Sentences with phrase «bond interest rate sensitivity»

Not exact matches

Government bonds could help reduce default risk, but because of the length of maturity required to earn any meaningful yield, they do little to reduce duration risk - i.e. the overall sensitivity of a portfolio to interest rate rises.

This year's budget provides a sensitivity analysis for yields on 10 - year bonds; should interest rates fall in line with the BMO projections, the Ontario government will see estimated gains of $ 400 million next year alone.

Unlike traditional bond funds, a DMF's price sensitivity to changes in interest rates declines gradually over time, approaching zero near the fund's target end - date.

Take an intermediate bond fund with a duration — interest rate sensitivity — of six years.

Instead, I believe it's prudent to extend allocations in other bond sectors and exposures that offer similar interest - rate sensitivity to Treasuries, but with more compelling investment cases.

Similarly, when it comes to your bond investments, consider varying maturities, credit qualities, and durations, which measure sensitivity to interest - rate changes.

As these bonds move toward maturity, the fund's overall interest rate sensitivity gradually declines since bonds with shorter maturities tend to be less sensitive to interest rate changes.

Unlike traditional bond funds, a DMF's price sensitivity to changes in interest rates declines gradually over time, approaching zero near its target end date.

The Interest Rate Sensitivity Illustrator for Bond Funds demonstrates how a 1 % move in interest rates could impact a fund's net asseInterest Rate Sensitivity Illustrator for Bond Funds demonstrates how a 1 % move in interest rates could impact a fund's net asseinterest rates could impact a fund's net asset value.

Since changes in interest rates impact bond funds differently than bonds and CDs, estimates of price sensitivity may be less accurate the larger the shift in interest rates.

Funds can also have different levels of interest rate sensitivity depending on whether they focus their investments on short, intermediate, or long - term bonds.

Duration is a measurement of a bond's — or a portfolio's — sensitivity to interest - rate movements.

Duration is a measure of a bond portfolio's sensitivity to changing interest rates.

Duration, expressed as a number of years, measures a bond's interest rate sensitivity: The higher the duration, the higher the interest rate risk.

Remember, duration is a measure of a bond's sensitivity to interest rate changes.

Think of it as a measure of a bond's sensitivity to interest rates.

For individual investors, duration is primarily used as a measure of a bond fund's sensitivity to prevailing interest rates.

2 Duration measures a bond's price sensitivity to interest rate changes.

Most bond mutual funds seek to maintain a relatively constant interest rate sensitivity for their investors.

This is designed to offer investors the best of both worlds: The diversification benefit of a traditional bond mutual fund and the declining interest rate risk sensitivity of an individual bond.

Even without any selling, the value of the fund's share price would fall (roughly as a function of the fund's average «duration», a measure of interest rate sensitivity that is a related to a bond's maturity).

As a bond moves towards its maturity over time, its interest rate sensitivity gradually declines, eventually to zero at maturity.

Consequently, unlike traditional bond funds, a DMF's price sensitivity to changes in interest rates declines gradually over time, approaching zero near its target end date.

As the bonds in the mutual fund's portfolio move towards maturity, the fund's interest rate sensitivity would decline.

What we have seen actually is a significant lengthening of duration, which is the interest rate sensitivity of bond markets over the last 10 years or so.

Interest rate sensitivity, also known as duration, is based on the Barclays U.S. Credit Bond Index (all maturities), and short - term bonds represented by the subset of bonds within the index with maturities of 1 - 5 years (Barclays 1 - 5 Year U.S. Credit Bond Index).

The Xtrackers Investment Grade Bond - Interest Rate Hedged ETF seeks to invest in investment - grade corporate bonds, denominated in USD, while mitigating interest - rate sensInterest Rate Hedged ETF seeks to invest in investment - grade corporate bonds, denominated in USD, while mitigating interest - rate sensitivRate Hedged ETF seeks to invest in investment - grade corporate bonds, denominated in USD, while mitigating interest - rate sensinterest - rate sensitivrate sensitivity.

They also have sensitivity to interest rates, so as interest rates rise, the value of a high yield bond can decline, and vice versa.

Although yields are ultralow — the 10 - year U.S. Treasury yield is currently around 1.60 % — the duration, or interest rate sensitivity, of bond investments has steadily risen (source: Bloomberg).

Not all dividend stocks are the same; some are slow - growth dinosaurs that are little better than bonds with respect to their sensitivity to rising interest rates.

One option for investors seeking to reduce their interest rate risk and increase yield, while still maintaining the overall risk profile similar to a traditional Canadian bond portfolio is the iShares Short Term Strategic Fixed Income ETF (XSI), which seeks to deliver a higher yield with reduced interest rate sensitivity.

Duration, or interest rate sensitivity, of bond investments has steadily risen recently as investors have piled money into fixed income.

A national portfolio of short - term municipal bonds seeking tax - free income with lower interest - rate sensitivity

They also have sensitivity to interest rates, so as interest rates rise, the value of a high yield bond can decline, and vice versa.

In layman's terms, duration is a measure of the sensitivity of a bond's price to changes in interest rates.

While it is understandable that market participants are concerned about interest rate risk in a rising rate environment, it is interesting to note that the high yield bond sector stands out within the fixed income market with less rate sensitivity.

Match the interest rate sensitivity of the index, and the credit quality, but choose bonds that had more potential than the bonds in the index.

In one sense, it freed bond management, because rather than hard constraints, they matched credit and interest rate sensitivities of the index.

A bond's sensitivity to interest rates is measured by what's called «duration.»

As mentioned earlier, bonds with varying levels of interest - rate sensitivity and credit risk have historically performed differently as rates rise.

High yield bonds have more interest rate sensitivity with duration of just less than 5 years and an average maturity of 6.8 years.

But their interest - rate sensitivity can be lower because they typically offer higher yields than many other types of bonds.

This measure of price sensitivity towards interest rates is called a bond's duration.

To do that, you need to look at corporate bond funds with a similar duration, which is a measure of sensitivity to interest rate risk.

Duration is a quantifiable measurement of bond sensitivity to changes in interest rates: if they change by 1 %, how much will the price of the underlying bond, or portfolio of bonds, likely change.

You can check a bond fund's sensitivity to interest rates by looking up its effective duration, which can be used to estimate how much the fund would gain (or fall) should interest rates decline (or rise) by 1 percentage point.

Instead, I believe it's prudent to extend allocations in other bond sectors and exposures that offer similar interest - rate sensitivity to Treasuries, but with more compelling investment cases.

For example, in the bond portion of a portfolio with a large fixed income allocation, it's possible to pursue better income opportunities while also managing the portfolio's sensitivity to interest - rate movements or other bond risks using an actively managed, unconstrained bond fund.

How much they fall depends on a bond's duration, which measures sensitivity to interest rate changes.

Take an intermediate bond fund with a duration — interest rate sensitivity — of six years.