The Statement That a Portfolio Is Immunised Using Duration Matching

question 31

Multiple Choice

The statement that a portfolio is immunised using duration matching:

• A)means that the FI is entirely hedged against interest rate risks
• B)is misleading as duration matching is a dynamic process and only hedges the FI against instantaneous interest rate changes
• C)is misleading as duration matching is a dynamic process and only hedges the FI against interest rate changes that occur within a month
• D)None of the listed options are correct.

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Definitions:

Structural Gene

A gene that codes for any RNA or protein product other than a regulatory factor.

Transcription Factors

Proteins that bind to specific DNA sequences, thereby controlling the transfer (transcription) of genetic information from DNA to messenger RNA.

Leucine Zipper Proteins

A type of protein that contains a specific motif which allows it to dimerize and bind DNA, playing key roles in regulating gene expression.

Homodimers

Molecular complexes formed from two identical protein molecules that bind together, often to become functionally active.