The Practical Application of Bond Portfolio Immunisation to Investors Is

question 5

Multiple Choice

The practical application of bond portfolio immunisation to investors is that immunisation

• A) eliminates the possibility of losing money due to a company defaulting on its bond payments.
• B) allows aggressive traders to eliminate the price effects caused by interest rate changes.
• C) allows investors to derive a specified rate of return from bond investments for a given investment horizon.
• D) allows investors to passively manage their bond portfolio once it is initially immunised.

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