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Selling a single bond with a face value of $ 1 , 0 0 0 , a YTM of 8 % , and a duration

Selling a single bond with a face value of $

1, 000,

a YTM of

8 %,

and a duration equal

to that of the portfolio investment, creates a dollar

-

for

-

dollar hedge of the company

investment in A and B

.

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