Question
A pension plan will have a cash outflow in 3 years. They can invest in 2 year bonds with duration of 1.7 years and 4
A pension plan will have a cash outflow in 3 years. They can invest in 2 year bonds with duration of 1.7 years and 4 year bonds with a duration of 3.7 years. To immunize the portfolio, the proportion invested in the 4 year bonds should be ______ .
A. Show the Formula (0.2 point) B. Show the Steps (0.2 point) C. Present the Answers (0.1 point)
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Fundamentals Of Corporate Finance
Authors: Robert Parrino, David S. Kidwell, Thomas W. Bates
5th Edition
1119795435, 978-1119795438
