Examlex
These statements are about eating and nutrition.Which is incorrect?
Interest Rate Risk
The potential for investment values to change due to variations in interest rates, affecting especially bonds and other fixed income investments.
Bond Prices
The amount of money required to purchase a bond, which can fluctuate based on interest rates, credit quality, and other factors.
Duration
A financial metric that calculates the weighted average time until a bond or a portfolio of bonds pays out its cash flows, used to assess interest rate risk.
Effective Maturity
The average time until a bond is repaid, considering possible calls or prepayments, which might alter the time frame for return on investment.
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