CFA Practice Question

There are 266 practice questions for this study session.

CFA Practice Question

Which duration measure indicates the investment horizon in which coupon reinvestment risk and market risk offset each other?

A. Macaulay duration
B. Modified duration
C. Effective duration
Correct Answer: A

For a particular assumption about yield volatility, the Macaulay duration indicates the investment horizon in which coupon reinvestment risk and market price risk offset each other.

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