Which of the following statements is the LEAST accurate with respect to the portfolio duration measure?

A. Portfolio duration changes all the time, even without changes in yields.
B. Portfolio duration is only a valid measure for portfolio interest rate risk for parallel changes in the yield curve.
C. Portfolio duration will increase as more bonds are included in the portfolio.

Correct Answer: C

Portfolio duration will NOT necessarily increase as more bonds are included in the portfolio. If the bonds being added to the portfolio had low durations, then the portfolio duration, which is just the weighted average of the individual durations, would decrease.