Sign up  |  Log in

Fixed income- Duration matching

Please correct me if I’m wrong in my understanding of duration matching 

is when you buy  Zero coupon bond but maturity dates are different from your liability’s maturity therefore you match the investment horizon of the bond with the liability’s maturity. 

You’ve made it this far, and you know what it takes to pass. Don’t be fooled by false promises and unrealistic claims. Schweser’s study packages give you the proven study tools and expert instruction you need to finish the job.

That’s correct.

And you’ll have price risk (if the bond’s maturity is longer than the liability’s maturity) or reinvestment risk (if the bond’s maturity is shorter than the liability’s maturity).

Simplify the complicated side; don't complify the simplicated side.

Financial Exam Help 123: The place to get help for the CFA® exams
http://financialexamhelp123.com/