am 2 Type 2 33. Yields on short-term bonds tend to be more volatile than yields on long-term bonds. that you have estimated that the yield on 20-year bonds changes by basis-point move in the yield on 5-year bonds. You hold a Si.5 million portfolio of 5-year maturity bonds with modified duration 4 years and desire to hedge your interest rate exposure with T-bond futures (maturity is 20 years), which currently have modified duration 9 years? The T-bond futures contract currently has value of $70,000. Should you buy or sell T-bond futures contracts to hedge your bond portfolio? How many futures contracts should you buy or sel? (6 points) Suppose 10 basis points for every 21