Questions from General Investment

Q: What does the term duration mean to bond investors and how does

What does the term duration mean to bond investors and how does the duration of a bond differ from its maturity? What is modified duration, and how is it used? What is effective duration, and how does...

Q: Why do call and put options have expiration dates? Is there

Why do call and put options have expiration dates? Is there a market for options that have passed their expiration dates?

Q: Describe the process of bond portfolio immunization, and explain why an

Describe the process of bond portfolio immunization, and explain why an investor would want to immunize a portfolio. Would you consider portfolio immunization a passive investment strategy comparable...

Q: Briefly describe a bond ladder and note how and why an investor

Briefly describe a bond ladder and note how and why an investor would use this investment strategy. What is a tax swap and why would it be used?

Q: What strategy would you expect an aggressive bond investor (someone who’s

What strategy would you expect an aggressive bond investor (someone who’s looking for capital gains) to employ?

Q: Why is interest sensitivity important to bond speculators? Does the need

Why is interest sensitivity important to bond speculators? Does the need for interest sensitivity explain why active bond traders tend to use high-grade issues? Explain.

Q: Explain why interest rates are important to both conservative and aggressive bond

Explain why interest rates are important to both conservative and aggressive bond investors. What causes interest rates to move, and how can you monitor such movements?

Q: What is the term structure of interest rates and how is it

What is the term structure of interest rates and how is it related to the yield curve? What information is required to plot a yield curve? Describe an upward-sloping yield curve and explain what it ha...

Q: How might you, as a bond investor, use information about

How might you, as a bond investor, use information about the term structure of interest rates and yield curves when making investment decisions?

Q: Brett Daly is an active stock trader and an avid market technician

Brett Daly is an active stock trader and an avid market technician. He got into technical analysis about 10 years ago, and although he now uses the Internet for much of his analytical work, he still e...