Assume You have two bonds with the following data:

Current MV of the first is 100$ Yield 2% maturing in 2 years

Current MV of the first is 150$ Yield 3% Maturing in 3 years

Assuming a continuous model what will be the returns of this portfolio if the first yield will rise by 50 bps ( new Yield is 2.5%) and the second yield rises by 1% ( new Yield is 4%)

Hint: Calc the returns of the bond seperately and then do weighted average

		-2.18%
		-2.6%
		NONE OF THE ABOVE
		-1.9%