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An analyst predicts that the yield curve will twist at the 10 year maturity, The 1-year zero-coupon government bond yield to maturity will increase by

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An analyst predicts that the yield curve will twist at the 10 year maturity, The 1-year zero-coupon government bond yield to maturity will increase by 1% while the 21-year zero-coupon government bond yield to maturity will decrease by 1%. Fixed Income securities available in the market have a maximum maturity of 21 years and a minimum maturity of 1 year. If the analyst's prediction does come true, which of the following investment strategies will result in the highest returns? Aladder which is an equally weighted allocation across all maturities of zero-coupon government bonds. A barbell strategy which allocates 10% to 1-year zero-coupon government bonds and 90% to 21-year zero- coupon government bonds. A bullet strategy which allocates 100% to 21-year zero-coupon government bonds. A bullet strategy which allocates 100% to 1-year zero-coupon government bonds. A barbell strategy which allocates 40% to 1-year zero-coupon government bonds and 60% to 21-year zero- coupon government bonds. An analyst predicts that the yield curve will twist at the 10 year maturity, The 1-year zero-coupon government bond yield to maturity will increase by 1% while the 21-year zero-coupon government bond yield to maturity will decrease by 1%. Fixed Income securities available in the market have a maximum maturity of 21 years and a minimum maturity of 1 year. If the analyst's prediction does come true, which of the following investment strategies will result in the highest returns? Aladder which is an equally weighted allocation across all maturities of zero-coupon government bonds. A barbell strategy which allocates 10% to 1-year zero-coupon government bonds and 90% to 21-year zero- coupon government bonds. A bullet strategy which allocates 100% to 21-year zero-coupon government bonds. A bullet strategy which allocates 100% to 1-year zero-coupon government bonds. A barbell strategy which allocates 40% to 1-year zero-coupon government bonds and 60% to 21-year zero- coupon government bonds

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