RisksAssociatedwithInvestinginBonds幻灯片.pptVIP

Yield Curve Risk Exhibits 1 and 2 in the text show a four bond portfolio to highlight the impact of the changes in value relative to a 25 basis point shift. Three examples are provided: A. Parallel shift in the yield curve B. and C. Nonparallel shifts in the yield curve The example highlights yield curve risk, which exposes the risk caused by different changes in interest rates for differing maturities Duration can be used on a portfolio of fixed income securities to understand the approximate change in a portfolio’s value for a 100 basis point change in the yield for all maturities. Yie