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Consider a bond with a MacD of 14.6, ModD of 13.8 and DV01 of $2.5. Suppose its yield to maturity goes up one percentage point
Consider a bond with a MacD of 14.6, ModD of 13.8 and DV01 of $2.5. Suppose its yield to maturity goes up one percentage point (e.g., from 5% to 6%). Which of the following is the most likely consequence for the bond's price?
Decrease by approximately 13.8% | ||
Decrease by approximately $2.5 | ||
Decrease by approximately $13.8 | ||
Increase by approximately 13.8% | ||
Increase by approximately $2.5 |
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