Banking · Treasury & Risk Management
In treasury risk management, duration analysis is important because it helps assess how sensitive a debt instrument is to interest rate changes. A higher duration generally implies:
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1zero volatility in coupon-bearing securities
- 2complete immunity from reinvestment risk
- 3greater price sensitivity to changes in interest rates✓
- 4lower price sensitivity to yield movements
Correct answer
greater price sensitivity to changes in interest rates
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