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Question 7 2 pts A client has a 10.7-year investment horizon. Construct a portfolio with the following two bonds for this investor to help protect
Question 7 2 pts A client has a 10.7-year investment horizon. Construct a portfolio with the following two bonds for this investor to help protect against interest rate risk. What is the weight to put on bond B in this portfolio? Macaulay duration 5.7 Bond A Bond B 12.1 Round your answer to 4 decimal places. For example if your answer is 3.205%, then please write down 0.0321. Question 8 2 pts An investor with a 5-year investment horizon put together a bond portfolio with a duration of 6 in years. Is this investor at risk of higher interest rate, lower interest rate, or perfectly hedged against interest rate risk? At risk of higher interest rate. At risk of lower interest rate Perfectly hedged
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