easy · CFA Level I fixed-income
For an option-free bond issued by Redhook Ports, the price-yield curve is 'convex'. This property implies that for a given absolute change in yield:
- The price change is always linear and proportional to the yield change.
- The price increase for a yield decrease is greater than the price decrease for a yield increase.
- The price decrease for a yield increase is greater than the price increase for a yield decrease.
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