In a bullet immunization application, the manager seeks to get ___________ to cancel out.
A) interest rate risk and reinvestment rate risk
B) interest rate risk and default risk
C) convenience risk and price risk
D) reinvestment rate risk and default risk

Question

Quizplus · Accepted Answer

In a bullet immunization strategy, the manager aims to offset interest rate risk and reinvestment rate risk to ensure that the portfolio's value at a specific future date is not affected by changes in interest rates.

In a Bullet Immunization Application, the Manager Seeks to Get