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Why Is It Considered That Implied Volatility of Interest Rate

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Why is it considered that implied volatility of interest rate options has a "hump" shape?


Definitions:

Histrionic Personality Disorder

A mental disorder characterized by a pattern of excessive attention-seeking behaviors, emotional overreaction, and suggestibility.

Histrionic Personality Disorder

A mental health condition characterized by a pattern of excessive attention-seeking behaviors, emotionality, and a desire for approval.

Histrionic

Relating to a personality disorder characterized by a pattern of excessive emotionality and attention-seeking behaviors.

Borderline

Often used in the context of Borderline Personality Disorder, it describes a mental health condition characterized by unstable moods, behavior, and relationships.

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