Advantages of Cash Flow Matching and Dedicated Strategies Include

question 44

Multiple Choice

Advantages of cash flow matching and dedicated strategies include:
I. Once the cash flows are matched, there is no need for rebalancing.
II. Cash flow matching typically earns a higher rate of return than active bond portfolio management.
III. Financial institutions' liabilities often exceed the maturity of available bonds, making cash matching even more desirable.

• A) I only
• B) II only
• C) I and III only
• D) I, II, and III

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Definitions:

Flowering

The process by which plants produce flowers, which are the reproductive structures that facilitate sexual reproduction involving pollination and seed production.

Dormancy

In plants, a cessation of growth under conditions that seem appropriate for growth.

Plant Embryo

The early developmental stage of a plant within a seed, resulting from the fertilization of an egg cell.

Radicle

The first part of a seedling to emerge from the seed during the process of germination, which develops into the primary root.