2011 CFAI Mock Question 32

Why is the portfolio rebalanced to match the dollar duration from one year ago and not to 4.4 x 150m x 0.01 which would immunize the liablity? Thanks for clarifying.

immunization has nothing to do with the question.

How do you know that you have to rebalance it to match the dollar duration from a year ago? I’m still not getting that part.

woolv Wrote: ------------------------------------------------------- > How do you know that you have to rebalance it to > match the dollar duration from a year ago? I’m > still not getting that part. text says “reestablish the original dollar duration”