#bonds #finance
The
sensitivity of a bond's market price to interest rate (i.e. yield) movements is measured by its
duration, and, additionally, by its
convexity.
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Bond valuation - Wikipedia, the free encyclopedia> current yield > coupon yield.When a bond sells at a premium, coupon yield > current yield > YTM.When a bond sells at par, YTM = current yield = coupon yield
Price sensitivity[edit]
Main articles: Bond duration and Bond convexity
<span>The sensitivity of a bond's market price to interest rate (i.e. yield) movements is measured by its duration, and, additionally, by its convexity.
Duration is a linear measure of how the price of a bond changes in response to interest rate changes. It is approximately equal to the percentage change in price for a given change in yi Summary
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