price is the present value of the future coupon payments (CPN) plus the present…
Dr. Himanshu Joshi Change in interest rates results in change in prices of bonds in reverse direction. Interest rate increase = Price will fall to offer in-built capital…
The Relationship Between Interest Rates and Option-Free Bond Prices Bond Prices A bond’s price is the present value of the future coupon payments (CPN) plus the present…
Dr. Himanshu Joshi Change in interest rates results in change in prices of bonds in reverse direction. Interest rate increase = Price will fall to offer in-built capital…
Bond Strategies FNCE 455 Class Session #11 Lloyd Kurtz Santa Clara University * The Strategies Interest Rate Anticipation Cash Flow Matching Duration Management * Interest…