Shield off interest rate risk of bond or bond portfolio

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Reference no: EM132029477

Immunization is a strategy of shielding off interest rate risk of a bond or a bond portfolio using the concept of duration.

Required:

1. A Critically discuss how this strategy would work if you were the investment manager of a pension fund.

2. Discuss the pros and cons of using immunization to shield off the interest rate risk of a bond or a bond portfolio.

Reference no: EM132029477

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