An investment manager is considering decreasing portfolio duration versus a benchmark index given her expectations of an
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An investment manager is considering decreasing portfolio duration versus a benchmark index given her expectations of an upward parallel shift in the yield curve. If she has a choice between a callable, putable, or option-free bond with otherwise comparable characteristics, the most profitable position would be to:
A. Own the callable bond.
B. Own the putable bond.
C. Own the option-free bond.
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B Own the putable bond In the scenario where an investment manager expects an upward parallel shift ...View the full answer
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