What Does Rho Measure

question 18

Multiple Choice

What does rho measure?

• A) The rate of change of delta with the asset price
• B) The rate of change of the portfolio value with the passage of time
• C) The sensitivity of a portfolio value to interest rate changes
• D) None of the above

---

Definitions:

Enforceable

A term describing a contract or legal obligation that is legally binding and can be upheld in court.

Junk Bonds

High-risk, high-yield bonds issued by companies considered to be at greater risk of default.

Government Bonds

Debt securities issued by a government to finance its borrowing requirements, offering a fixed or variable interest rate payable to holders.

Dividends

Payments made by a corporation to its shareholder members from its profits or reserves.