Question 15 You are a bond fund manager benchmarked to an index with 3 bonds in it: 1) a 5-year bond; 2) a 10-year bond; and 3) a 15-year bond. Each has a weight of 33.3%. You have $100mm invested in this index. You decide to invest all your proceeds ($100mm) in the 5-year bonds. What are your risks? When do you do well? When do you lose? What if you invested the $100mm in the 15-year bonds instead? What are your risks? When do you do well? When do you lose? This is a qualitative question. No spreadsheet needed. Question 15 You are a bond fund manager benchmarked to an index with 3 bonds in it: 1) a 5-year bond; 2) a 10-year bond; and 3) a 15-year bond. Each has a weight of 33.3%. You have $100mm invested in this index. You decide to invest all your proceeds ($100mm) in the 5-year bonds. What are your risks? When do you do well? When do you lose? What if you invested the $100mm in the 15-year bonds instead? What are your risks? When do you do well? When do you lose? This is a qualitative question. No spreadsheet needed