When market interest rates increase why do bond prices change by less than when market interest rates are low?
Positive convexity
Just to add to that: Positive convexity implies price increases will be greater than price increases, given the same change in interest rates.
bpdulog price increases will be greater than price increases???
Price increase will be greater than price decrease.
got it. Thanks guys.
Yea, that’s what I meant. Thanks for the correction.