Keep 5% to 10% of your assets in cash. Reinvestment Rate Risk The part of interest rate risk resulting from uncertainty about the rate at which future interest coupons/payments can be reinvested. True or false? 53. The three components of a bond's total return are Interest-on Interest, coupon payments and Principal. True or False? 54. Bond holders usually have capital gains when interest rates are rising. True or False? When a bond's rating improves from A to AA the coupon rate will stay the same, but the price will rise. True or False? 56. #14 Stocks are earnings growth sensitive. > When interest rates change, the prices of short term bonds will change more than those of long-term bonds. True or False? 57. If you want to reduce the price volatility of your bond portfolio, you should shorten the time-to-maturity of your portfolio. True or False? 58. Diversification and knowledge is your best protection against risk. True or False? 59. The interest payment on a 6% coupon, semi-annual bond is $30 every 6 months. True or False? 60. 15 Bonds are interest rate sensitive. P/E - Price-to-Earnings Ratio. True or False? 61. Around lot is considered to be 10 shares. True or False. 62. > Interest rates have the greatest effect on bond prices? True or False 63. January Effect - The observed tendency for small-cap stocks to be higher in January than in other months. True or False? 64