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Bond Portfolio Immunization
A strategy to minimize the impact of interest rate fluctuations on the market value of a bond portfolio by matching the portfolio's duration with the investor’s investment horizon.
Price Risk
The risk that the price of a financial asset will fluctuate, affecting the profit or loss of an investment.
Reinvestment Risk
The risk that future proceeds will have to be reinvested at a lower potential interest rate.
Interest Rate Risk
The risk that an investment's value will change due to a change in the absolute level of interest rates, in the spread between two rates, or in any other interest rate measure.
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