Ladder vs Bond Fund: Price Sensitivity with Duration
This lesson is part of the course
In this lesson
You estimate how a bond fund and a ladder react to rate changes with duration, add the convexity correction for the fund and find the rate rise that costs the fund one year of income.
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Lessons in this course
- Designing a Ladder: Rungs, Equal Amounts & Maturity Years Locked
- Annual Coupon Income & the Maturity Schedule Locked
- Weighted Average Maturity & Yield of the Ladder Locked
- Rolling the Ladder: Reinvestment at New Rates (Chart) Locked
- Cash-Flow Matching: Buying Bonds to Fund Planned Expenses Locked
- Barbell vs Ladder vs Bullet: Income and Duration Locked
- Inflation & Real Income: Nominal Ladder vs Inflation-Linked Bonds Locked
- Ladder vs Bond Fund: Price Sensitivity with Duration Locked