So they talk about the leverage-adjusted duration gap for banks, which is Duration of assets minus (duration of liabilities)(liabilities/assets) And they also talk about the duration of a leveraged bond portfolio, which is (dollar duration of portfolio minus dollar duration of borrowing)/equity Thing is, these two equations render different answers for the same asset/liability mix, and I can’t see how they’re any different. Anyone help?

take this: the leverage-adjusted duration gap for banks, which is Duration of assets minus (duration of liabilities)(liabilities/assets), multiply by assets value, you get dollar duration of the gap, then devide by equity and you get the duration of a leveraged bond portfolio, which is (dollar duration of portfolio (Aseets) minus dollar duration of borrowing (Liabilities))/equity

Whoa, enlightenment! That was like a Jedi Mind Trick. Thanks for the help.