We have been convinced through our research that the purpose of risk management is to use all tools available in the markets to create more robust portfolios that can survive major shocks. In a recent ...

Duration is the primary measure of interest rate sensitivity — it is the percentage change in price for a 1% change in interest rates. However, practitioners also look at convexity, which is the ...

Bonds are popular fixed income investment instruments and are often regarded as bearing relatively low-risk burdens. While bonds are less volatile than other investments, they are not risk-free, ...

Learn how convexity adjustments in bonds affect interest rates and prices using key formulas. Understand their importance in accurately predicting bond price changes.

James Chen, CMT is an expert trader, investment adviser, and global market strategist. Cierra Murry is an expert in banking, credit cards, investing, loans, mortgages, and real estate. She is a ...

In a few recent columns, we’ve talked about duration and convexity in the context of changing market prices. They are some of the most misunderstood and misused terms in finance, and clarifying them ...

Bond convexity measures price sensitivity to interest rate changes in the secondary market. Positive convexity increases bond value as interest rates fall; negative does the opposite. Understanding ...

In the first two months of this year there has been a dramatic reconfiguration of market variables in the US, including interest rates, credit spreads and the yield curve. Both a result of and ...

NEW YORK (Reuters) -The recent drop in U.S. yields has raised speculation that a wave of buying of Treasury securities and derivative products called interest rate swaps by mortgage portfolio managers ...

As bond yields rise and fall past certain levels, there are episodes of highly technical yet increasingly familiar flows that can accelerate moves in either direction. Analysts and traders use terms ...

Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter. Every so often Chris Cole, of Artemis Capital, perhaps one of the deepest and most provocative thinkers in the ...