An FI with a neutral repricing gap in its three to six month bucket is hedged against any interest rate changes at all points in time.

Question

Quizplus · Accepted Answer

A neutral repricing gap in the three to six month bucket means that the FI's assets and liabilities that mature or reprice in that time frame are equal. This does not mean that the FI is hedged against any interest rate changes at all points in time, as there may be repricing mismatches in other time buckets or the FI may be exposed to other forms of interest rate risk.

An FI with a Neutral Repricing Gap in Its Three