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An insurance company must make a payment of $13000 in 4 years. Yields are currently at 6.4%. The companys portfolio manager wishes to fund the
An insurance company must make a payment of $13000 in 4 years. Yields are currently at 6.4%. The companys portfolio manager wishes to fund the obligation using one year zero-coupon bonds and perpetuities paying annual coupons. What is the weight on the perpetuity in an immunized portfolio? Please give your answer in decimal terms rounded to four decimal places.
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