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One way to protect your bond investments from price risk is to change the proportion that is invested in long-term bonds and in short-term bonds.

One way to protect your bond investments from price risk is to change the proportion that is invested in long-term bonds and in short-term bonds.

If you expect interest rates to rise what can you do to minimize the price risk effect on your bond investments?

a. Sell your long-term bonds and use the proceeds to buy more short-term bonds
b. Sell your short-term bonds and use the proceeds to buy more long-term bonds

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