The problem of the selection of the time horizon in gap analysis can be solved to some extent by using:
A) maturity balancing
B) maturity matching
C) maturity buckets
D) maturity differences

Question

Quizplus · Accepted Answer

Maturity buckets are used in gap analysis to categorize assets and liabilities into different time frames or "buckets" based on their maturity dates. This helps in managing and analyzing the interest rate risk over different time horizons, thus addressing the problem of selecting a specific time horizon in gap analysis.

The Problem of the Selection of the Time Horizon in Gap