QUESTION 63

1. Which of the following is correct?

   		a. YTM and convexity are directly related, as one goes up, the other goes up.
   		b. Investors prefer a more convex bond over a less convex bond.
   		c. Modified duration should be used for bonds with embedded options.
   		d. Convexity attempts to estimate the price change in a bond without the need for duration.

QUESTION 64

1. Which of the following is correct?

   		a. Passive fixed income strategies often involve indexing.
   		b. Active fixed income portfolio management may involve anticipating shifts in the yield curve.
   		c. Both a and b.
   		d. Neither a or b.