Question
An immunized bond portfolio is created to pay a future liability. The portfolio has a YTM of 7%. The liability consists of an expected payment
An immunized bond portfolio is created to pay a future liability. The portfolio has a YTM of 7%. The liability consists of an expected payment of $3 million in 2 years and an expected payment of $5 million in 4 years. What should be the duration of the bond portfolio?
Answer is 3.19 year
just need math
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Fundamentals of Financial Management
Authors: Eugene F. Brigham, Joel F. Houston
12th edition
978-0324597714, 324597711, 324597703, 978-8131518571, 8131518574, 978-0324597707
