Why is Duration Better than Term
{"Image DocumentName": "Why is Duration Better than Term?", "Image ImageDescription": "Earlier, it was noted that duration is a better measure than term to maturity. To see why, look at the following example: Suppose that you are comparing two five-year bonds (annual payments), and are expecting a drop in yields of 1% almost immediately. Bond 1 has a 6% coupon and bond 2 has a 14% coupon. Which would provide you with the highest potential gain if your outlook for rates actually occurs? Assume that both bonds are currently yielding 8%.", "Image XResolution": "37", "Image YResolution": "37", "Image ResolutionUnit": "Pixels/Centimeter", "Image Software": "SlidePlayer", "Image YCbCrPositioning": "Centered"}