Inside the Yield Book

The Classic That Created the Science of Bond Analysis

by: Martin L. Leibowitz|Sidney Homer|Stanley Kogelman

in: Investing

Summary:

The book provides a comprehensive analysis of the fixed-income market, introducing readers to the principles and applications of bond analytics. It covers topics such as yield measures, the behavior of bond prices, and the structure of interest rates, offering insights into the science behind bond investment strategies and portfolio management.

Key points:

1. Duration and Convexity: These tools measure bond price sensitivity to interest rate changes. Duration is the average time to receive a bond's cash flows, indicating interest rate risk. Convexity improves this measure by considering bond price and yield changes' non-linear relationship.

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