Is it that the duration of 4.00 shall be the “leveraged” duration ? Since among the 140M bond portfolio, 100M is borrowed the bond portfolio. That is to say, the bond portfolio shall be a “leveraged” portfolio. On the other hand, D(equity) of 11.50 shall be “unleveraged” duration, right ? Anyone can advise ?
==Correction to my previous message== Is it that the duration of 4.00 shall be the “leveraged” duration ? Since among the 140M bond portfolio, 100M is borrowed. That is to say, the bond portfolio shall be a “leveraged” portfolio. On the other hand, D(equity) of 11.50 shall be “unleveraged” duration, right ? Anyone can advise ?