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You are long in bonds for developing countries and short in bonds for developed countries. You finance your investment by borrowing and using underlying bonds
You are long in bonds for developing countries and short in bonds for developed countries. You finance your investment by borrowing and using underlying bonds as collateral All of a sudden, Country X, a developing country, defaults on its debt obligations. Investors fear that all developing countries will default. a. The bond prices of developing countries will because b. The bond prices of developed countries will because c. Furthermore, collateral requirements will because d. The value of your bond portfolio will and you will receive a You are long in bonds for developing countries and short in bonds for developed countries. You finance your investment by borrowing and using underlying bonds as collateral All of a sudden, Country X, a developing country, defaults on its debt obligations. Investors fear that all developing countries will default. a. The bond prices of developing countries will because b. The bond prices of developed countries will because c. Furthermore, collateral requirements will because d. The value of your bond portfolio will and you will receive a
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