medium · Certified Financial Planner Estate Planning

Mr. Yamamoto is looking for an investment to precisely match a future liability in exactly 10 years.

Which instrument is most appropriate for this immunization strategy?

  1. A 10-year Treasury bond with a 5% coupon.
  2. A zero-coupon bond with a 10-year maturity.
  3. A laddered portfolio of corporate bonds with an average maturity of 10 years.
  4. A high-yield bond fund with a duration of 8 years.

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