The current price of a BLX Inc. bond is $103.00. If the yield increased by 50 basis points (bp), the price would decline to $100.25 while if the yield decreased by 50 bp, the price would increase to $104.50. What is the effective convexity of the bond?

Answer rating: 100% (QA)

To calculate the effective convexity of a bond we need to use the formula Effect... View the full answer