Construct a bond portfolio using PRTU or select a bond portfolio you have already constructed.

a. On your MARS screen, create a fixed-payer position on a generic swap. Add your swap to a portfolio you have created. From the red "Add Positions" tab, click "Add to Portfolio" and then select the portfolio. Analyze the interest rate exposure of the portfolio with and without the swap using the MARS screen. On the MARS "Scenario Chart" tab, set scenario periods, interest rate shifts (e.g., -50 basis points to 50 basis points) and \(y\)-axis market value. Comment on the relation between the market value and interest rate relation.

b. On your MARS screen, create a floating-payer position on a generic swap. Add your swap to a portfolio you have created. From the red "Add Positions" tab, click "Add to Portfolio" and then select the portfolio. Analyze the interest rate exposure of the portfolio with and without the swap using the MARS screen. On the MARS "Scenario Chart" tab, set scenario periods, interest rate shifts (e.g., -50 basis points to 50 basis points) and \(y\)-axis market value. Analyze your portfolio with and without the swap. Comment on the relation between the market value and interest rate relation.

c. On your MARS screen, create a payer swaption. Add your swaption to a portfolio you have created. From the red "Add Positions" tab, click "Add to Portfolio" and then select the portfolio. Analyze the interest rate exposure of the portfolio with and without the swaption using the MARS screen. On the MARS "Scenario Chart" tab, set scenario periods, interest rate shifts (e.g., -50 basis points to 50 basis points), and \(y\)-axis market value. Analyze your portfolio with and without the swap. Comment on the relation between the market value and interest rate relation.

d. On your MARS screen, create a receiver swaption. Add your swaption to a portfolio you have created. From the red "Add Positions" tab, click "Add to Portfolio" and then select the portfolio. Analyze the interest rate exposure of the portfolio with and without the swaption using the MARS screen. On the MARS "Scenario Chart" tab, set scenario periods, interest rate shifts (e.g., -50 basis points to 50 basis points), and \(y\)-axis market value. Analyze your portfolio with and without the swap. Comment on the relation between the market value and interest rate relation.