easy · Certified Financial Planner General Principles
The Yuen family is looking for a bond to perfectly immunize a future liability that will come due in exactly 12 years.
Which instrument is the best fit for this objective?
- A zero-coupon bond with a 12-year maturity
- A 12-year Treasury bond with a 5% coupon
- A portfolio of short-term T-bills
- A 15-year corporate bond with high convexity
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