What is negative convexity? How does it affect interest rates on mortgages (with prepayment options)?

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Financial Markets Banking And Monetary Policy

ISBN: 9781118872239

1st Edition

Authors: Thomas D. Simpson

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Question Posted: Feb 02, 2024 09:47 AM

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What is negative convexity? How does it affect interest rates on mortgages (with prepayment options)?

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Negative convexity is a term used in finance to describe the shape of a bonds yield curve and its pr...View the full answer

Financial Markets Banking And Monetary Policy

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