“I can immunize a portfolio simply by investingin zero-coupon Treasury bonds.” Comment on this statement.
Answer to relevant QuestionsWhy is there greater risk in a multi-periodimmunization strategy than a cash flow matching strategy? What are the risks associated with fundinggap risk? In December 2003, a European insurance company, Swiss Re, issued a 3-year floating-rate bond maturing on January 1, 2007, with a par value of US$400 million. The interest-rate payments were quarterly with a coupon reset ...Suppose that the active return for a portfolio over the past year was 130 basis points after management fees. What questions would you have to before concluding that the manager’s performance was exceptional? If the average quarterly return for a portfolio is 1.78%, what is the annualized return?
Post your question