Yield Volatility Question

The most important consideration in determining the number of observations to use to estimate the yield volatility is? A) The shape of the yield curve. B) The risk aversion to AFJunkie. C) The appropriate time horizon. D) The liquidity of the underlying instrument.

A. Seems to be the only choice that makes sense and relevent in the calculations. Delta y/y.


It’s C. The more your time increases the more observations you can put in your model.

Bet on C